Tesla (NASDAQ:TSLA) Market Sours on ‘Darling’ EV Maker
Tesla Inc’s (NASDAQ:TSLA) Elon Musk’s refusal to answer “boring” Wall Street analysts questions about the EV maker’s financial condition sent shares down as much as 7% Thursday and triggered concerns about its ability to raise money in the future.
Tesla’s bonds followed the shares lower and, with at least 3 brokerages cutting price targets for the stock and 8 of 27 including me now recommending “sell,” several wondered what it would now cost the company to raise more funds this year if need be.
In a conference call on Wednesday, Musk refused to answer questions from analysts on Tesla’s capital requirements, saying “boring questions are not cool.”
He instead took more than 12 consecutive questions from YouTube investment channel HyperChange TV, who had previously recommended buying Tesla shares.
Cowen analyst Jeffrey Osborne dubbed the call, in which Musk talked of “barnacles, flufferbots, and bonehead bears,” surreal, I called it duck, run and hide.
Morgan Stanley’s Adam Jonas said it was the most unusual he had heard in 20 years in the business.
“Irrespective of the Tesla CEO’s annoyance with the genre of questions he was receiving … an important part of Tesla’s success has been its relationship with the capital markets in funding its ambitious plans,” Mr. Jonas wrote in a note to clients.
“The analysts on the call represent the providers of capital that Tesla has throughout its history depended upon.”
The call came after Tesla forecast lower capital spending for the year and reiterated it would turn a profit in the 2-H of this year, recall that Mr. Musk has virtually never marked a forecast, the company remains in Production Hell, and he joked (on the square) that the company is headed for bankruptcy.
Note: Rentier businesses always fail, Tesla, Inc. is a rentier business.
My Tweet after this call:
$TSLA Consider this; what if we wake up 1 day to find that Musk’s proletariat M3 EV actually cost North of $50-K to make and is virtually hand made, the 450-K orders means Tesla is bankrupt.
|NASDAQ:TSLA||284||3 May 2018||-17.15||278.79||288.04||275.23||15,550,723|
|HeffX-LTN Analysis for TSLA:||Overall||Short||Intermediate||Long|
|Bearish (-0.36)||Neutral (-0.20)||Very Bearish (-0.50)||Bearish (-0.39)|
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