Investors often cannot gain equal exposure to multiple highly profitable sectors with a single stock. According to Morgan Stanley analyst Adam Jonas, however, You’re here (NASDAQ:TSLA) shares offers investors exactly this opportunity.
Jonas views an investment in TSLA shares as a play on both automotive and technology. However, it doesn’t even end there. The analyst also acknowledges the company’s strong ties to the alternative energy sector, especially at a time when green technology is becoming increasingly important.
TSLA seems to have cooled off after last week’s winning streak. Shares fell today after some turbulence, closing down 1.5%. However, the stock still leaves March in a significantly better place than it was at the start of the month. It’s up more than 20% for a month. It is also likely to continue to rise.
TSLA stock: three sectors, one company
Recently, Jonas reiterated his TSLA stock price target of $1,300, maintaining a “buy” rating. As noted, the reason for Jonas’ bullish attitude toward Tesla is that it’s a three-to-one play on profitable sectors. “What we see emerging in this year is Tesla as an onshore renewable energy infrastructure company,” the analyst said in a note yesterday.
Jonas raises a valuable point. While we first think of Tesla as an electric vehicle (EV) producer, the company’s work in other areas of technology has strong applications for the renewable energy field. Additionally, Tesla’s energy storage solutions are likely to play an increasingly important role in the country’s quest for energy independence.
It’s not just the United States that will use the technology, either. For example, an Australian utility recently selected Tesla’s Megapack batteries for a $113 million project to safeguard the nation’s wind and solar power. This could be a preview of what’s to come for other countries.
Most TSLA stock news these days centers around the company’s electric vehicle production and distribution. Even very optimistic analysts like Wedbush’s Dan Ives have focused on vehicle expansion in recent months. Jonas is one of the first voices on Wall Street to draw attention to Tesla’s renewable energy applications — and he’s absolutely right to do so.
Energy security equals national security
There’s another quote from Jonas’ report that investors should consider: “Energy security = national security.” This highlights the importance of energy security as a broader market trend. In fact, it is already shaping public policy. News broke yesterday that President Joe Biden could use the Defense Production Act to boost battery metal mining. For EV producers, this is a significant boon. But the most important message is that the United States is prioritizing energy independence, seeing electric vehicles as key.
Tesla is generally considered the world’s largest producer of electric vehicles. However, as Jonas points out, he also has stakes in renewable energy generation and storage. Going forward, the TSLA stock appears to play an important role in several sectors.
At the date of publication, Samuel O’Brient held (neither directly nor indirectly) any position in the securities mentioned in this article. The opinions expressed in this article are those of the author, subject to InvestorPlace.com Publication guidelines.