Sign up to create alerts for Instruments,
Economic Events and content by followed authors
Free Sign Up Already have an account? Sign In
Quotes
All Instrument Types
- All Instrument Types
- Indices
- Equities
- ETFs
- Funds
- Commodities
- Currencies
- Crypto
- Bonds
- Certificates
Please try another search
💎 Reveal Undervalued Stocks Hiding in Any Market Get Started
Tesla Skids as Wall Street Sees Bittersweet Path Ahead
© Reuters.
By Yasin Ebrahim
Invesing.com – Tesla faces a bittersweet near-term future as its deliveries will likely fall short of the target, but the electric automaker's cash pile will help it ride out the Covid-19 pandemic, Bernstein said.
"The company’s pain is likely to extend through the second and third quarters as the economic weakness wrought by the coronavirus pandemic could dwarf anything seen during the Great Recession," Bernstein analyst Toni Sacconaghi said in a note.
Tesla (NASDAQ:TSLA) fell 6%.
Bernstein forecasts that Tesla will miss its unit sales goal this year, pressuring revenue to fall by fifth.
Others on Wall Street agree.
"To this point, we now believe (Tesla) hitting the 500,000 unit delivery threshold for 2020 is a virtual impossibility," Wedbush said, estimating deliveries to within a 400,000 to 425,000 range.
But while many companies are desperate to build up their cash concerns on an expected slowdown in activity amid coronavirus-led recession, Tesla is not one of them as its recent equity raise gives it plenty of room to weather the storm.
"On the brighter side, Tesla's cash balance is likely to hit its lowest point of around $6.6 billion in the second quarter, and Tesla only has about $100 million of debt due this year, and is facing a $1.4 billion convertible bonds in March 2021," Bernstein added.
Tesla is expected to release the first-quarter delivery and production numbers later this week, which will provide investors with an insight into the impact from the coronavirus pandemic, especially in "the all-important China region with Giga 3 front and center," Wedbush said.
"We believe Tesla, like every other auto manufacturer, is seeing demand softness globally over the last month as consumers remain in a virtual lockdown," it added.
Related Articles
Add Chart to Comment
Confirm Block
Are you sure you want to block %USER_NAME%?
By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.
%USER_NAME% was successfully added to your Block List
Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.
Report this comment
I feel that this comment is:
Comment flagged
Thank You!
Your report has been sent to our moderators for review
Add a Comment
We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:
Enrich the conversation, don’t trash it.
Stay focused and on track. Only post material that’s relevant to the topic being discussed.
Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.
Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.