Tesla is most underpriced AI play in the market

Tesla (TSLA) posted mixed third quarter results, with adjusted earnings of $0.72 per share surpassing the estimated $0.60, while revenue of $25.18 billion fell short of the $25.43 billion expected. Despite this, the automaker provided an optimistic forecast, projecting 20-30% growth for 2025.

Wedbush Securities Managing Director & Senior Equity Analyst Dan Ives tells Morning Brief that margins were crucial this quarter.

"That's been a huge part of the overhang on this story. They beat by 200 bps (basis points). Price cuts in the rearview mirror. And when you combine that with that growth forecast, I think whisper numbers called ten, eleven percent. They gave twenty and thirty percent. It's an Aaron Judge-like quarter," Ives states.

Ives predicts Tesla will launch an affordable EV priced under $30,000, boosting company revenues — a factor he believes is reflected in the growth forecast. While acknowledging a "painful year" for EV demand, he anticipates a "renaissance of growth" in 2025, driven by advances in AI and autonomous driving technologies.

Regarding the upcoming US election's impact on the EV market, Ives tells Yahoo Finance: "I do believe if Trump gets elected second term, it's bearish for EVs... but I do believe that it's bullish for Tesla."