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But Wall Street is not convinced, as one more analyst firm has joined the chorus against Elon Musk and slashed its Tesla stock price target.
Elon Musk’s distractions are hurting Tesla stock
Daniel Ives, an analyst investment firm Wedbush Securities, was bullish on Tesla stock once upon a time. But Elon Musk’s antics have forced him to sing a different tune of late.
Just last month, Ives lowered his Tesla stock price target to $275 from $365, stating that his firm “no longer can look investors in the eye and recommend buying this stock.” But Ives’ disappointment with Musk and Tesla seems to have reached new highs.
The Wedbush analyst has now reduced his Tesla stock price target to $230. Ives stated his concerns in a research note to clients:
With a code red situation at Tesla, Musk & Co. are expanding into insurance, robotaxis, and other sci-fi projects/endeavors when the company instead should be laser-focused on shoring up core demand for Model 3 and simplifying its business model and expense structure in our opinion with headwinds abound.
This is the second time in the space of less than a month that Ives is calling on Musk to focus on the core issues at the EV maker. The Wedbush analyst believes that Tesla faces “a Herculean task” to achieve its delivery forecast of 360,000 to 400,000 vehicles as Musk had predicted earlier this year.
Meant to say annualized production rate at end of 2019 probably around 500k, ie 10k cars/week. Deliveries for year still estimated to be about 400k.
— Elon Musk (@elonmusk) February 20, 2019
This makes it clear that the market isn’t buying the South African billionaire’s shenanigans to pump up Tesla’s stock price. Wall Street now wants results, and Musk is far from delivering them because of his antics.
Musk gets down to the brass tacks, but is it too late?
Elon Musk has been in his own pompous self for much of the year, promising Tesla investors the world. He has made absurd claims such as the launch of a million robotaxis by next year, and also telling Tesla vehicle owners that the price of their cars will appreciate once the full self-driving software update goes out.
Musk then said that the $2 billion capital that the company is raising will help in the development of self-driving cars and take Tesla stock to new highs. But as it turned out, Musk was simply putting up a brave face while Tesla was in shambles.
He has now been forced to admit that the company has only months to run, prompting Musk to aggressively streamline expenses.
Musk to review all of Tesla’s expenses in new cost cutting plan https://t.co/lftMYvH3LF pic.twitter.com/9zZdnSsH9Z
— Reuters Top News (@Reuters) May 16, 2019
But it remains to be seen if the Tesla CEO has woken up at the right time. Or is he is late in his realization that the EV maker could be going under?
The blame squarely lies with Musk as he has divided his time between his interstellar dreams, hyperloop, the Boring Company, and god knows what else. The CEO’s focus on these science projects has distracted him from the happenings at Tesla.
With Tesla stock now crumbling day after day thanks to Wall Street’s negative sentiment and key investors bailing out, Musk is finally ditching rhetoric for sincerity. But will that stop Tesla from going bust? Only time can tell us.