Tesla’s (NASDAQ:TSLA) Institutional Investors Backing Away
Tesla (NASDAQ:TSLA) CEO Elon Musk’s ‘420’ bid to take the fledgling EV maker private has taken another turn that has triggered trading chaos, as Morgan Stanley became the 2nd firm to suspend coverage of the stock.
Recall that last week Goldman Sachs announced that it removed its Tesla rating and price target with the disclosure that it would be advising Musk.
Morgan Stanley,long a supporter of Tesla, has not elaborated on what prompted its move.
A spokesperson for the bank, and Tesla representatives declined to comment.
Morgan Stanley’s decision to restrict coverage spurred speculation that it could be playing a role in taking the privatization bid forward and helped spur the biggest intra-day gain for Tesla shares since 7 August the day Mr. Musk set the ‘420’ deal in motion with his Tweet ‘while driving’..
Tesla’s stock spiked 5.3% Tuesday and closed up 4.4% at 321.90 in New York.
Morgan Stanley’s Adam Jonas was a longtime bull on the electric-car maker. The analyst, who had the equivalent of a hold rating on Tesla and a price target of $291, last downgraded the stock in May last year
Tuesday’s rally aside, the confusion all around Mr. Musk’s efforts have started eroding the faith even of long-time institional Bulls.
Earlier Tuesday, Consumer Edge analyst cut his rating on Tesla to equal-weight, from overweight, citing uncertain outcomes from regulatory inquiries (SEC), and potential penalties, as well as Mr. Musk’s ability to keep serving in such a broad capacity.
This is his 1st downgrade of Tesla’s stock since he began coverage in July 2016.
“It is becoming more clear that he (Elon Musk) may be stretched too thin and could benefit from a CEO and/or COO hire,” he wrote in a note to clients
HeffX-LTN’s Overall Outlook on TSLA is Neutral to Bearish
Latest posts by HEFFX (see all)
- Tesla Is Hiring Someone To Defend Elon Musk And Fend Off Attacks By Twitter Trolls - January 20, 2021
- PayPal Will Continue To Profit From A Huge Increase In Volume And Accounts - January 20, 2021
- Google’s Ethical AI Division Investigating Sharing of Sensitive Documents - January 20, 2021