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21-05-2019, 06:28 PM.
Post: #171
RE: Tesla
Tesla shares could drop to $10 in a worst-case scenario, Morgan Stanley says
* Morgan Stanley has cut its worst-case forecast on Tesla stock from $97 to just $10, citing concerns about the company’s debt load and geopolitical exposure.
* Tesla shares are down 38% year-to-date.
* Financial services firm Baird also cut its Tesla estimates Tuesday, lowering the company’s stock to $340 from $400.

Elliot Smith
PUBLISHED 21 May 2019

Morgan Stanley cut its bear (worst-case) forecast on Tesla’s stock from $97 to just $10 on Tuesday, citing concerns about the company’s increased debt load and geopolitical exposure.

In particular, Morgan Stanley analysts said the reduction was driven by concerns around Chinese demand for Tesla products.

“Our revised bear case assumes Tesla misses our current Chinese volume forecast by roughly half to account for the highly volatile trade situation in the region, particularly around areas of technology, which we believe run a high and increasing risk of government/regulatory attention,” the research note stated.

Tesla shares fell to near $200 Monday after Wedbush cut its price target from $275 to $230 due to the potential impact of distractions from CEO Elon Musk’s “sci-fi projects” on the company’s ability to shore up demand for its core Model 3.

Shares closed down 2.7% Monday, closing at $205.36, and are down 38% year-to-date. During intraday trading Monday, the stock fell below $200 for the first time since December 2016. The stock was down 2.6% in premarket trading on Tuesday morning.

But it’s not just the Tesla bears making cautious calls. Financial services firm Baird also cut its Tesla estimates Tuesday, lowering the company’s stock to $340 from $400, while T. Rowe Price, for years one of Tesla’s biggest investors, sold around 81% of its holdings over the first three months of 2019.

Baird analysts suggested Musk’s recent email to employees announcing a “hard core” cost-cutting effort “likely compounded investor concerns over profitability,” and identified Tesla’s communication as the primary driver of share weakness, reaffirming that the “fundamentals appear solid.”

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23-05-2019, 10:56 AM. (This post was last modified: 23-05-2019, 10:57 AM by BlueKelah.)
Post: #172
RE: Tesla
I suspect Tesla might actually be break even on their cars, it's their Solar city business which is causing big losses. I suspect most of the layoffs are in that segment of the company as well. Tesla just took billions of shareholders $$ and flushed it down the drain with SolarCity and guess who benefited the most. Morgan Stanley might as well say Tesla shares are worth $0
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10-06-2019, 04:04 PM. (This post was last modified: 10-06-2019, 04:05 PM by weijian.)
Post: #173
RE: Tesla
I think of Tesla as company that has a large uncertainty in its reward vs risk curve.

For investors to have an edge to earning money on such profile stocks, I thought getting it cheap and position sizing it correctly is key.

Tesla's Travails: Curfew for a Corporate Teenager?

I did my first valuation of Tesla in 2013, and undershot the mark, partly because I saw its potential market as luxury cars (smaller), and partly because I under estimated how much it would be able to extract in production from the Fremont plant. Over time, I have compensated for both mistakes, giving Tesla access to a bigger (albeit, still upscale) market and more growth, while reinvesting less than the typical auto company. In spite of these adjustments, I have consistently come up with valuations well below the price, finding the stock to be valued at about half its price only a year ago. This year marks a turning point, as I find Tesla to be under valued, albeit by only a small fraction. Even in the midst of my most negative posts on Tesla, I confessed that I like the company (though not  Elon Musk's antics as CEO and financial choices) and that I would one day own the stock. That day may be here, as I put in a limit buy order at $180/share, knowing fully well that, if I do end up as a shareholder, this company will test my patience and sanity. (Update: My limit buy just executed. As a shareholder my risks would be much lower, if Musk was banned from tweeting...)

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