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Elon Musk Hires Meme-Maker To Handle Tesla's Social Media

24 May 2019

Tesla's stock fell 3.8% to $203.03, bringing its loss to 11% since the National Transportation Safety Board said on May 16 that the Autopilot system was engaged during a fatal collision of a Model 3 on March 1, in at least the third deadly USA crash reported involving the driver-assistance system.

Morgan Stanley has cut its worst case scenario forecast for shares in the electric vehicle maker Tesla from $97 (£76) to just $10 due to fears that it could be entangled in the USA's trade war with China. All of this came after Tesla had difficulties producing the Model 3.

As with previous price adjustments, Tesla said in a statement that like other vehicle companies it periodically adjusts prices and available options.

Adding pressure on Tesla's stock, Wedbush analyst Daniel Ives on May 19 cut his price target to $230 from $275, while maintaining his neutral rating.

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Bizarrely, the company's attempt to fine-tune the equilibrium price only took place after a modest price hike which was immediately reversed: Reuters reported that according to a Tesla spokesman "Last week, we raised U.S. Model 3 prices by 1%".

The spread of its yield over Treasury securities, a gauge of the added compensation demanded by investors for holding Tesla rather than safer government debt, widened to almost 693 basis points.

Shares head towards $200 for first time since 2016, as key analyst warns $10 is possible.

"We give Tesla credit for tapping into the world's largest EV market for a number of years" in China, Mr Jonas said. That is up from around 36% earlier this month. Jonas kept his main price target for the stock at $230 and also has a bull-case valuation of $391. The bond price dropped below 83 cents on the dollar and was one of the biggest losers in the high-yield market Monday, according to Trace.

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Jonas also pointed to the potential that the share action may just push the company in a different direction to generate value in the years ahead, raising the prospect of a sale that would fit with its Silicon Valley startup profile.

"FAANG stocks continue to dominate the list of most shorted US equities. but Tesla continues to hold the number 1 or number 2 spot since 2016", according to financial technology and analytics firm S3 Partners.

"As Tesla's share price declines, the likelihood of the company potentially seeking alternatives from strategic, industrial, financial partners rises".

This story has been published from a wire agency feed without modifications to the text.

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Elon Musk Hires Meme-Maker To Handle Tesla's Social Media