Tesla at $1,000: Too much too soon for some analysts

Top Wall Street brokerages Goldman Sachs and Morgan Stanley downgraded their ratings on Tesla Inc saying the electric carmaker's shares were overpriced, two days after the high-flying stock crossed $1,000 per share.

The many moods of Musk: File photo of Elon Musk, CEO of Tesla. (Representational Image) (REUTERS)
The many moods of Musk: File photo of Elon Musk, CEO of Tesla. (Representational Image)

The brokerages, while reiterating that their long-term view on the stock remains positive, noted the current valuation underestimates risks including increased competition in the electric vehicle industry.

Also Read : Elon Musk weighs in on Tesla’s stock again, this time with ‘Lol’ and a meme

Top automakers including General Motors Co and Ford Motor Co have doubled down on their investments in the space by offering more electric vehicles, aiming to cash in on a sector that is touted as the most promising alternative to conventional cars.

"We highlight risks to Sino-U.S. trade, near-term demand, capital needs and tech competition as the key bear vectors we think deserve more attention," Morgan Stanley analyst Adam Jonas said in a note on Friday.

Morgan Stanley cut its rating to "under-weight", joining 12 other brokerages who recommend selling the stock.

Following Goldman Sachs' downgrade to "neutral", Tesla now has 12 analysts with a "hold" rating, and nine brokerages recommending "buy" or higher.

Also Read : Tesla workers falling ill may trigger Elon Musk vs California feud on Covid-19

The bar for the automaker's fundamentals is higher, Goldman analyst Mark Delaney said on Thursday, while increasing the price target to $950 from $925.

Morgan Stanley cut its price target on Tesla's stock to $650 from $680, in line with the median price target, according to Refinitiv data.

Tesla's shares, which have jumped a whopping 360% in the last twelve months, were down nearly 1% in premarket trading.

First Published Date: 12 Jun 2020, 19:38 PM IST
NEXT ARTICLE BEGINS
Shopping Bag Shop Now
70% OFF
VENO Portable High Power 2 in 1 Car Vacuum Cleaner | USB Rechargeable Wireless Handheld Car Vacuum Cleaner Traveling, Camping Reusable and Sustainable (2 in 1 Vacuum Cleaner)
Rs. 899 Rs. 2,999
5% OFF
Godrej aer O – Hanging Car Air Freshener | Car Accessories | Cool Aqua (7.5g)
Rs. 94 Rs. 99
SHAYONAM Dent Removal Kit - Powerful Car Dent Repair Kit - Suction Cup Dent Puller Handle Lifter and Dent Repair Puller for Car Body Dent, Glass, Tiles and Mirror (Plastic)
Rs. 349
5% OFF
Godrej aer O – Hanging Car Air Freshener | Car Accessories | Musk After Smoke (7.5g)
Rs. 94 Rs. 99

Please provide your details to get Personalized Offers on

Choose city
+91 | Choose city
Choose city
Choose city
By clicking "View Offers" you Agree to our Terms and Privacy Policy

Dear Name

Please verify your mobile number.

+91 | Choose city
Couldn't verify the OTP.
It's either expired or it's incorrect.