As one of the Magnificent Seven stocks, Tesla (Nasdaq: TSLA) has never looked better. With a market cap of $536.7 billion, Tesla is more than just an EV maker. The company is in the driver’s seat of cutting-edge technologies that are transforming society, not least artificial intelligence (AI), all through the lens of its product of focus, EVs. With Elon Musk at the helm for the past 16 years, Tesla has stayed true to its early mission to “accelerate the advent of sustainable transport” by bringing EVs to the masses, offering investors continuity. But Tesla’s road map has also evolved.

Right now, Tesla stock is trading off its highest-ever level of nearly $410 reached back in 2021. While there have been near-term headwinds owing to softer demand for EVs, TSLA bulls believe it’s important to take a long-term view of this pioneering company to recognize its true value. Any way you slice it, Tesla is one of the more exciting stocks in the Magnificent Seven. Here are five reasons why it’s also the stock to buy right now.

1.) Elon Musk

The one thing that Tesla has that no other Magnificent Seven stock does is Elon Musk. As a 13% owner of the company, Musk holds roughly 411 million shares of TSLA common stock. He once owned more but sold part of his stake in 2022 to finance his acquisition of social-media platform Twitter. Musk’s wealth has been rising alongside Tesla’s stock, increasing by a massive $10 billion to $188 billion on the heels of Tesla’s Q1 earnings results.

Now Musk is looking for more control of the company and seeks to nearly double his equity stake to 25%. Chief among the reasons is because he is concerned about the potential of technology like AI falling into the wrong hands. He wrote in a post on X: “I am uncomfortable growing Tesla to be a leader in AI & robotics without having ~25% voting control. Enough to be influential, but not so much that I can’t be overturned.”

2.) Self-Driving

Tesla has already begun implementing its supervised Full-Self-Driving (FSD) software v12.3.6 to vehicle owners in North America. Tesla owners are waiting anxiously for their turn to receive the update. While FSD is available in the U.S. market, it has yet to arrive in China. But Musk is trying to change that after making a surprise trip to Beijing to discuss the technology with Chinese officials. The country is reportedly open to allowing foreign carmakers into the self-driving mix, and Tesla is seemingly first in line.

By the year 2035, self-driving vehicles have the potential to generate between $300 billion-$400 billion in sales, per McKinsey & Co. Considering the massive amount of data Tesla’s able to collect on drivers, the company is likely to claim a significant amount of market share, which will drive more revenue. Tesla’s FSD fee model comprises a $12,000 upfront fee for the software as well as a subscription fee of close to $200 per month.

3.) AI Influence

Tesla has been harnessing AI technology for its products and features since day one. On the company’s Q1 earnings call, Musk expressed his desire for Tesla to be treated as an AI or robotics company instead of an automaker. Tesla has earmarked $10 billion to direct toward AI this year alone, with much of it going toward what Musk describes as solving autonomy. In addition to autonomous EVs, Tesla is exploring robotaxis, and the licensing of its AI algos to rival automakers, a strategy that’s working for Netflix (Nasdaq: NFLX) on the content-streaming side.

ARK Invest’s Cathie Wood believes AI is a winner takes all market, and Tesla is strategically positioned to do just that. She predicts the AI market will product between $8 trillion and $10 trillion by 2030 and that Tesla will capture 50% of those sales. Wood says Tesla is the world’s biggest AI project, one that’s on the brink of delivering “autonomous taxi networks.”

4.)  Wall Street Bulls

Tesla’s stock has lost nearly one-third of its value year-to-date as investors have worried about weakening demand for EVs. Automakers including Tesla have responded to changing market conditions by implementing price cuts on their vehicles, and this has sent shivers down the spines of Tesla investors. Nevertheless, the International Energy Agency predicts EV sales will rise to 17 million this year vs. 14 million in 2023, 10 million of which are expected to occur in China.

Musk’s warm reception in China bodes well for the company’s role in the future of EVs, FSD and robotaxis. Wedbush analyst Dan Ives, who has a price target of $275 on Tesla stock, called Musk’s China visit a “watershed moment,” one that could potentially pave the way for Tesla’s autonomous driving software in the Chinese market. If he’s right, that could be a game-changer for Tesla as automakers jockey for position in China’s fiercely competitive EV market.

5.) Future Is Bright

Tesla is likely to look like a different company in a decade from now, one that has become synonymous with AI-fueled autonomous driving. Meanwhile, Tesla vehicles are becoming more affordable for the mainstream, rivaling prices for fossil-fuel-powered vehicles, which could help to strengthen demand and sales volume in the near term. While it might not be smooth sailing the entire way, there are several key catalysts in play that can help Tesla achieve the ambitious roadmap that Musk has created. And that’s why this Magnificent Seven stock is a buy right now.

Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.