Enough has recently changed for Tesla (TSLA -4.95%) that one prominent Wall Street analyst just raised his price target on the stock by $115 per share. Wedbush analyst Dan Ives now thinks Tesla stock could trade for $515 per share. That's a new high among Wall Street analysts, and it only represents Ives' base case.

In his most bullish scenario, Ives sees Tesla shares being worth as much as $650, according to Barron's. Tesla shares have soared 84% since the U.S. election, but Ives thinks there's still over 10% upside from where the stock trades as of this writing, even in his base case.

Game changing for Tesla

The sharp rise in Tesla shares hasn't come from major changes at the company. Instead, investors seem to believe the landscape has materially improved for the company's self-driving technology and its plans for a fleet of robotaxis. That confidence stems from CEO Elon Musk's role as a close advisor to President-Elect Donald Trump.

In his report, Ives wrote that the incoming Trump administration is a "total game changer for the autonomous and AI [artificial intelligence] story for Tesla and Musk over the coming years." He believes that policies from the new administration will help Tesla roll out its full self-driving (FSD) technology to a driverless fleet of robotaxis, as well as with subscriptions to Tesla drivers. The question for investors, though, is just how much that opportunity will be worth for the company.

Some, like Ives, believe it's enough to push Tesla to a $2 trillion valuation within the next 12 to 18 months. Investors who are buying the stock now should go in with eyes wide open, though. Any more delays or stumbles in Tesla's quest to make driverless cars mainstream will undoubtedly hit the stock price.

For those who can focus on the years and decades ahead, it still might be worth owning Tesla. Along with self-driving cars, the future of Tesla might also include growing energy-storage sales and humanoid robotics that can help businesses be more efficient. Ives seems to be trying to get ahead of the crowd with his estimates.