• 3 minutes THE GREAT OIL PRICE PREDICTION CHALLENGE OF 2018
  • 7 minutes Big Oil Costs Can't Go Much Lower
  • 12 minutes China’s Oil Futures Contract Is Beginning to Show Its Teeth
  • 5 hours China Tariff Threatens U.S. LNG Boom
  • 22 mins Blackouts in Australia
  • 2 mins So oil touched $80! (WTI break $71 twice). What does the future hold?
  • 5 hours Regime For Regime: China Says Willing To Provide Venezuela With What Help It Can
  • 11 hours Famous Musk's Tweet Puts Tesla Under Criminal Investigation
  • 5 mins Global Hunger Continues to Grow Driven By Climate Change
  • 18 hours Is your name Philip? No? Too bad!
  • 1 day The moves toward 'zero-manning' in oil & gas
  • 1 day Jan's Electric bike replaces electric cars
  • 1 day Funding Secured: Saudi Wealth Fund to Invest $1 Billion in Tesla's RIval Lucid to build its EV factory
  • 1 day Making Safe Nuclear Power from Thorium
  • 1 day Permian already crested the productivity bell curve - downward now to Tier 2 geological locations
  • 15 hours WTI now at $70+ headed for $50s
Tsvetana Paraskova

Tsvetana Paraskova

Tsvetana is a writer for the U.S.-based Divergente LLC consulting firm with over a decade of experience writing for news outlets such as iNVEZZ and…

More Info

Tesla Bull Switches Gears, Says Tesla “No Longer Investable”

Elon Musk

One of the biggest bulls on Tesla among analysts covering the stock is no longer recommending it as a ‘buy’, as he believes that Elon Musk’s erratic behavior in recent months is damaging the brand.

In a note to clients on Tuesday titled “No Longer Investable”, Nomura Instinet analyst Romit Shah said that while Nomura has been one of the most bullish on Tesla’s stock since it initiated coverage last October, the controversial behavior of Tesla’s chief executive is recent months has hurt the company and likely contributed to the senior management exodus.

Nomura cut its rating on Tesla to ‘neutral’ from ‘buy’, and has slashes Tesla’s price target to $300 from $400. The previous $400 target was the sixth-highest on Wall Street among 22 analysts, according to FactSet data.

“The issue though is the erratic behavior of CEO Elon Musk. During the second quarter, the switch seemingly flipped … We are worried that this behavior is tainting the Tesla brand, which in terms of value is most important,” Shah says in the note, as carried by CNBC.

The analyst cited Musk’s increased Twitter activity, the snubbing of analysts on a conference call when Musk called their questions “boring”, the NYT interview where Musk fell apart multiple times, and last week’s live video interview, during which Musk smoked marijuana.

Before that, Musk pronounced in early August that he would take Tesla private, but backtracked on that proposal two weeks later.

After last week’s live interview, Tesla’s stock tumbled on Friday, also due to the resignation of Chief Accounting Officer Dave Morton, who is quitting after just one month on the job.

Related: Hurricane Danger Lifts Oil Prices

On Monday, however, Tesla’s stock bounced back after two positive analyst reports.

Baird analyst Ben Kallo confirmed his buy rating on Tesla, saying that the stock is still worth a buy “even with drama.”

Bernstein’s Toni Sacconaghi, for his part, said that Tesla’s below $300 share price was an “attractive near-term entry” point, but the analyst remains neutral on Tesla’s longer-term performance until investors see if Tesla can pull off Model 3 quality, quantity, and profit margins.

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage

Leave a comment
  • ogden lafaye on September 14 2018 said:
    NEVER sell Elon Musk short!

    Constantly increasing production of the Model 3, erratic as it may seem at times, is still increase. You can't slow down the expenditures on future needs just to show a profit. These coming quarters are going to be a spectacular show. The stock price is gaining momentum. Hang on tight.

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News