Source- Supernews
Tesla, the electric car giant helmed by Elon Musk, faces a grim forecast as hedge fund manager Per Lekander predicts the possibility of the company going bankrupt, accompanied by a sharp decline in Tesla’s stock price to as low as $14. Lekander’s comments follow Tesla’s underwhelming performance in the first quarter, with vehicle deliveries falling significantly below market expectations, fueling concerns over the company’s future prospects.
Analyst Warns of Potential Bankruptcy
Per Lekander, managing partner at Clean Energy Transition has been shorting Tesla’s stock since 2020, anticipating a downturn in the company’s fortunes. He foresees Tesla’s business model facing severe challenges, particularly due to stagnant revenue growth and a reliance on outdated vehicle models. Lekander suggests that Tesla’s stock valuation, currently around 58 times forward earnings, is unsustainable, advocating for a reevaluation based on more conservative metrics.
Criticism Mounts Amid Disappointing Performance
Tesla’s lackluster first-quarter delivery figures have intensified scrutiny from analysts and industry observers. Richard Windsor, founder of Radio Free Mobile, criticized Tesla’s lofty valuation, deeming it “ludicrous” amidst rising competition and operational setbacks. Dan Ives of Wedbush Securities described the quarter as “an unmitigated disaster,” warning of potential disruptions to Tesla’s long-term narrative if performance does not improve.
Divided Opinions on Tesla’s Future
While negative sentiments towards Tesla are growing, the stock remains a polarizing topic on Wall Street. Cathie Wood’s Ark Invest recently purchased Tesla stock, signaling confidence in the company’s long-term prospects. Analyst Tom Narayan of RBC Capital Markets remains optimistic, attributing Tesla’s challenges to temporary factors and emphasizing the potential of its energy storage business and autonomous driving technology.
Near-Term Catalysts Amid Uncertainty
Despite the prevailing pessimism, analysts highlight potential catalysts that could bolster Tesla’s performance in the near term. Tesla’s recent directive to employees to promote its Full Self-Driving (FSD) system and the launch of a free trial offer present opportunities to attract customers and boost sales. Additionally, advancements in autonomous technology could position Tesla as a software-centric company, potentially altering its valuation dynamics.
As Tesla navigates through a turbulent period marked by operational hurdles and investor skepticism, the company faces a critical juncture in its trajectory. The divergent views on Tesla’s future underscore the complexity of the electric vehicle market and the challenges inherent in sustaining growth and profitability in a rapidly evolving industry landscape.
