William Blair analyst Jed Dorsheimer was all praise for Tesla Inc (NASDAQ: TSLA) $16.5 billion chip supply agreement with Samsung Electronics in an interview with CNBC today, but he won’t recommend buying the EV stock still.
On Monday, the multinational announced one of its largest long-term tech partnerships to date that centers on Samsung’s new Texas-based fab, which will manufacture TSLA’s next-gen AI6 chips – custom silicon designed to power everything from FSD systems to the Optimus humanoid robot.
The company’s billionaire chief executive, Elon Musk, emphasized the strategic importance of the Samsung collaboration, even stating he’d “walk the line personally” to accelerate progress.
Alongside Tesla stock, the announcement sent Samsung shares up some 7.0% on Monday as well.
Why is the Samsung deal a positive for Tesla stock
Jed Dorsheimer sees the Samsung partnership as a significant positive for TSLA shares.
“Most investors want to see Elon do what Elon does best, which is innovate – and this certainly is a data point for that,” the William Blair analyst told CNBC on Monday.
Tesla’s valuation includes core business segments like automotive and energy, but the moonshot businesses – robotaxis, humanoid robots, and artificial intelligence (AI) infrastructure – do carry significant weight in investor expectations.
According to Dorsheimer, Samsung’s deal reinforces the automaker’s commitment to those futuristic ambitions, offering tangible progress toward commercialising its advanced tech stack.
Note that Tesla Inc.’s team-up with Samsung arrives shortly after billionaire Elon Musk said it was “game on” for the company’s AI future.
Why Dorsheimer still rates TSLA shares at market perform
While the Samsung deal sure is positive for Tesla shares, Dorsheimer remains cautious.
On “The Exchange”, he cited worsening fundamentals in the company’s core automotive business, including margin compression and the loss of regulatory credits worth nearly $3 billion.
“That just makes the business more challenging,” he argued during the interview, noting that while energy is improving, the auto segment remains under pressure.
The valuation gap between Tesla’s current operations and its future tech bets is widening, and without clearer visibility into scaling those moonshot ventures, Dorsheimer believes TSLA stock is fairly valued.
His rating reflects a wait-and-see approach amid execution risks and macro headwinds.
Is it worth investing in Tesla Inc?
Tesla’s chip deal with Samsung is undeniably strategic – it strengthens supply chain autonomy, accelerates AI chip development, and signals Musk’s hands-on commitment to innovation.
For long-term believers in TSLA’s vision, this partnership could be a foundational step toward realizing its AI-first ambitions.
However, near-term challenges in the auto segment persist while the valuation already prices in substantial future success.
That’s why Wall Street analysts at large recommend treading with caution in Tesla stock.
The consensus rating on TSLA shares currently sits at “hold,” only with the mean target of about $313, indicating potential downside of some 4.0% from current levels.
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