Tesla’s Price Target Slashed at Morgan Stanley

Tesla’s Price Target Slashed at Morgan Stanley March 6, 2024, 11:58 a.m., readers: 11

Morgan Stanley analysts revised downwards both the earnings forecasts and price target for Tesla (NASDAQ:TSLA), attributing the changes to a slowdown in electric vehicle (EV) demand, despite ongoing price reductions. The new 12-month target price is set at $320, down from $345, while the earnings per share (EPS) prediction was adjusted to $0.99 from the previously estimated $1.54. The analysts suggested that this year could mark a period where Tesla might face an EBIT loss in its auto segment, primarily due to waning demand concerns. This issue is pronounced outside EV-friendly areas such as California, which enjoys a 25% EV market penetration rate, similar to China's. The analysts pointed out that the real test for growth now shifts to regions in the US less prepared for EV adoption, like the suburbs around Dallas or Cleveland, where the demand, supporting infrastructure, and cost advantages are not as developed. Furthermore, in China, the EV market is experiencing an oversupply, leading to significant price reductions. This indicates a potentially competitive landscape in 2024, especially with companies like BYD slashing prices by up to 20% on their new models.

About NASDAQ: TSLA

T esla, Inc. designs, develops, manufactures, leases, and sells electric vehicles, and energy generation and storage systems in the United States, China, and internationally. It operates in two segments, Automotive, and Energy Generation and Storage. The Automotive segment offers electric vehicles, as well as sells automotive regulatory credits;

Price: 157.11
Market cap: 500.4 billion USD
Eps: 4.30
P/e ratio: 36.54
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