Benzinga - by Rounak Jain, Benzinga Staff Writer.
Future Fund manager Gary Black has underlined how difficult it is to accurately ascertain the value that Tesla Inc.'s (NASDAQ:TSLA) Optimus humanoid robot project brings to the table.
What Happened: Black reposted a two-minute-long video demonstration of Figure AI's humanoid robot, powered by Microsoft Corp.-backed (NASDAQ:MSFT) OpenAI's large language models.
The Tesla bull referred to the increasing competition, adding that this makes it difficult to project what value needs to be attached to Tesla's Optimus project.
"Why it's difficult to add a value for Optimus to $TSLA valuation."
Why it's difficult to add a value for Optimus to $TSLA valuation. https://t.co/zPOq5Vf8pm— Gary Black (@garyblack00) March 15, 2024
Black argued that an analyst needs a working product that can be compared to competitive products, a use case, and a Total Addressable Market (TAM) from which one can forecast market share.
On the other hand, Ark Invest's Cathie Wood has included Tesla's Optimus, FSD, and other AI projects to arrive at valuations. Black says his conservative estimates are due to his "discipline."
"My conservative approach is not because I'm a baby boomer. It's about discipline."
X investors always give us grief for not including robotaxi, FSD licensing, or Optimus valuations in our PTs. That discipline has worked well for us so far in avoiding posting outlandish price targets based on arbitrary assumptions. As an analyst, there has to be a working…— Gary Black (@garyblack00) March 14, 2024
Why It Matters: Black’s comments come in the wake of Tesla’s ongoing efforts to develop Optimus, its own bi-pedal, humanoid robot. Tesla CEO Elon Musk has previously expressed optimism that robots will one day build other robots.
In a recent development, Musk welcomed competition from OpenAI, Microsoft, and Jeff Bezos, who invested $675 million in Figure AI, which is working on building an autonomous humanoid robot.
Optimus is Tesla’s own humanoid robot. The company equipped it with better hands in December, allowing it to grab delicate objects like an egg without crushing them.
Although Musk thinks robots will one day build other robots and Tesla cars, among other things, Optimus still cannot find a missing sock, and it has been in development for two years now.
Price Action: Tesla's stock closed at $164.30 on Thursday, up 1.11%, according to Benzinga Pro.
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