Shares of Tesla (TSLA) are on the rise after Morgan Stanley analyst Adam Jonas upgraded the stock to Overweight, a buy-equivalent rating, citing his expectations for a sooner launch of its Model 3 vehicle, less competition pressure and a "surprisingly" supportive political environment.

MODEL 3 VOLUME, LAUNCH TIMELINE: In a research note this morning, Morgan Stanley's Jonas upgraded Tesla to Overweight from Equal Weight and raised his price target on the shares to $305 from $242. Among reasons for his upgrade, Jonas cited an increased Model 3 volume estimate and accelerated launch timeline, as he now assumes a "soft" launch of the mass-market model in the fourth quarter of this year while increasing his 2018 volume estimate to 183,000 units from 114,000.

The market is moving Tesla's way on electric vehicles, the analyst argued, noting that they are no longer just a trend but a core strategy for original equipment manufacturers to address "increasingly stringent" regulatory targets. While some could argue an increase in electric vehicle offerings represents stiffer competition to Tesla's vehicles, Jonas told investors that he has yet to see another offering that competes with the company in areas of safety, performance and overall user experience. Moreover, the analyst pointed out that he sees greater risk in owning auto companies with outsized exposure to internal combustion technology rather than a pure play electric vehicle maker.

Additionally, a recent pullback in efforts by tech companies to make complete vehicles represents a "sea change in competitive pressure," which was a "great concern" to Tesla over the past two years, Jonas contended. The analyst sees Apple's (AAPL) reported scale back of Project Titan and Alphabet's (GOOGL; GOOG) formation of Waymo, whose mission is focused on making better drivers rather than better cars, as a reduction in the immediate competition for human capital for Tesla.

NEW ADMINISTRATION: Morgan Stanley's Jonas told investors that he also believes Tesla stands at the epicenter of the U.S. high tech manufacturing job creation, which may benefit more than just symbolically under the new Donald Trump administration. Noting that Tesla employs 25,000 in the U.S., the analyst pointed out that Elon Musk has an "important line of communication" to Donald Trump through his role as a strategic advisor to the President-elect. While Jonas acknowledged that he cannot apply a monetary value to this relationship, he believes this level of coordination with the new administration could evolve into "greater strategic value" than with the prior administration.

WHAT'S NOTABLE: Yesterday, Nevada governor Brian Sandoval said Tesla will manufacture Model 3 parts at the "Gigafactory." Sandoval tweeted: "Pleased to announce that @TeslaMotors will expand its investment in #NV by producing electric motors & gearboxes at #Gigafactory #nvsots."

PRICE ACTION: In morning trading, shares of Tesla have gained over 3% to $246.20.