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- Veteran investor Ross Garber told Yahoo Finance that Tesla’s struggling stock price could recover if CEO Elon Musk changes his actions or is replaced.
- Gerber said Musk’s behavior on X (formerly Twitter) has turned him into an “advertising fiend.”
- His comments follow Wells Fargo’s recent downgrade of Tesla stock, which lowered its price target to $125 per share.
To correct Tesla’s plummeting stock price, CEO Elon Musk needs to change his behavior or be replaced, longtime investor Ross Gerber told Yahoo Finance.
He said, “If Tesla gets a real CEO who can actually help the company, or if Elon changes his attitude and goes back to actually working for Tesla and promoting the brand in a positive way, this… The situation could improve very quickly.”
The electric vehicle maker has fallen more than 36% since the beginning of the year, but the decline comes amid disappointing earnings, a lackluster product lineup and broader market headwinds.
Wells Fargo on Monday lowered its price target for the company to $125 per share, implying a 23% downside from current levels. The bank characterizes Tesla as a “growth company with no growth,” and expects earnings per share to be 32% lower than expected this year.
For investors like Gerber, dissatisfaction with Musk’s leadership and public behavior has reached a crescendo. This has been a point of contention ever since the CEO acquired Company X (formerly Twitter).
Whereas previously, Musk’s popular tweets about Tesla had effectively saved the company marketing costs, Musk’s actions on social media platforms have become increasingly controversial and hurt the automaker. Mr. Gerber has repeatedly pointed out that
In fact, last November, Musk’s interaction with anti-Semitic posts prompted Gerber to announce that he would replace Tesla’s Model Y with Tesla’s competitor Rivian. That’s a harsh comment from an investor who was once eyeing a seat on the company’s board.
“I think investors have had enough. I see a fallacy in this business model: The king of brand advertising has now become the demon of brand advertising,” he told Yahoo on Thursday. .
Even more discouraging is Musk’s plan to develop an artificial intelligence effort separately from Tesla, which would take away Tesla’s ability to increase its dominance in the technology field.
Meanwhile, Tesla enthusiast Dan Ives of Wedbush Securities believes investors’ bearishness is overdone, suggesting Tesla’s stock price could recover 77% within 12 months. There is.
To achieve this, Ives stressed the need to improve Musk’s compensation package and increase his control over the stock.
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