Wedbush analyst Daniel Ives reiterated an Outperform rating and $600.00 price target on Tesla (NASDAQ: TSLA)

The analyst commented, "Elon Musk announced that SpaceX and Tesla will build two advanced chip factories in Austin, Texas with the company focused on building a Terafab facility to keep up with necessary demand for chip technology powering TSLA’s AI strategy. One factory will be focused on powering Tesla’s cars and Optimus humanoid robots with the other being designed for AI data centers in space with Musk focused on generating 1 terrawatt of capacity annually (~2x current US production) as current suppliers, including Micron, TSMC, and Samsung, are unable to meet future demand for TSLA’s AI strategy... While the timeline for this project is uncertain, this will accelerate the company’s ambitious AI path which we believe will set the foundation for TSLA to become an AI powerhouse over the coming years with chip and memory supply expected to be the greatest constraint. We also believe this is the first step to ultimately what will be Tesla and SpaceX combining forces in a merger likely in 2027."

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Shares of Tesla closed at $380.85 yesterday.