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Analyst: A Hedge Against Oil, Tesla Motors to $70

Could Tesla Motors be the best hedge against oil?

Morgan Stanley analyst Adam Jonas moved the stock last week after issuing it an upgrade. Jonas gave the stock a $70 price target based on a 15-year discounted cash flow and his forecast for Tesla. For the stock to climb to that level, three things need to happen.

First, oil prices need to stay high and keep rising. Second, battery costs need to fall dramatically. Finally, the company's minimum liquidity levels need to remain intact through the launch of its Model S in 2012.

"Our view on Tesla is based on a long-term transformation of the company being a more volume player selling hundreds of thousands of units," Jonas said, adding that while the transformation won't be easy for Tesla, investors shouldn't judge the stock on its current offering.

"Just like automobiles back at the turn of the last century were toys for the rich, electric cars today don't make a lot of economic sense and they're toys for the rich and we think, in a large part because of what's happening with the gas prices, that is going to change pretty dramatically."

Veracruz founder Steve Cortes doesn't think Tesla will go to $70, but he does like the company.

"This isn't about cars. It's about politics," Cortes said. "They have shaken the hands with the right people in Washington. The government is behind them. I think you have to be long."

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BERNANKE VS. THE WORLD

Central banks around the world are saying the U.S. Federal Reserve Chairman Ben Bernanke has it wrong, according to Peter Boockvar, an equity strategist at Miller Tabak. Boockvar advises moving into commodities.

Watch the video to see the full conversation.

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Trader disclosure: On April 5, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Terranova Owns (VRTS), (C), (JPM), (UPL), (PBR), (TCK), (BAX), (XOM), (AKAM), (CVI) and (CNQ). Steve Cortes Owns (SDY). Steve Cortes Owns (EXC). Steve Steve Cortes Owns (SO). Steve Cortes Is Long USD, Is Short EUR. Steve Cortes Is Short (F). Steve Cortes Is Short (BAC). Steve Cortes Is Short Soybeans. Steve Cortes Is Short Wheat. Steve Cortes Is Short (CBOE).
Peter Boockvar Owns Oil, Silver and Gold.

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JOE TERRANOVA
Terranova is Chief Market Strategist of Virtus Investment Partners, LTD
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PATTY EDWARDS
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BRIAN KELLY
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ADAM JONAS
Morgan Stanley Owned 1% Or More Of (MTOR), (TSLA) As Of Feb. 28, 2011
Morgan Stanley Managed Or Co-Managed Public Or 144A Offering Of (BWA), (F), (GM), (GT), (TEN), (TSLA), (TRW) In Last 12 Months
Morgan Stanley Has Recieved Investment Banking Compensation In Last 12 Months From (BWA), (F), (GM), (GT), (MTOR), (TEN), (TSLA), (TRW)
Morgan Stanley Expects To Recieve/Seek Investment Banking Compensation From (BWA), (F), (GM), (GT), (JCI), (TEN), (TSLA) In Next 3 Months
Morgan Stanley Has Recieved Non-Investment Banking Compensation In Last 12 Months From (BA), (F), (GM), (GT), (LEA), (MTOR), (TEN)
Morgan Stanley Has Provided In Past 12 Months Or Is Providing Investment Banking Services To Or Has Investment Banking Client Relationship With (BWA), (F), (GM), (GT), (JCI), (MTOR), (TEN), (TSLA), (TRW)
Morgan Stanley Has Provided Or Is Providing Non-Investment Baning, Securities-Related Services To And/Or Has Entered Agreement To Provided Services Or Has Client Relationship With (BWA), (F), (GM), (GT), (JCI), (LEA), (MTOR), (TEN)
An Employee, Director Or Consultant Of Morgan Stanley Is A Director Of (F)
Morgan Stanley & Co. Is A Market Maker In (AN), (BWA), (CTB), (F), (GM), (GT), (GPI), (JCI), (LEA), (MGA), (MTOR), (PAG), (TEN), (TSLA), (TRW)

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