“Our investor survey reinforces our views that Elon Musk's recent involvement with Twitter has contributed to negative sentiment momentum in Tesla shares," said Morgan Stanley analyst Adam Jonas.

Tesla (TSLA) investors see Elon Musk's purchase of Twitter as having both a negative impact on the carmaker's share price and the potential to ultimately erode its underlying fundamentals, a Morgan Stanley survey indicated Tuesday.

Morgan Stanley analyst Adam Jonas, a long-time Tesla bull, noted the bank's recent investor survey found that nearly two-thirds of those polled said Musk's $44 billion purchase of the social media platform would have a "slight negative" or "very negative" impact on Tesla's business. Around 30% felt Musk's involvement would be "neutral" for the carmaker, while only 5% saw it as a net positive.

Jonas, who carries an 'overweight' rating with a $330 price target on Tesla stock, said last week that while the ongoing distraction of CEO Elon Musk's foray into Twitter will likely expose investors to added risks, the group remains on pace to grow sales by around 37% next year, generate $15 billion in free-cash-flow and consolidate its position as the word's dominant EV player.

“Our investor survey reinforces our views that Elon Musk's recent involvement with Twitter has contributed to negative sentiment momentum in Tesla shares and could drive some degree of adverse downside skew to Tesla fundamentals.”

Tesla shares were marked 1.4% higher in pre-market trading Tuesday to indicate an opening bell price of $185.53 each, a move that would still leave the stock down more than 50% since Musk made his intentions to buy Twitter public in early April.

Last week, Citigroup analyst Itay Michaeli lifted his rating on Tesla to 'neutral' from 'sell', while boosting his price target by around $35 to $176 per share, arguing the stock's year-to-date decline of around 58% has "balanced out the near-term risk/reward" for Tesla investors.

"To be sure, macro/competitive concerns are likely to remain an overhang with capacity rising, but as we’ve previously written, in a hard landing scenario Tesla’s long-term competitive position likely also improves and potentially further enhanced by (President Joe Biden's inflation reduction act)," Michaeli wrote.

Full article: https://www.thestreet.com/markets/tesla-sentiment-fundamentals-affected-by-musks-twitter-purchase

‘Elon Musk's recent involvement with Twitter has contributed to negative sentiment momentum in Tesla (TSLA) shares,’ said Morgan Stanley analyst. Do you agree?

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VisualMod t1_iy85qjs wrote on November 29, 2022 at 1:51 PM

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>Yes, I agree that Elon Musk's involvement with Twitter has had a negative impact on Tesla shares. This is due to the fact that investors are concerned about how much time and energy he will be able to devote to running his business if he is also managing an active presence on social media. Additionally, many people feel uncertain as they try to predict what effect this move may have in terms of long-term fundamentals for Tesla - such uncertainty can often lead directly or indirectly result in lower share prices for publicly traded companies like TSLA.