Search

Tesla tumbles as coronavirus weighs on Shanghai factory - Reuters

SAN FRANCISCO (Reuters) - Shares of Tesla (TSLA.O) tumbled 19% on Wednesday, hitting the brakes on a dramatic rally after a senior executive warned the coronavirus outbreak in China would delay deliveries of Model 3 cars made at its Shanghai plant.

FILE PHOTO: A Tesla sign is seen on the Shanghai Gigafactory of the U.S. electric car maker before a delivery ceremony in Shanghai, China January 7, 2020. REUTERS/Aly Song/File Photo

With Tesla still up about 27% since the company posted its second consecutive quarterly profit a week ago, Canaccord Genuity cut its rating on Tesla to “hold” from “buy,” further shrinking the already small number of analysts who recommend buying the stock.

Tesla Vice President Tao Lin said on the Weibo social media platform that car deliveries from its new Shanghai plant would be temporarily delayed and that the company planned to restart production on Feb 10.

The $2 billion factory is a key part of Chief Executive Elon Musk’s plan to make more than half a million automobiles this year.

Tesla last week said it expected a delay of up to a week and a half in the ramp-up of Model 3 production at the plant after the government ordered it to shut the factory due to the outbreak.

The coronavirus has disrupted business across China, with the government there saying another 65 people had died as of Tuesday, the highest daily total yet.

“Given the 3,000 per week China Model 3 production expectations in a country that remains on lockdown, we feel a reset of expectations in Q1 is likely and thus needs to be reflected in the valuation,” Canaccord analyst Jed Dorsheimer wrote in a report, leaving his price target unchanged at $750 per share.

The stock was last down 19% at $716.39.

Tesla’s rally of over 300% since early June has been a vindication for Musk, who has transformed a niche car maker with production problems into the global leader in electric vehicles, with U.S. and Chinese factories.

Still, many investors remain skeptical that Tesla can consistently deliver profit, cash flow and growth in the face of competition from established rivals including BMW (BMWG.DE) and Volkswagen (VOWG.DE). Even many Tesla bulls question the stock’s valuation following its recent, electrifying surge.

Following Canaccord’s downgrade, nine analysts recommend buying Tesla’s stock, while 11 analysts are neutral and 15 analysts recommend selling, according to Refinitiv.

The median price target of analysts is $390.

Reporting by Noel Randewich; Editing by Nick Zieminski

Let's block ads! (Why?)



"Factory" - Google News
February 06, 2020 at 01:27AM
https://ift.tt/2UrBWtR

Tesla tumbles as coronavirus weighs on Shanghai factory - Reuters
"Factory" - Google News
https://ift.tt/2TEEPHn
Shoes Man Tutorial
Pos News Update
Meme Update
Korean Entertainment News
Japan News Update

Bagikan Berita Ini

0 Response to "Tesla tumbles as coronavirus weighs on Shanghai factory - Reuters"

Post a Comment

Powered by Blogger.