Tesla victim of the Covid lockdown in China, of the worsening of market sentiment that is causing especially growth stocks to capitulate, and victim, too, of Elon Musk’s Twitter fever, microblogging platform that his CEO wants to incorporate into his empire. The title TSLAwhich had gained 50% last year, and closed at $ 1,145 on April 4, the same day Musk announced it had acquired a 9.2% stake in Twitter, has since dropped by 42%, significantly underperforming the trend of the S&P 500, which contracted over the same timeframe by 13%, and also outperforming the discretionary consumer goods index of the S&P 500, slipped by 26%.
Yesterday, in the wake of strong sales that hit Wall Street again – after the Snap shock -, the electric car manufacturer’s quotations have slipped to intraday low of $ 620.57. The stock then closed the day before the session down 6.9% to $ 628.16.
Tesla: nearly half market value since November
The market capitalization of the group it has almost halved compared to that of Novemberwhen the quotes tested the record value.
And it’s certainly not good for you, in the middle of the media circus that exploded on the Twitter case, the news given by Goldman Sachs, that hedge funds would continue to reduce previously accumulated exposures to growth stocks, distancing itself from Apple, Amazon and Tesla.
There is though a hope of revenge for the Tesla title which comes from the finance star known for hoarding the stocks of the giant EV in the past: Cathie Wood, head of Ark Investment Management, that in recent months, in the wake of the change in sentiment on tech stocks, he had sold Tesla himself, while continuing to confirm his confidence in Musk’s group. ARK Innovation ETF bought 15,858 Tesla shares (TSLA)for a value of $ 10.2 million, in the session the day before yesterday, May 23.
Tesla, as we know, has fallen from the first betting spot of the Cathie Wood fund to second, yielding the scepter of the ETF’s biggest bet in Roku, last week. The third place is currently occupied by the Zoom Video Communications videoconferencing platform, which Wood continued shopping on.
Tesla does worse than all FAANGs except Netflix
Comparing with other US-made Big Techs, starting from the day Musk announced his participation in Twitter, Tesla has done worse than the former Facebook. Meta Platforms, di Apple, Amazon and the holding company to which Google belongs, that is Alphabet. Tra i FAANG, practically only Netflix has done worse than Tesla from the day of the announcement.
Among other things, the market is increasingly confused about what Elon’s real intentions are on Twitter: the interest in the platform has turned into a real one. soap opera of the world of finance and the idea that Musk has made a mistake with his roundup of statements for – but also against – Twitter is gaining ground.
Tesla’s CEO recently appeared to be turning around, where he said that more than 20% of Twitter accounts could be “fake / spam”. Last Saturday, responding on Twitter to the suggestion that “if 25% of users are bots, the Twitter acquisition deal should cost 25% less,” Musk wrote, in fact, “Absolutely.”
The result of the ongoing controversy over Twitter’s value is that the so-called deal spreador the differential between the price offered by Musk, $ 54.20 per share, and Twitter’s price on the stock exchange, equal to $ 35.76jumped to $ 18, a record high since the deal was announced in April.
That said, in addition to the Twitter distraction, Tesla was forced to pay the price of the lockdowns imposed in China.
“With a production of about 13,000 units per week and higher than average margins, any production loss in Shanghai is set to have a significant impact on margins and earnings, ”wrote Daiwa analyst Jairam Nathan, who cut Tesla’s target price at $ 800 from the previous $ 1,150.