Stock market today: S&P 500 climbs as health care, tech gain; Nvidia earnings loom
Investing.com -- Wedbush analyst Dan Ives said in a note Wednesday that Elon Musk’s recent apology to President Donald Trump could reopen the path for a renewed alliance, which he views as a "smart move with [the] Robotaxi launch on deck."
Musk posted on X, "I regret some of my posts about President Trump last week, They went too far."
The Wedbush analyst believes this marks an "important step" in mending fences between the two. Ives feels the apology is crucial because "Musk needs Trump and Trump needs Musk."
The firm has observed that the "former BFFs turn against each other has been an overhang on shares of Tesla (NASDAQ:TSLA)," as investors feared a "Trump in revenge mode will make it more difficult for an autonomous future with Tesla front and center."
While not expecting a return to their "Mar-a-Lago connected at the hip days," Wedbush anticipates they will "slowly mend the fences" as Trump needs Musk to stay close to the Republican party, and Musk needs Trump for various reasons, including a "green light on a federal framework for autonomous."
The timing of the reconciliation is considered notable as Tesla is set to launch its highly anticipated Robotaxi in Austin on June 22.
Wedbush sees this as a "major endeavor for Musk and Tesla" and believes the "Trump feud is not getting in the way of this."
The core focus for investors, according to Ives, is the "AI Revolution is now coming to Tesla," which will position Tesla as "one of the best pure plays on AI over the next decade" alongside companies like Nvidia (NASDAQ:NVDA) and Microsoft (NASDAQ:MSFT).
Wedbush estimates the "AI and autonomous opportunity is worth at least $1 trillion alone for Tesla" and fully expects that "under a Trump White House, these key initiatives will get fast-tracked."
They believe "Tesla could reach a $2 trillion market cap by the end of 2026 in a bull case scenario," as the "march to a $2 trillion valuation for TSLA has now begun."