- Analysts aren’t mad at Tesla despite a market crisis that wiped out nearly $700 billion in value from its peak a year ago.
- In fact, even a well-known Tesla bear upgraded the stock, saying it’s likely bottomed out.
- “We believe the year-to-date decline has offset the short-term risk/reward trade-off,” said Citi analyst Itay Michaeli.
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Tesla stock’s nosedive has wiped out the market value of nearly $700 billion from its peak a year ago, and Wall Street is beginning to say enough is enough.
In fact, even a well-known Tesla bear has upgraded the stock to neutral from sell, stating that it has probably bottomed out.
“We believe the year-to-date pullback has offset the short-term risk/reward trade-off,” Citi analyst Itay Michaeli said in a note on Wednesday.
Here are the latest comments on Elon Musk’s Tesla from the likes of Citigroup, Morgan Stanley, and Wedbush.
Itay Michaeli, an analyst at Citigroup
Alongside the Tesla stock upgrade, Michaeli raised its price target to $176 from $141.33, though the new price target is still below last trade as they rose 8% to above $183 on Wednesday.
“Of course, macro/competitive concerns will likely remain an overhang as capacity increases, but as we’ve written before, Tesla’s long-term competitive position in a hard landing scenario is also likely to improve and potentially expand further.” [President Joe Biden’s inflation reduction act].”
Adam Jonas, analyst at Morgan Stanley
Meanwhile, Tesla bull Jonas said in a note Wednesday that shares are nearing his “bearfall” price target of $150, suggesting a potential buying opportunity at a deep discount.
He has rated Tesla shares as “overweight” with a price target of $330. While the Twitter acquisition remains a distraction for Musk and a potential risk for Tesla investors, Jonas said the company will grow revenue by 37% over the next year, generate $15 billion in free cash flow, and maintain its status as a global business should consolidate leading electric vehicle manufacturers.
“We believe that Tesla’s ‘gap to competition’ has the potential to widen, particularly as EV prices pivot from inflationary to deflationary,” he wrote. “Regarding the (Inflation Reduction Act), we believe that Tesla is by far the best positioned OEM in terms of potential eligibility for excise taxes and production credits.”
Cathie Wood, Ark Investment CEO
Wood was a Tesla super bull and had a price target of $4,600 ahead of the stock split earlier this year. In an interview with Bloomberg TV on Tuesday, she reiterated her optimism.
“A lot of people say, ‘Aren’t you worried about Tesla?’ No, we’re not because of our work on electric vehicles, they’re conquering and will continue to take a disproportionate share of what we think will account for 85% to 95% of all cars sold around the world by 2027. That’s on autopilot . He is [Elon Musk] Now we’re working on autonomous systems that we think will work.”
“We believe Tesla will do it [autonomous] on a much larger scale.”
Dan Ives, analyst at Wedbush
Then there’s Ives, who has long been a bull but has become less optimistic of late, removing Tesla from Wedbush’s “best ideas” list earlier this month due to the Twitter takeover.
In a new note, he expanded on “Twitter overhang” as a risk factor for Tesla stock:
“The problem is that while Twitter’s PR twilight zone is becoming visible to the world and advertisers remain in check while Musk’s content moderation wildcard is paramount, the perceived ‘key person risk’ overhang at Musk is a real one Overhang is on Tesla’s shares and not letting up,”
Ives also listed three key risk factors for both the stock and shareholders:
1. “Fear Musk will sell more stock to fund Twitter’s red ink.”
2. “Musk’s trademark expiration related to Tesla.”
3. “Musk’s attention is focused on Twitter instead of Tesla for now.”