In the last week, Tesla Inc TSLA announced a recall of 123,000 Model S sedans; earned a reproof from the U.S. National Transportation Safety Board for having prematurely publicized details into a fatal Model X crash; suffered on-camera exposure of Model X Autopilot failures; and caught a Moody’s downgrade.
It’s no laughing matter, but CEO Elon Musk is taking the struggles in stride.
Tesla Goes Bankrupt
— Elon Musk (@elonmusk) April 1, 2018
Palo Alto, California, April 1, 2018 -- Despite intense efforts to raise money, including a last-ditch mass sale of Easter Eggs, we are sad to report that Tesla has gone completely and totally bankrupt. So bankrupt, you can't believe it.
There are many chapters of bankruptcy and, as critics so rightly pointed out, Tesla has them *all*, including Chapter 14 and a half (the worst one).
— Elon Musk (@elonmusk) April 1, 2018
Elon was found passed out against a Tesla Model 3, surrounded by "Teslaquilla" bottles, the tracks of dried tears still visible on his cheeks.
— Elon Musk (@elonmusk) April 1, 2018
This is not a forward-looking statement, because, obviously, what's the point?
Happy New Month! pic.twitter.com/YcouvFz6Y1
April Fools, Musk says, but his ostensible levity about the company’s setbacks doesn't resonate with wary investors. Even some of Tesla’s strongest and longest-held advocates are beginning to second-guess their bullishness.
“When we heard the recall news tonight we asked ourselves, do we still believe in the story?” Loup Ventures managing partner Gene Munster said in a March 29 note. “The answer is yes” — he still regards Tesla a leader in electric and autonomous vehicles, but his “patience is being tested.
Other investors haven’t been so forgiving. The stock is down 28 percent off its 2018 peak and struck one-year lows.
Some Street analysts anticipate continued declines on expected misses in quarterly production figures and a potential doubling of cash burn.
It’s not all doom and gloom, though. Jefferies upgraded Tesla to Hold Monday, although they aren't "quite ready to buy at current level." Barron's also made positive mention of the stock over the weekend.
The stock fell more than 4 percent in pre-market trading to $255.12 at time of publication.
Related Links:
Tesla's Cash Burn Could Double With Expected Model 3 Delays, Says Deutsche Bank
Tesla Oversold Amid AV Fears, But Still Not A Buy For KeyBanc
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