As the stock price plummeted, Musk fell from the throne of the world‘s richest man.
Since the beginning of this year, Tesla’s stock price has “fallen and fallen”. As of the close of U.S. stocks on December 14 local time, Tesla fell another 2.58% to $156.8, a cumulative decline of 60% during the year; the total market value was only $491.328 billion, down about $744.2 billion (about RMB) from the beginning of the year. 5,181.3 billion yuan). This is also the first time its market value has fallen below the $500 billion mark since November 2020.
Tesla’s big short, GLJ Research analyst Gordon Johnson is even more surprising: Tesla’s stock price is expected to fall to its target price of $23 by the end of next year. In other words, according to its estimates, Tesla’s stock price may still have a decline of more than 85%.
Johnson said in an interview: “We found that Tesla is just an ordinary car company with more production capacity than they can sell.” He believes that Tesla is not a technology company and should not be priced like a technology company, adding He said he expects Tesla shares to continue to face selling pressure.
It is still too early to say who will win the short and the long, but this stock price plunge, Musk may be the biggest loser so far.
Losing the throne of “the world‘s richest man” Although Tesla’s share price has basically declined throughout the year, the decline has intensified in the past few months.
Since entering Twitter on October 27, Tesla’s stock price has fallen 29%, far worse than the 6.6% increase of the S & P 500 index during the same period. As Tesla’s market value continued to shrink, Musk also lost his position as the world‘s richest man.
“Forbes” data shows that the world‘s richest man is Bernard Arnault, chairman of the luxury goods giant LVMH Group, with a net worth of US$190.9 billion, and Musk ranks second with a net worth of US$174 billion.
Not only Musk was injured, but also a group of investors. The well-known American financial media “Investor’s Business Daily” analyzed the data of S&P Global Market Intelligence and MarketSmith and found that since Twitter’s board of directors accepted Musk’s acquisition offer on April 25, including ETF giant Vanguard, BlackRock (BlackRock) Tesla’s top 10 investors, including Musk himself, lost as much as $132.5 billion.
Acquisition of Twitter causing trouble? Since April this year, Musk has been dragging back and forth on the acquisition of Twitter, and finally spent $44 billion in October. Behind the acquisition of Twitter, Musk also dumped Tesla stock many times.
SEC documents show that Musk sold a total of 22 million Tesla shares from December 12 to 14, worth $3.58 billion. Previously, Musk held about 446.2 million shares of Tesla. Based on this calculation, the number of shares sold this week accounted for nearly 5% of his total holdings, which is a relatively high proportion. In addition, according to BBC statistics, in the past year, he sold Tesla shares totaling nearly 40 billion US dollars.
But the industry is not optimistic about this business. Since Musk officially acquired Twitter on October 27, there have been rounds of topics such as rectification of management, layoffs, and Twitter transformation, but this has not helped Tesla’s stock price. Since the acquisition, Tesla’s share price has fallen by 30%.
SEC filing.
According to foreign media reports, in order to promote the Twitter reform, Musk also mobilized his companies to provide support, authorizing the executives of SpaceX, Tesla and Boring Company to work on Twitter. Investors worry that Musk’s acquisition of Twitter may affect his work at Tesla, and he may sell more Tesla shares to support Twitter.
Tesla’s stock price keeps falling. Liao Koyuan, Tesla’s largest retail shareholder who once called himself a “fan” of Musk, called on the company to increase the stock price by repurchasing shares. On December 12, Liao Koyuan even complained: “Musk has given up on Tesla, and Tesla has no CEO.”
In addition, Musk’s tweets made enemies everywhere, which attracted a lot of criticism. Kristin Hull, founder of Nia Impact Capital and Tesla shareholder, criticized on Twitter: “There are many problems with the Tesla brand, and the board of directors cannot control the CEO.”
“Elon is a great business leader. But he will soon realize that his polarizing political views are hurting customers’ perception of Tesla,” Tesla bull Gary Black tweeted Wednesday. “Customers don’t want their car to be controversial, they want pride in their car, not embarrassment.”
Bullish and bearish, institutions have different views Judging from various signs, investors’ concerns are not unreasonable. In terms of sales volume, Tesla has been surpassed by BYD this year, losing the throne of the global sales champion of new energy vehicles.
The mass production of new cars has not been smooth. The Tesla electric pickup Cybertruck released in 2019 has received more than 1 million orders in more than two years with its sci-fi shape. But the delivery time has repeatedly skipped tickets, being surpassed by competitors Rivian R1T and Ford F-150 Lightning pickup.
Tesla shares have lagged major automakers and technology companies such as General Motors, Ford, Apple and Amazon this year.
Currently, some investment banks are pessimistic about Tesla’s prospects. RBC lowered its price target on Tesla to $225 from $325. In its latest report, Goldman Sachs lowered its price target on Tesla to $235 from $305, citing weak demand. In addition, Goldman Sachs also lowered Tesla’s delivery forecast for the fourth quarter.
Morgan Stanley analyst Adam Jonas also said in the latest report that the adoption of electric vehicles in the United States will be much slower in the next few years than previously expected. Jonas currently expects EVs to account for 11 percent of the U.S. auto market in 2025 and 26 percent in 2030. That’s lower than his previous forecasts for U.S. EV penetration of 13 percent and 32 percent, respectively.
Still, Jonas said Tesla stock remains his top pick for 2023. He said: “Tesla is the only company that can sell electric vehicles at such a high profit margin and has an unprecedented position in the battery supply chain. With the launch of the Cybertruck and Semi in 2023, the company is on the way expanding its automotive lineup.”
Some investors also believe that now is a good opportunity to buy Tesla stocks. On December 14, Cathie Wood, founder and CEO of Ark Investment Management, bought nearly 75,000 Tesla shares.
Wood, who is known for his bold investment, has been buying Tesla’s stocks since October, and has been increasing his positions in the currency circle since November. She has always emphasized that electric vehicles and the encryption market are the mainstream trends in the future. Tesla stock is one of the major holdings of Ark’s main fund. Ark currently holds about 0.13% of Tesla’s shares.
In addition, public information shows that as of September 30 this year, Tesla’s main institutional investors include Vanguard Group, Blackstone, State Street Bank, Northern Trust, and JPMorgan Chase, etc., and these institutions are still increasing their holdings of Tesla in the third quarter. Pull the stock.
As for Tesla’s stock price falling endlessly, Jiang Han, a senior researcher at Pangoal Institute, told Times Finance that Tesla’s stock price was overvalued before, and the market is optimistic about the new energy track behind it, and there is also a certain degree of blindness. Compared with traditional car companies such as Toyota, Tesla’s performance fundamentals are relatively insufficient, and only sustained high growth can support its overvalued stock price.
“From a long-term perspective, Tesla’s development requires a process of value return. The further squeeze out of the stock price bubble can promote the overall development of Tesla. But Tesla also needs to pay attention, if the stock price falls further , will damage its financing ability to a certain extent and bring risks to the company.”