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CNBC: 2 Experts See Tesla Shares Soaring Despite Wall Street Downgrade

Getty/Jerry Lampen

By    |   Tuesday, 16 May 2017 11:04 AM

Two stock-market experts reportedly see Tesla Inc.’s share price soaring higher despite a downgrade from Wall Street.

Rich Ross of Evercore ISI and Eddy Elfenbein, editor of the Crossing Wall Street blog think the stock is heading higher, CNBC reported.

Tesla shares fell by about 3 percent Monday after it lost a buy rating from one of its longtime bulls, with a Morgan Stanley analyst boosting his projection for how much cash the carmaker will burn through as more prosperous rivals encroach on its business.

Adam Jonas, Morgan Stanley’s top auto analyst, has been one of the biggest advocates for Tesla stock, envisioning offerings of a ride-for-hire service that could double the value of the company, Bloomberg reported.

He now sees operating losses continuing through next year and estimates the company will consume $3.1 billion of cash this year, compared with an earlier estimate of $2.3 billion.

“We expect much larger and more well capitalized competitors to unveil strategies that directly address sustainable transport and mobility,” Jonas wrote in a note to clients. The expansion by Alphabet Inc.’s Waymo of its self-driving Chrysler Pacifica minivan fleet and Apple Inc.’s plans to test of autonomous cars in California amount to “an assault by large tech firms” of the market, he said.

In the Monday report, Jonas maintained his $305 price target on the stock. After a nearly 50 percent rally for Tesla this year, that target now implies a decline.

Ross and Elfenbein says Tesla’s share price is heading higher. Ross, a technical analyst, says the charts continue to look bullish. "Admittedly, this is one of the most divisive stocks on Wall Street," Ross told CNBC.

"But the stock chart is far more definitive, and for me, it's still a long, with over 20 percent upside from current levels," Ross said.

On a longer-term chart of Tesla, he points to a trading range of between $180 and $280 that had been in place for the stock since 2014.

Tesla could soar to $380 in the long run.

Elfenbein says that "unconventional" Tesla cannot be looked at like any other stock.

"The stock belongs in your portfolio, a modest portion," Elfenbein said, adding, "But expect it to be very erratic, and don't expect it to follow the rules."

(Newsmax wires services contributed to this report).

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Two stock-market experts reportedly see Tesla's share price soaring higher despite a downgrade from Wall Street.Rich Ross of Evercore ISI and Eddy Elfenbein, editor of the Crossing Wall Street blog think the stock is heading higher, CNBC reported.
CNBC, Tesla, Shares, Wall, Street, Downgrade
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2017-04-16
Tuesday, 16 May 2017 11:04 AM
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