We recently published a list of 10 AI Stocks Trending on News and Analyst Ratings. In this article, we are going to take a look at where Tesla, Inc. (NASDAQ:TSLA) stands against other AI stocks trending on news and analyst ratings.
In a surprising turn of events, a consortium led by Elon Musk said on Monday that it has offered $97.4 billion to buy the nonprofit that controls OpenAI. Marc Toberoff, Musk’s attorney, confirmed that he submitted the bid for all OpenAI’s assets to its board.
The offer is a twist to Musk and OpenAI CEO Sam Altman’s rift that began last August when Musk filed a lawsuit against OpenAI. The lawsuit accused the company of putting profits before its initial nonprofit mission which aimed to advance AI in a way that benefits humanity.
The two prominent figures of the tech world are still involved in a legal battle over the future of this AI startup.
READ NOW: 10 AI News Making Waves on Wall Street and 12 High-Flying AI Stocks This Week
Analysts have been skeptical of Musk’s move ever since it came to light.
“I think it’s fair to be pretty suspicious of this considering that he has a competitor himself… which is structured as a for-profit company, so I think there’s more than meets the eye here”.
– Christie Pitts, a tech investor in San Francisco, told the BBC.
Sam Altman has this to say about the bid:
Musk was “a competitor who is not able to beat us in the market and you know, instead is just trying to say, like, ‘I’m gonna buy this’ with total disregard for the mission”.
– Altman told Axios
Plus, this is what Altman wrote on X as a reply to Musk’s bid:
“No thank you but we will buy twitter for $9.74 billion if you want.”
OpenAI was cofounded by Musk and Altman in 2018 as a non-profit, with Musk leaving before the company took off. Musk’s lawsuit against OpenAI and Altman says that the founders originally approached him to fund a nonprofit focused on developing AI to benefit humanity. However, it was now focused on making money.
“It’s time for OpenAI to return to the open-source, safety-focused force for good it once was. We will make sure that happens.”
-Elon Musk
On the contrary, Altman said that he has no interest in the offer, stating that OpenAI is not for sale.
For this article, we selected AI stocks by going through news articles, stock analysis, and press releases. These stocks are also popular among hedge funds.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Tesla, Inc. (NASDAQ:TSLA)
Number of Hedge Fund Holders: 99
Tesla, Inc. (NASDAQ:TSLA) is an automotive and clean energy company that leverages advanced artificial intelligence in its autonomous driving technology and robotics initiatives. On February 11, Oppenheimer analyst Colin Rusch reiterated a “Perform” rating on Tesla, stating that Musk’s bid for OpenAI is a distraction for the company. On February 10, an Elon Musk-led group offered $97.4 billion to buy the nonprofit that controls OpenAI. Seemingly an attempt to block the AI startup’s transition to a profit firm, Altman posted on X: “no thank you but we will buy Twitter for $9.74 billion if you want”. Meanwhile, analysts at Oppenheimer believe that this bid is only a distraction considering Tesla has now shifted its focus to being a physical AI play.
“While Tesla has shifted its focus to positioning as a physical AI play, we view Elon Musk’s bid for OpenAI as a distraction from Tesla’s core challenges [while] the bid, coming at a 38% discount to OpenAI’s October 2024 capital raise, is unlikely to lead to meaningful discussions. We see increasing risks to [Wall] Street estimates for Tesla as competition in the [electric-vehicle and autonomous-vehicle] markets continues to intensify”
-Oppenheimer analyst Colin Rusch.
Overall, TSLA ranks 8th on our list of AI stocks trending on news and analyst ratings. While we acknowledge the potential of TSLA as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than TSLA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap
Disclosure: None. This article is originally published at Insider Monkey.
