Tesla CEO Elon Musk has suffered a significant setback as the company’s shares took a hit due to an analyst downgrade and underwhelming quarterly reports from smaller electric vehicle competitors.
On Thursday, Tesla’s stock price plummeted by 5.5% to $210 after HSBC analyst Michael Tyndall gave the stock a sell rating and set a target price of $133. This downgrade reflects growing investor caution towards Tesla’s volatile stock, which has experienced fluctuations in recent months.
The sell rating comes at a time when Tesla is grappling with various challenges, including increased competition, rising costs, and disruptions in its supply chain. Additionally, the company is under scrutiny from regulators worldwide regarding its self-driving technology and safety concerns.
According to Forbes Magazine, other electric vehicle stocks are also on the decline. American electric car makers Rivian and Lucid saw their shares drop by 10% and 5% respectively after disappointing earnings reports. Both companies are projected to burn through billions of dollars in cash this year.
Forbes estimates that Elon Musk, who owns approximately 13% of Tesla shares, lost $8.7 billion on Thursday. This decline is more than $7 billion larger than that of any other billionaire. Despite this setback, Musk still retains his status as the world’s wealthiest individual, with an estimated net worth of $223.7 billion. However, this figure remains approximately $100 billion below his peak fortune of $320 billion in November 2021, when Tesla’s valuation exceeded $1.2 trillion.
