Ron Baron, the billionaire investor and prominent long-term supporter of Tesla, articulated an exceptionally optimistic outlook for the company’s stock in a recent interview, contending that the market continues to undervalue the magnitude of what Elon Musk is constructing. Baron has held Tesla stock for more than a decade and is recognized for predicting multiyear compounding returns from the electric-vehicle maker. He stated that Tesla employees “don’t think” Musk will achieve anything less than five- to seven-fold gains over the next decade, followed by another multibagger run thereafter. “I’m considering $2,500 regarding the future value of his stock in 10 years.” Baron indicated that the figure is likely to be quadrupled.

When inquired about the factors that might influence such an outcome, Baron directly referenced Musk’s most recent presentation. “Have you watched his annual meeting?” he inquired of the interviewer, who responded that he had not. Baron subsequently encouraged him to examine Musk’s commentary on Optimus, Tesla’s humanoid robot, which the CEO has asserted could eventually emerge as the company’s most valuable product line. “Optimus represents, in my view, the next phase of this overarching endeavor,” Baron stated. He asserted that Tesla is developing production capacity for one million units next year and 10 million the following year, with Musk envisioning a future where the company manufactures one billion units each year.

At approximately $20,000 per robot, Baron contended, the scale would be transformative. He characterized it as a transition towards “sustainable abundancy,” wherein affordable robotic labor transforms living standards. “They are expected to be light labor-saving. ‘Make everyone’s life… much better,’” he stated, noting that Musk continues to envision a long-term trajectory toward establishing a human presence on Mars. “It is conceivable that a beach could exist on Mars at some point.” Baron’s remarks come in the wake of a renewed investor interest in Tesla’s aspirations in AI and robotics, particularly after shareholders endorsed Musk’s revised compensation plan and the CEO intensified his advocacy for Optimus and full autonomy.

Analyst Federico Merendi recently referred to Tesla as a “leader in physical AI,” raising the stock target to $471. “We continue to see the company with the largest advantage in terms of autonomous driving initiatives and physical AI applications currently in the marketplace,” he wrote in a note. For Baron, the forthcoming decade of Tesla’s value creation hinges on those aspirations, rather than solely on the automotive sector.