Goldman cuts Tesla and makes GM a buy on better sales outlook

Goldman Sachs analysts downgraded Tesla Inc. after the stock overshot their price target and bumped General Motors Co. up to a buy on a brighter outlook for global auto sales.

File photo: A Tesla worker can be seen descending from the top deck of a car carrier trailer. (REUTERS)
File photo: A Tesla worker can be seen descending from the top deck of a car carrier trailer.

While Goldman analysts led by Mark Delaney remain positive on Tesla for the long term, recent price cuts and production challenges with the new Model Y crossover cloud the electric-car maker’s intermediate outlook. GM is meanwhile well positioned to take advantage of buoyant US pickup sales and China’s recovering auto market.

Delaney cut Tesla to the equivalent of a hold while raising his price target to $950, below the stock’s $972.84 closing price on Thursday. He raise his target for GM, which finished at $26.50, to $36.

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Goldman now expects global auto sales to drop 14.5% this year rather than 17%, with demand in the US and Europe holding up better than previously anticipated. The analysts’ projection for China sales already was higher than consensus.

First Published Date: 12 Jun 2020, 08:23 AM IST
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