Why Tesla Bot Is An Absolute 'Head Scratcher' That Will Further Agitate Investors

Tesla, Inc. TSLA made multiple announcements at its AI Day on Thursday.

The Tesla Analyst: Wedbush analyst Daniel Ives maintained an Outperform rating and $1,000 price target on Tesla shares.

The Tesla Thesis: Tesla made a surprise announcement of the Tesla Bot, a humanoid robot designed to perform dangerous and repetitive tasks and armed with the same chips and sensors used in the self-driving features of its cars, analyst Ives said in a note.

As with robotaxis and Elon Musk's other future sci-fi projects, the Tesla Bot is an "absolute head-scratcher" that will agitate investors further the analyst said. Investors are already concerned about rising competition and safety issues with Tesla's cars, he added.

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"While we appreciate Musk's longer term technology vision, a Tesla Bot is not what investors want to see with instead much more focus on chips, FSD, and reaccelerating China EV demand in this key market at a critical juncture," Ives said.

The AI Day event showcased the massive AI technology underway at Tesla, underlining that the company is much more than a traditional auto company, the analyst said. However, investors may want Musk to focus on driving near-term battery technology enhancements, capacity build-outs at GIgafactory Berlin and in Austin, and fending off rising EV competition from all angles globally and not humanoid robots, he added.

Focusing on correcting the current issues, including China demand, safety issues and chip shortages, should be the key task at hand for Musk and the stock, Ives said.

TSLA Price Action: At last check Friday early afternoon, Tesla shares were up 0.35% at $677.46.

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Photo: Courtesy of Tesla