Tesla Stock Drops as Analysts Downgrade Rating
Analysts are downgrading Tesla’s stock rating to sell and the company’s stock price has taken a hit.
Earlier this month, Pacific Crest analyst Brad Erickson downgraded the American electric automaker’s stock to sector weight from overweight, meaning Erickson believes the stock will perform in line with other stocks he covers in the next six to 12 months. Now, Tesla’s stock has dropped over four percent in active premarket trade today, after analyst Colin Langan downgraded his rating to sell. Since April 2014, Langan had a neutral rating for Tesla stock, but now he has also cut his stock price target to $210 from $220.
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According to Langan, Tesla stock is pricing deliveries of over 1.5-million vehicles in 10 years and full utilization of its storage capacity, but he believes that Tesla’s “current planned 15GWs of storage capacity may be larger than the market in 2020.” In addition, he added that Tesla’s production of the Model X starting in the third quarter will increase production complexity, potentially causing delivery targets to be missed.
Tesla’s stock has risen over 35 percent in the past three months and closed yesterday at $282.26, nearly close to its record high of $286.04 on September 4, 2014.
[Source: Marketwatch]
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Jason Siu began his career in automotive journalism in 2003 with Modified Magazine, a property previously held by VerticalScope. As the West Coast Editor, he played a pivotal role while also extending his expertise to Modified Luxury & Exotics and Modified Mustangs. Beyond his editorial work, Jason authored two notable Cartech books. His tenure at AutoGuide.com saw him immersed in the daily news cycle, yet his passion for hands-on evaluation led him to focus on testing and product reviews, offering well-rounded recommendations to AutoGuide readers. Currently, as the Content Director for VerticalScope, Jason spearheads the content strategy for an array of online publications, a role that has him at the helm of ensuring quality and consistency across the board.
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Let's see, they have sold more cars then ever, have developed new enhancements to the current models, have new products, now and in the future, and the stock is NOW downgraded? That's ridiculous. 6-12 months ago maybe, but now? They just came off their best month and quarter. That's short-term thinking for a long-term obligation. Makes no sense