Tesla May Be Worth $8 Trillion, Double NVIDIA

By Douglas A. McIntyre Published Sep 7, 12:06PM EDT

Follow 24/7 Wall St. on Google

This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.

Tesla May Be Worth $8 Trillion, Double NVIDIA — © 24/7 Wall St.

Famous tech analyst Gene Munster, did some simple math. If a new compensation package for founder and CEO Elon Musk can hit $1 trillion over the course of 10 years, Tesla (NASDAQ: TSLA | TSLA Price Prediction) will be worth $8.5 trillion in the tenth year. That is more than twice NVIDIA’s (NASDAQ: NVDA) current market value, and eight times what Tesla’s is today.

Among the reasons Munster ran the numbers is that part of Musk’s longer-term comp is tied to market cap. If there is no $8.5 trillion market cap, there is no $1 trillion compensation. Musk’s pay package has other factors, but none tops the market cap yardstick.

Munster is skeptical about whether Musk’s most important projects will be overwhelming successes. One is to transform Tesla into a robotics company. Muck’s name for the robot is Optimus. It will be built as a “robotics humanoid.” It will be able to handle most basic human tasks completely, and could be used by hundreds of millions of people. One hurdle is what people will have to buy. Another is the project’s execution. And, as is true with some other Tesla products, it will have competition.

Another decision could drive up Tesla’s value. This would be a transaction between Tesla and Musk’s xAI business. xIA is a race with OpenAI and the AI efforts by the world’s largest tech companies. And the transaction could be complex. It could be a buyout, a license, or a new company that would own parts of both xAI and Tesla. Shareholders of each might have objections.

Finally, Tesla says it will win the race for a fully self-driving vehicle, which does not require the occupants to operate it at all. These have not been approved for use commercially. There are tests in several cities, and they often compete directly with Google’s Waymo. The hurdles to this plan are that most approvals are at the city level. And, the Tesla product will not be the only one in the field.

Munster thinks the best chance for a sharp rise in market cap is a combination of xAI and Tesla. “Tesla can leverage xAI’s research to help build its physical AI models,” Munster writes. However, he does not handicap this as a likely conclusion.

About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.