Tesla Drops After Wedbush Lowers Price Target

Shares of electric vehicle maker Tesla were falling around 5% on Monday after analysts at Wedbush had lowered their price target on the stock from $275 to $230.

According to analyst Daniel Ives, Tesla may not be able to meet its 2019 unit guidance and that there are “major concerns” around the underlying demand for Tesla’s Model 3 vehicles. Ives maintains a “neutral” rating on the stock.

Tesla has lowered the price of its two most expensive models, cutting $3,000 from the price of the Model S sedan and $2,000 from the Model X SUV.

Tesla stated that it periodically adjusts prices and available options like other car companies.

“The business fundamentals of Tesla always have been shaky, but the stock price has been buoyed by the story that this is a company that was going to do huge things,” said Navigant Research analyst Sam Abuelsamid. “What we’ve seen in the last month or so is people are starting to recognize maybe that wasn’t really true,” he added.

“By any reasonable standard, these small changes are not newsworthy,” the company stated.
Tesla reported its worst performing financial results in the last two years for the last quarter. Sales had fallen 31%. CEO Elon Musk has projected that the second quarter would also see a loss but the company would see a profit in the third quarter.

Shares of Tesla have dropped over 38% so far this year.

Disclaimer: We have no position in Tesla Inc. (NASDAQ: TSLA) and have not been compensated for this article.