Downside in Tesla’s isn’t done

For 2 years I have written a series of posts about Tesla’s expensive share price and mostly predicting its decline. 

More importantly, it has been about knowing when to stay away but the sub title is how such stocks skew the performance of equity indices.

The headlines of my posts continually featured the words, ‘more downside’. 

In this post, I suggested that $519 would be a ‘good shakeout’.

That was in the pre 3 for 1 stock spilt money, which means $519 would equal $173 in today’s pricing.The stock price today is $157.

But I think there is ’still more downside’.
How about $82?And if so, then think of the 2nd and 3rd derivative reactions and consequences ranging from how it affects the S&P 500’s price to the potential for margin calls.

Don’t worry, if the stock price halved again, its market capitalisation will be $240 billion.

Overnight, we saw 2 Wall Street firms lower estimates and cite warnings about lower demand for Tesla’s products.
Such revisions are fine as they are part of changing one’s view and opinion but I always wonder, where were the downgrades when the stock was 60% higher?

At the $82 mark, I’ll watch for Wall Street to start placing Sell recommendations on Tesla stock.

December 15, 2022

by Rob Zdravevski

rob@karriasset.com.au

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