Tesla's price target has been raised by UBS analyst Joseph Spak to $226 from $197, but he maintains a 'Sell' rating due to concerns about the speculative nature of the company's AI initiatives.

Spak believes that Tesla's AI ventures, such as robotaxis and the humanoid robot Optimus, contribute nearly $1 trillion to its market capitalization, which he considers excessively optimistic.

He notes that Tesla's auto and energy divisions account for approximately $52 per share, with the rest driven by AI-related expectations.

Historically, Tesla's stock has experienced significant corrections when the tangible value of its auto segment nears 10% of the total valuation, a threshold it has recently exceeded at 12%.

On the other hand, Wedbush Securities' Dan Ives argues that Tesla is undervalued as an AI investment, highlighting the potential of its Full Self-Driving (FSD) technology as a $1 trillion opportunity.

Morgan Stanley reaffirms its 'Buy' rating for Tesla, emphasizing the company's leading self-driving technology and responsiveness to pro-charging policies in the United States.