“Bitcoin is the smart move at the right time for Tesla in our opinion, but on the downside it plays with firecrackers and risk and volatility add to Tesla’s story,” said Daniel Ives, technology analyst at Wedbush Securities, which remains bullish on Tesla shares.
Model Y pricing
Last Thursday, Tesla slashed the price of the cheapest version of its Model Y and top-selling Model 3 cars by $ 2,000. That brought the price of the “standard range,” Model Y, the one that can go 244 miles on one charge, to $ 38,490 – and the standard range Model 3 to $ 34,590.
But over the weekend, the cheaper “standard range” version of the Model Y vanished from Tesla’s sales site, leaving only the more expensive long-range and performance versions of the SUV. Tesla did not explain his decision.
“We see the plausible reasons as follows: the mix was too skewed towards the cheaper variant, and so that was going to kill their margins, or more likely there just wasn’t much demand for the lower variant,” said Gordon Johnson of GLJ Research, one of the more bearish critics of Tesla stocks. He said the recent price drops and other price drops show Tesla vehicles don’t have the demand his fans claim.
“Tesla cannot keep its current factories at full capacity without … price cuts,” Johnson said in a note Monday.
Established automakers recently set ambitious targets for their own sales of electric vehicles.
These efforts are making some Tesla investors nervous, Ives said, although he believes the switch to electric vehicles will be enough for several winners among global automakers.
Investors got ahead
On the Jan. 27 earnings conference call, Musk also spoke about a shortage of batteries needed to power electric vehicles. He said that even with Tesla’s internal battery supply and its planned expansion of battery production, the company is scrambling to find the batteries it wants to build more vehicles.
“The fundamental limit of electric vehicles today, in general, is the total availability [battery] For example, Musk said Tesla would have already started producing a semi-tractor if he had the batteries available to do so.
Stocks are still on the rise
Tesla shares rose 743% to lead the market in 2020 as investors embraced the idea that the future of the auto industry will be electric. Tesla remains by far the most valuable automaker in the world, with a market value well above that of the eight largest automakers combined.
Some investors believe Tesla’s stock has soared too high. Still, many analysts believe Tesla will rebound. Ives has a 12 month target price of $ 950.
Even so, he has a warning: “It’s ‘buckling the seatbelt’ again for Tesla’s stock with more volatility on the horizon,” Ives said.