Tesla Motors Inc (NASDAQ:TSLA)’s Upside Capped


Citron Research Executive Editor, Andrew Left, finds that electric vehicle maker Tesla Motors Inc (NASDAQ:TSLA) stock will find it tough to move up in near term. He believes that the news surrounding the stock will not allow share price to grow. His views come on heel of positive news for the latest Model X test drive that generated interest among the consumers, who felt that the long wait was worth it.

Underestimate the First Time

Left said that when Tesla Motors Inc (NASDAQ:TSLA) introduced its Model S, he underestimated the concept since nine out of ten stories were hailing the car as great one. As a result, the stock also jumped. In the last 52-week period, the stock hit a high of $286.65 and a low of $141.05. Of course, both the high and the low were based on the news flow, positive, as well as, the negative.

However, Citron Research Executive Editor pointed out that there is a more balanced report on the company. He also referred to the Geneva Auto Show that happened last week. Left said that the time has changed for the electric vehicle makers by saying that it would be a matter of who does not have electric vehicles in the year 2019-20 from asking whether someone has long-range electric vehicles now.

Find Incremental Buyer

Left said that it would not be easy to find the incremental buyer for Tesla Motors Inc (NASDAQ:TSLA) shares at the current levels. He admitted that right now, the information of news flow is more balanced than the earlier period. Citing the demand – supply issues, as well as, the news flow in the company, Citron Research said that it has launched a short position on Tuesday last.

Left has already tasted his success on going short in respect of Valeant Pharmaceuticals Intl Inc (NYSE:VRX) as the stock plunged more than 70% from the 52-week high. However, he said that he has covered it. Similarly, he sees the stock price of $185 – $190 as the best bet to go for the short position in respect of Tesla Motors Inc (NASDAQ:TSLA). However, he did not disclose the price range for covering the short position.

Viraj Shah

Viraj Shah has completed M.Com (Finance) and is currently pursuing his CFP. He tracks US markets along with other global markets like India very closely. He is very passionate about stocks, real estate, and technology. He also believes that money can always be made in the market.

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