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Tesla, Nvidia, and AI: Dan Ives' 2025 Tech Preview

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Bloomberg Jan 1 06:23 · 17k Views

Dan Ives, senior equity research analyst at Wedbush, expects tech stocks to be up 25% in 2025 as he sees a goldilocks foundation for big tech and Tesla. He speaks on "Bloomberg Surveillance."

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Transcript

  • 00:00 We can talk about some of these big gains through 24.
  • 00:02 Palantir up 340%, NVIDIA up 171, Tesla up 62.
  • 00:07 Here's another one.
  • 00:08 Vistra
  • 00:09 up by 258%.
  • 00:11 That was the biggest winner on the S&P 500
  • 00:13 last year.
  • 00:14 That's the utility company.
  • 00:15 What does that tell you about the state of play in AI?
  • 00:18 It's about second, third derivatives of AII.
  • 00:20 Mean, I think the big thing is it's 2 trillion of AI cutbacks next three years.
  • 00:24 And I think look that that that's numbers that are really, I believe going to be in stone.
  • 00:29 And there's a multiplier for every dollar spent on NVIDIA chip.
  • 00:33 There's an 8 to $10 multiplier across software and across the rest of tech and infrastructure.
  • 00:38 You think about the power, the utilities, nuclear energy, names like Aqua and others.
  • 00:44 I mean, it just speaks to we're going into a new age.
  • 00:47 It's not just about big tech.
  • 00:49 I mean, to your point about small caps, I think the big sort of proven moment is
  • 00:54 the multiplier playing out.
  • 00:56 It's the rest of tech.
  • 00:57 The rest of the two is the rest of the market
  • 01:00 participate in this AI trend.
  • 01:02 That's really everything about that party.
  • 01:03 The only ones let in behind the velvet ropes.
  • 01:06 And then Mag 7, NVIDIA has been selling the picks and shovels.
  • 01:09 They've made a fortune.
  • 01:10 We've seen all the growth.
  • 01:11 Does Microsoft and Google and the like that have been spending all that money need to show some gold this year in a big way.
  • 01:16 Yeah.
  • 01:16 And I think that'll start this quarter.
  • 01:18 I think you're going to see an inflection point in the hyperscalers for for Microsoft, for Amazon, for Google in terms of what we see with more and more of those cloud workloads
  • 01:28 now showing up.
  • 01:29 And I think it's all about use cases.
  • 01:31 That's why you look at the messy of AI Palantir,
  • 01:34 you know,
  • 01:35 in terms of what they've done.
  • 01:36 That's just the first piece.
  • 01:38 Salesforce has been another
  • 01:40 software now starts to actually participate
  • 01:44 in this AI revolution.
  • 01:46 That's going to be a key theme across 2025.
  • 01:48 Remember with you know with Khan Dunn at the FTC,
  • 01:53 M&A is going to massively accelerate and that's another theme we're going to be seeing across tech.
  • 01:58 What we saw at the end of last year was a lot of these other companies sort of the
  • 02:02 side effects of AI are the actual applications.
  • 02:06 We saw them take a pause in the applications of AI and really study exactly the use cases, study the most efficient way to do it.
  • 02:13 They stop deploying as much cash.
  • 02:15 What makes you think that they can apply some of the AI technology
  • 02:19 quickly enough to keep delivering the kinds of expansion and gains in the hyperscalers to keep a 2025% return that you're expecting in 2025?
  • 02:28 That's a great point.
  • 02:29 That's all the work we do.
  • 02:30 I mean, we look at when we talk to enterprise around the world and all the, all the travel we do in, in Asia,
  • 02:36 it's showing that these use cases they're exploding
  • 02:39 for the enterprise.
  • 02:41 So as the ROI starts to continue to increase, that's why you're starting to see, you saw Palantir starting Salesforce,
  • 02:48 you can see Mongo, Snowflake and others.
  • 02:50 You can see it spread across the board on enterprise.
  • 02:53 But it began like the, the, the ships left the port.
  • 02:56 In other words, the
  • 02:57 AI CapEx is going to be there.
  • 02:59 Now 2025 is going to be about showing it,
  • 03:02 proving it in numbers.
  • 03:04 And that's why the reason we think stock tech stocks are going to be up 25%,
  • 03:08 it's not just about big tech, it's about the rest of tech participating software infrastructure.
  • 03:15 And look, I always say haters hate.
  • 03:17 The last few years that sort of been, you know,
  • 03:19 what we've seen in tech, they will continue to sort of fire in a crowd theater type situations,
  • 03:25 but I think tech continues to move higher.
  • 03:27 What predicated is this theory on the idea that there can be some sort of expansion of the H1B visas that there can be an ongoing increase in employees and
  • 03:37 and and top talent to the United States for the first time in 30 years, US is a head of China.
  • 03:42 I mean, in my perspective from when it comes to tech,
  • 03:45 but to fuel that in terms of AI revolution, it's talent.
  • 03:49 And I think what we've seen, we've definitely seen a lack,
  • 03:53 they supply demand.
  • 03:54 These companies more and more
  • 03:57 need to continue to fuel this with talent.
  • 03:59 So when you look, what we're seeing with H1B
  • 04:02 and, and ultimately is that all plays out.
  • 04:04 It will be something very, very important that plays out in Silicon Valley and across the tech world in 2025.
  • 04:11 Elon Musk has been at the forefront of this debate, this argument over the holiday period.
  • 04:16 Let's talk about Tesla
  • 04:17 tester and outlier in a pretty dreadful auto market, particularly for the European players.
  • 04:22 I think it was Stan Druckenmiller that once said you'd be surprised by how few people understand what makes a stock go up or down,
  • 04:27 what makes Tesla go up or down, Because it sure as hell doesn't seem to be car sales.
  • 04:31 It'll be something much bigger than that.
  • 04:32 And we're going to have deliveries probably in the next few hours, right?
  • 04:35 In terms of Q4,
  • 04:37 Look, I think this is this is an autonomous AI story
  • 04:41 for the next few years and it goes back to
  • 04:44 the bet for the ages that Musk made on Trump continue.
  • 04:47 I think it's going to really play out as the autonomous future.
  • 04:51 That's what you're betting on in Tesla.
  • 04:53 You don't see that in numbers today.
  • 04:56 But I think the ultimately, I think that's worth a trillion dollars more in terms of the AI.
  • 05:00 Autonomous story, but next few hours this week we'll be talking about deliveries
  • 05:04 and and it comes down to China deliveries
  • 05:08 which were really a disaster at points in the last call, 12 to 18 months have now started to rebound for Tesla and that's going to be very important.
  • 05:16 What gives you the confidence that that will continue?
  • 05:18 Because there are some similar questions happening in the luxury space with companies like LVMHS China actually
  • 05:23 bottoming out for the consumer side of things.
  • 05:25 What gives you that confidence for 25?
  • 05:26 It's what we see in terms of demand, in terms of what we see in terms of the the overall China market for EV is I think Tesla.
  • 05:34 I think a lot of those price cuts in the rearview mirror,
  • 05:36 we're going to have white knuckle moments.
  • 05:39 But ultimately, I think China is something that could be up 20% when it comes to delivery for Tesla.
  • 05:44 And that's why I think right now
  • 05:46 it's one where
  • 05:47 the, I think where the bears have sort of misunderstood Tesla.
  • 05:51 It's it's 10 to 15% of delivery story.
  • 05:54 Now it's
  • 05:54 85 to 9 percent
  • 05:56 AI autonomous.
  • 05:58 In terms of the future from Musk and Tesla, it's sort of when you put together some of the things that you're talking about, you think for the first time in 30 years, the US is actually ahead of China when it comes to development.
  • 06:07 At the same time,
  • 06:08 Tesla's dominance and success has hinged on its success
  • 06:12 in China.
  • 06:13 So how do you see the evolution in 2025
  • 06:16 of the increasing divide, the increasing isolation between China's
  • 06:21 sort of tech stack and the United States is tech stack
  • 06:24 and how those sort of
  • 06:25 both compete but also evolve in parallel?
  • 06:27 And it's a game of high stakes poker.
  • 06:29 Because the reality is, is that the reason?
  • 06:32 Jensen's godfather of AI and what we've seen with NVIDIA,
  • 06:35 where are the chips coming from, coming from China, coming from Asia.
  • 06:38 So that's why we're going to see this all play out with the China tariff discussions.
  • 06:42 I believe Musk is going to be heavily involved there.
  • 06:45 Cook, 10% politician, 90% CEO.
  • 06:48 Apple also plays a key role here,
  • 06:50 but I just believe
  • 06:52 that's something that ultimately it's not going to spoil the AI revolution trade, It's not going to spoil the chip trade.
  • 06:59 We will go through white knuckle moments, but my view and it's been the playbook the last few years,
  • 07:04 you buy the winners
  • 07:07 on those opportunities.
  • 07:08 And I think that's going to be the theme this year.
  • 07:10 Pick the winner of the year,
  • 07:11 your #1 stock pick for 25.
  • 07:13 What is it?
  • 07:13 I think to me #1 stock pick I, I think continues to be NVIDIA here.
  • 07:17 And the reason is, is that there's only one game in town when it comes to AI, it's the Godfather AI Jensen video stocks obviously sold off.
  • 07:26 I think we sit here.
  • 07:27 Them, along with Apple, will be the first ones in the exclusive $4 trillion mark cap class.