(News Bulletin 247) – This supercomputer called “Dojo” will allow the group to expand its markets and have a significant competitive advantage, according to the bank’s analysts.
“Dojo”, the name of Tesla’s “supercomputer”, turns out to be telling. In the language of martial arts, a dojo constitutes the training place of the fighter, where he learns the basics of the art and perfects his techniques.
This supercomputer embodies one of Tesla’s weapons to harness the potential of its advances in artificial intelligence, and should ultimately allow it to improve the autonomous driving technologies of its automobiles. This is done by processing a large volume of video data to “train” (like in the dojo) these artificial intelligence technologies.
“Dojo would be able to manage the videos alone, and to carry out its learning in various contexts, more complex and more quickly. Concretely, it will be used to improve (the) advanced Full Self-Driving (FSD) driving assistance system” , explained John Plassard of Mirabaud, in July.
>> Access our exclusive graphic analyses, and gain insight into the Trading Portfolio
A supercomputer already put into orbit
During the conference dedicated to its second quarter results, Tesla also announced the start of production of this supercomputer. The group then indicated that it was aiming for 100 exaflops by October 2024, or 100 billion billion operations per second, according to The world. Management added that it planned to invest more than a billion dollars in this project by the end of 2024.
Remember that, according to Elon-Musk himself, the autonomy of Tesla’s electric vehicles constitutes the key to the stock market valuation of the automobile manufacturer with the highest market capitalization in the world ($789 billion before the opening of this Monday).
This Monday, in a note published on Monday and cited by several American media, Morgan Stanley seems to add grist to the mill of the CEO of Tesla.
The American bank and its analyst, Adam Jonas, raised their price target from $250 to $400. Compared to Friday evening’s close ($248.50), this target gives a potential of 61% to the stock and would add nearly $500 billion in market capitalization.
For now, Tesla shares are up 5.6% this Monday in pre-opening trading on Wall Street, which, assuming that this increase continues, would translate into a gain of forty to fifty billion dollars in capitalization.
A manufacturer AND a technology group
“In its quest for solutions for autonomy, Tesla has developed an advanced supercomputer architecture that (…) can give Tesla an asymmetric advantage in a total market of 10,000 billion dollars,” underlines Morgan Stanley, according to Barron’s.
The American bank mentions in passing the famous debate: is Tesla a car manufacturer or a technology group? Response from the American bank: “both”. It considers that sales of software and associated services will constitute the main driver of value creation.
Thus Dojo should expand Tesla’s addressable market, as AWS (Amazon Web Services) did for Amazon in cloud computing services, considers Adam Jonas, according to Bloomberg. “The more we look at Dojo, the more we realize the potential for the stock’s value to be undervalued,” the analyst writes.
This observation also tends to prove the famous tech “high priestess” on Wall Street, Cathie Wood, right. Little appreciating the remarks on her failure with Nvidia (it had exited the stock at the start of the year shortly before its stock market rally due to the explosion of generative AI), the investor recently assured that Tesla would constitute one of the big winners in AI. Remember that Cathie Wood thinks that the car manufacturer’s stock will be worth $2,000 in 2027. The market capitalization would then theoretically increase to more than $6,000 billion…
I have over 8 years of experience working in the news industry. I have worked as a reporter, editor, and now managing editor at 247 News Agency. I am responsible for the day-to-day operations of the news website and overseeing all of the content that is published. I also write a column for the website, covering mostly market news.