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After earlier predicting a bear target price for Tesla, Brian Johnson recently made more negative comments on the company’s stock and sales. TSLA stock is up today.
Barclays auto analyst Brian Johnson recently made bear comments on Tesla Inc (NASDAQ: TSLA) and the possibility of a fourth-quarter stock plunge.
Earlier in February, the analyst predicted a $300 bear price target on the shares of Electric Vehicle (EV) makers. However, the automaker has been increasing its sales and stock price. With Tesla trading at a pre-market price of $1,646.01 and at a $1,613.16 price as the market opened, the company is still performing well above Johnson’s bear price target.
At the time of writing, TSLA stock is 1.13% up.
Bear Comments on Tesla Stock
On Wednesday, 23rd July, Tesla announced its 2020 second-quarter earnings results, which performed above analysts’ predictions. The company said that it pulled in $104 million in net income, $2.18 in earnings per share, and a whopping $6.04 billion in revenue against the expected $5.37 billion. The recent quarter marks Tesla’s fourth straight quarter of profits, and this may be one of the catalysts Tesla needs to join the $1 trillion club.
Regardless of Tesla’s successes, Johnson believes that TSLA could see a major fall in the fourth quarter. Although Johnson predicts a crash, he doesn’t think it would happen in the near future:
“So I’m not under…(the) illusion that even though my $300 is based on valuation of this automaker that the market is going to agree with me… anytime soon.”
Despite the bear comments, Tesla’s stock presently boasts of a significant increase. Since January, Tesla’s stock has jumped over 280%, with an increase of almost 600% in the last twelve months. With its current premarket price, TSLA is above 4% over its previous close of $1592.33.
More Negative TSLA Predictions
Out of the 500,000 vehicles that Tesla planned to deliver in 2020, the EV company delivered 179,387 in the first two quarters of the year. As a result, Johnson believes it might be impossible for the electric automaker to meet its target. The analyst added:
“He (Elon Musk) did say half a million was still the target but my target is to finish a marathon in under three hours and I don’t think I’m going to get there.”
In March, Tesla began the delivery of its electric SUV, Model Y, which increased the stock by 3% in premarket shortly after the company reduced its price by $3,000. Recently, the company also announced Austin, Texas, as the location for its next U.S. factory. Upon completion, the Austin factory will cater to the Cybertruck, Models 3 and Y, as well as the Semi, for the Eastern half of North America. The factory in Fremont, California, will handle production of the Models S and X for the general market. In addition, it will also cater to Models 3 and Y production for the Western half of North America.
While Model Y sales have been good, Johnson believes this success is affecting sales of the Model 3:
“At some point we think that the growth narrative could come undone. That will be perhaps closer to the second half or 4Q when it becomes apparent that Model Y might be cannibalizing Model 3 sales and when we see just what the run rate of demand for Model 3 really is.”
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