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Citi analysts told investors in a note on Thursday that Tesla (NASDAQ:TSLA) Chief Executive Elon Musk’s comments in a Q&A session at its Investor Day “bode well” for Nvidia (NASDAQ:NVDA).
The analysts, who have a Buy rating and $245 price target on Nvidia shares, said Musk commented that Tesla has the biggest neural net training system in the world for its fleet and expects to increase the capability “by an order of magnitude” by the end of this year.
In addition, he reportedly stated there will likely be another order of magnitude by the end of next year with a combination of Nvidia and Dojo, its in-house training platform.
“We believe Tesla’s comments reflect the growing complexity and model parameters of the training models, bode well for Nvidia’s data center sales in 2023/24, and are supportive of our 40%+/20%+ general purpose compute to customized compute long-term growth rates,” wrote the analysts.
Elsewhere on Thursday, Wells Fargo analysts, commenting on Tesla’s Investor Day, said the electric vehicle company targeted a 50% cost reduction for its next-gen model.
However, they feel the timeline and cost details were limited, and the event “lacked a TSLA-like surprise.”
“With high expectations, we expect the stock to trade down,” wrote the analysts. Tesla shares are currently more than 5% below Wednesday’s close.
