A key analyst lowered the price target for Tesla stock Thursday. Meanwhile, scrutiny of Elon Musk has ratcheted up since he took over Twitter, with President Joe Biden suggesting Wednesday the foreign investment in Musk's Twitter purchase was "worth being looked at."
Wedbush analyst Daniel Ives, who has long been bullish on Tesla, lowered the firm's price target for Tesla stock from $300 to $250. This reflects a "lower multiple associated with the Musk overhang that gets worse by the day," Ives wrote.
"Sitting on top of the peak of the mountain with Tesla in a massive position of strength Musk has managed to do what the bears have unsuccessfully tried for years," Ives wrote. "Crush Tesla's stock by his own doing in what we view as a purely painful dark situation."
Tesla Stock
Tesla stock slipped 2% early, before spiking 7.4% to 190.72 following inflation data in Thursday's market trading. Shares fell 7.2% to 177.59 Wednesday, undercutting 2021 lows. TSLA shares are down more than 40% on the year, according to MarketSmith analysis.
Elon Musk disclosed Tuesday evening that he had sold shares worth $4 billion in the first two weeks of November, coming after he completed his $44 million Twitter deal.
Tesla stock has a Composite Rating of 44, out of 99. TSLA shares have a dismal 15 Relative Strength Rating. The EPS rating for Tesla stock is 75.
TSLA shares could also be falling along with other China-exposed stocks in the wake of stepped-up Covid lockdowns there.
In an attempt to woo customers in China, Tesla brought back an insurance subsidy Tuesday for vehicles purchased through year-end. This followed a price cut in late October as the EV giant tries to boost demand amid soaring production in China.
Twitter Distractions
Musk took over Twitter on Oct. 28. The Tesla CEO slashed roughly half of the social media site's staff while tweeting frequently about his plans and politics. Musk has also responded personally to customer complaints and suggestions.
Ives said Thursday there are real concerns that Musk is distracted from running Tesla. The analyst added there are worries he could be hurting his image, which could spill over to Tesla's brand. Tesla stock has shed around 25% since Oct. 28.
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"This is a pivotal few months ahead as the Twitter circus show is slowly starting to impact the pristine EV brand of Tesla and this could impact demand down the road in this EV arms race," Ives wrote.
The Wedbush analyst added it is a "dark comedy show with Twitter" and that Musk has "essentially tarnished the Tesla story/stock and is starting to potentially impact the Tesla brand with this ongoing Twitter train wreck disaster."
Tesla Stock: Biden Weighs In On Musk
President Biden on Wednesday was asked at a White House news conference if he thinks Musk is a threat to U.S. national security and whether possible foreign government involvement in the Twitter purchase should be investigated.
"Elon Musk's cooperation and, or, technical relationships with other countries is worthy of being looked at. Whether or not he is doing anything inappropriate, I'm not suggesting that," Biden said.
"I'm suggesting it's worth being looked at and that's all I'll say," the president added.
Saudi Prince Alwaleed bin Talal has maintained a large stake in the social media company Twitter, and Qatar also participated in Musk's $44 billion Twitter purchase.
Please follow Kit Norton on Twitter @KitNorton for more coverage.
