Wall Street lowers Tesla stock price forecast: too much growth will eventually pay off
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Elon Musk just announced that Model 3 will be put into production as scheduled, but Tesla has suffered a setback in the capital market. The day before yesterday, Goldman Sachs lowered its expected share price for Tesla in the next six months from $190 to $180. At the opening yesterday, Tesla's stock price jumped lower and finally closed with a huge drop of 7.24%. Based on the closing price of $327.09, Goldman Sachs' expectations for Tesla are equivalent to a discount of nearly half. (Photo from: techcrunch) Goldman Sachs also reiterated that it maintains a sell rating for Tesla's stock. The reason is the slowdown in sales growth of the existing models Model S and Model X, as well as concerns about potential problems in the production of the future main model Model 3. Goldman Sachs analyst David Tamberrino said on Wednesday, "We have found potential negative factors, that is, the release progress of Model 3 is lower than Tesla's production target. And the profit performance in the second half of 2017 will be disappointing because the market demand for existing models has gradually stabilized." In the second quarter of this year, Tesla delivered 22,000 vehicles, lower than the 25,000 units in the previous quarter. Tesla said the main reason was the huge gap in the production of battery packs. The importance of Model 3 to Tesla no longer needs to be explained too much. Since the first half of this year, Tesla has been concentrating on ensuring the smooth production of Model 3. In February, Goldman Sachs once lowered its stock price expectations. Since the beginning of this year, Tesla has expanded the scale of its agreement loans twice and completed a new round of equity financing. The decline in sales of Model S and Model X should be related to Tesla's focus on Model 3. Since the production of Model 3 has burned a lot of money and the sales of existing models have been affected, the financial statements for the second quarter of this year are likely to be not good. Tesla has not yet responded to Goldman Sachs's downward adjustment of expectations. The large amount of resources consumed in the mass production of Model 3 has forced it to seek equity financing to balance its debts after the loan scale has been expanded. In this way, Wall Street's short-term downward adjustment of its stock price expectations is both reasonable and should be within Tesla's own expectations. Tesla currently has more than 500,000 Model 3 orders. If it achieves a monthly production of 20,000 units as Elon Musk previously expected starting from the end of the year, and completes these 500,000 Model 3s in the next two years, it will create a new sales history for a single model. (Tesla stock price curve in the first half of this year, from: Xueqiu) But after all, this is just an expectation for the future. For short-term stock prices within one year, the greater impact is the profit level and the current valuation. Since the beginning of this year, Tesla's stock price has risen by as much as 65%, far exceeding the 8.5% increase of the S&P 500 index. With the rapid and substantial rise in stock prices, the valuation is obviously too high, and there are obvious unfavorable factors in recent profits, it is normal for the capital market to downgrade ratings and stock prices to dive. The key to Tesla's future, and its long-term stock price level, depends on the first feedback from the first batch of Model 3 owners in the next six months, and whether Tesla can promptly convert the 500,000 orders into actual deliveries and real money.As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity. |
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