The problem is there is just too much insider selling even by the CEO. This coupled with a downgrade followed by an increase in debt due to all these acquisitions and the share price will be driven down. Last it did this it went from $17 to $7. This time it is difficult to guess how far it will drop. My guess $12 to $13. Long term, if you are willing to hold, it can go much higher. Of course while its down the analysts will have a field day downgrading it.
Buffet bought with $4 billion a position in BAC and said that he is willing to invest more if the bank needs cash - and that was when the share price was $8. He is still holding his position and will do so, according to him, for at least 10 years.
If that is all that this analyst can come up with in his analysis I conclude that he is an idiot. Future price is justified by future earning and revenue growth and not by a one time settlement. As long as Buffet holds the stock so will I.
Investment means long term. If every time a share price drops you sell you can end-up bankrupt or you may miss an opportunity to increase your wealth. AA is a good investment that stands to double in 2015.
Last week Tesla received an upgrade: "Shares of Tesla Motors, Inc. (TSLA) gained 3.5% on Feb 19, after a Morgan Stanley (MS) analyst provided an optimistic outlook for the electric carmaker. The share price continued to inch up in after-hours trading.
According to the analyst, the stock can reach a new record high by the end of 2015 if the Model X is launched on schedule and performs as expected. The analyst also believes that Tesla’s high capital expenditures should not be a major concern as the company has the potential to revolutionize the auto industry. In the long run, these expenditures should reap ample rewards for investors. However, the analyst did point out that Tesla might have to borrow funds if it does not curb its cash spending or commits any errors."
Today a downgrade.
Mr. Market reacts to upgrades and downgrades on all stocks not just Tesla. As an investor you have to decide whether to sell, buy, or hold. Individual opinions on this board are not worth anything especially the ones that make up statements as if they are facts.
With $6 billion in sales for 2014 and 50% growth Tesla could have revenue of $200 billion in 10 years and at 10% margin a profit of $20 billion. Note that none of the other bigger companies have revenue of $200 billion. Ellon is exaggerating or dreaming of the impossible.
There was a time when Apple that had really good products then was predicted by almost every analysts that it will go bankrupt and cannot compete against Dell or Microsoft. We all know the rest of the story. Tesla is a successful EV company with a great future. How that future unfolds nobody knows, but this company will succeed (I doubt it will ever be worth $700 billion). The reason Apple is worth that much because it has over $100 billion in cash (no debt) and generates amazing quarterly profits ($17 billion in the last quarter) whicht is an impossibility for a mini car company. One day Tesla's market cap may reach $50 billion or a share price of $400, but by that time Ford, GM, Fiat/Chrysler will have market caps much larger than $50 billion. I had invested in Tesla at $40 and sold most of my shares at $100+ and $200+. I'll be looking for a good entry point.
Manipulating the facts to downgrade or upgrade is an old game. Companies that have been downgraded and yet went on to do well: McDonald (remember the mad cow scare) - the shares went down to $16 now they are at ~$100. Apple, Amazon, etc all were downgraded at a much lower price. In other words downgrades do not mean squat except it can hurt the share price short term.