Elon Musk Says Optimus Will Be a $10 Trillion Business. Here Are 2 Industrial Stocks That

Elon Musk has never been shy about making bold predictions. But his latest may be one of the biggest yet.

The company is preparing to begin production of its first manufacturing-ready Optimus units this summer, while analysts expect robotics to dominate the company's long-term earnings discussion. Whether Optimus ultimately reaches that valuation is impossible to predict.

What Happened

But you don't necessarily need to own Tesla to profit if humanoid robots become commonplace. Every robot deployed into a factory, warehouse, or distribution center will require automation software, motion controls, machine vision, sensors, and factory management systems.

• Musk believes Tesla's (NASDAQ: TSLA) humanoid robot, Optimus, could eventually become a $10 trillion business, calling it potentially the company's most valuable product ever.

• Management continues targeting free cash flow conversion of roughly 100%, return on invested capital above 20%, and earnings growth that outpaces revenue growth over the long term.

• Now, it’s worth noting Stock Advisor’s total average return is 965% — a market-crushing outperformance compared to 215% for the S&P 500.

Key Details

So here are two that could benefit regardless of which robot manufacturer ultimately wins. If factories become increasingly automated, someone has to connect everything.

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Why It Matters

And that's what Rockwell Automation(NYSE: ROK) does. The company provides programmable logic controllers, industrial software, motion control, sensors, safety systems, and factory automation solutions used by manufacturers worldwide.

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What Reports Say

Coverage of the story so far points to:

• Continued reporting by The Globe and Mail as more details emerge