a-look-at-the-tesla-phenomenon-from-a-skeptical-analyst’s-view

A Look at the Tesla Phenomenon From a Skeptical Analyst’s View

TSLA) as most weeks have in 2020, by adding more muscle to the share price. The newly 5-1 split stock caught investors’ imagination who pounced on the “cheaper” shares and kept up the monumental rally in the week’s first session. Since Monday, however, the high flying stock has spent a rare couple of days in the red, nearing an 18% correction.” data-reactid=”12″ type=”text”>The week began for Tesla (TSLA) as most weeks have in 2020, by adding more muscle to the share price. The newly 5-1 split stock caught investors’ imagination who pounced on the “cheaper” shares and kept up the monumental rally in the week’s first session. Since Monday, however, the high flying stock has spent a rare couple of days in the red, nearing an 18% correction.

Joseph Spak shared his thoughts on what is undoubtedly one of the stock market’s most controversial names.” data-reactid=”13″ type=”text”>With a new triple digit share price sitting alongside the TSLA ticker, RBC analyst Joseph Spak shared his thoughts on what is undoubtedly one of the stock market’s most controversial names.

The analyst believes there are several angles from which to observe the Tesla phenomenon.

There’s Tesla “the company,” disrupting the auto industry by “pushing vehicles towards electrification,” having established a “compelling and desired brand.” Here there’s no avoiding the Musk Effect. The Tesla story is incomplete without its leader’s influence on consumers’ behavior, of which Spak notes the “perception of Tesla being a superior vehicle could lead to share gains and higher margins.”

Which brings us to Spak’s final point: “the valuation.” Considering Tesla’s incredible run up – up by 386% year-to-date – Spak views Tesla “as fundamentally overvalued and having to grow into its valuation.”

Despite admitting that “narrative, momentum, and other factors can impact stock price,” the analyst concludes that “ultimately a company’s value is related to the PV of future FCF.”

click here)” data-reactid=”31″ type=”text”>But what does it all mean for investors? As is so often the case with Tesla these days, it means a target price raise. The figure moves from $170 to $290. Still, there remains 29% of downside from current levels. There is no change to Spak’s rating, however, which stays an Underperform (i.e. Sell). (To watch Spak’s track record, click here)

See Tesla stock analysis on TipRanks)” data-reactid=”32″ type=”text”>Overall, Tesla continues to baffle Wall Street. Among Spak’s colleagues, Musk & Co. receive a Hold consensus rating based on 4 Buys, 15 Holds and 11 Sells. The average price target clocks in at $291.04 and suggests a 28.5% decline from current levels. (See Tesla stock analysis on TipRanks)

Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.” data-reactid=”41″ type=”text”>To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.

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