Tesla sell-off continues on BofA bear commentary, sentiment wane

Tesla (TSLA -3.3%) shares continue to sell off after BofA issues a cautionary note on the stock going into Q3 results and reiterates an Underperform rating with a PT of $45 (a potential downside of 74% from yesterday's close).

The firm bases its valuation on a 2015 EV/EBITDA multiple of 12x. BofA's estimates are at ends with consensus expectations - most analysts expect significant demand uptake from 2015 onward.

The firm ominously observes that it is worth considering what occurs when sentiment of a momentum-driven stock shifts. Shares have retreated 15% from Oct. highs after booming 620% in the last year.

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Comments (28)
  • Dan Fichana
    , contributor
    Comments (1918) | Send Message
    BofA and Lovallo have been down on this stock since Q1.


    Didn't he have a price target of $35 or something 6 months ago?
    23 Oct 2013, 11:21 AM Reply Like
  • Randy Carlson
    , contributor
    Comments (3261) | Send Message
    So, what you are saying is that B of A just RAISED their PT by $10. That's great news, isn't it? Another analyst raises target for Tesla shares...
    23 Oct 2013, 02:20 PM Reply Like
  • Dan Fichana
    , contributor
    Comments (1918) | Send Message
    Ha , good one, never thought about it like that
    BofA targets
    Feb 2013- $30 per share
    May 2013- $37 per share
    Jul 2013 - $ 39 per share
    Now $45 per share


    BofA has been horribly wrong with the stock price in the past, but I guess if you keep on moving the target closer and closer, eventually they will hit it.
    23 Oct 2013, 03:24 PM Reply Like
  • Yarak
    , contributor
    Comments (282) | Send Message
    23 Oct 2013, 11:22 AM Reply Like
  • marshgre
    , contributor
    Comments (989) | Send Message


    You should probably see a doctor if it keeps doing that...
    23 Oct 2013, 10:09 PM Reply Like
  • Sellinpanic
    , contributor
    Comments (893) | Send Message
    Yes Yarak, if you have chronic bowel disease, it is a matter to be taken seriously. Please see a doctor asap. :D
    24 Oct 2013, 06:19 AM Reply Like
  • 123man
    , contributor
    Comments (1603) | Send Message
    Looks like a terrific buying opportunity coming up, and just in time for the 11/5 Q3 report - wasn't it B of A that needed some bailout help because they failed their consumers so miserably, I don't remember?
    23 Oct 2013, 11:24 AM Reply Like
  • surferbroadband
    , contributor
    Comments (4850) | Send Message
    Yeah they did need a bailout. That is why B of A has no credibility. Looking forward to 11/5 Q3 report.
    23 Oct 2013, 12:20 PM Reply Like
  • David G.
    , contributor
    Comments (203) | Send Message
    I see nothing to reverse the momentum. I see shorts trying to seize on any news that might be remotely skewed negative and blowing it up out of proportion.


    Bank of America has always been bearish on TSLA. Every time they comment provides a great buying opportunity for those that want in at cheaper prices.


    I must remind people that TSLA hasn't put out a press release since August 19. And TSLA sold off prior to last quarter's report as well. Then gapped much higher after results were released.


    Too much upside potential going into earnings.


    Average buy in TSLA as it falls. People will salivate if this ever again dropped below $150.
    23 Oct 2013, 11:29 AM Reply Like
  • Julian Acosta
    , contributor
    Comments (129) | Send Message
    Spot on. There has been no new, publicly available information for a few months. If you were short 2-3 months ago, your view likely has not changed. If you were long 2-3 months ago, same thing. I am considering adding to my position.
    23 Oct 2013, 11:44 AM Reply Like
  • Merrlin
    , contributor
    Comments (9) | Send Message
    To bad you are unable to see the break of the 50 ema trend line. A clear indication of a momentum trend reversal can be confirmed by volume distribution, not accumulation, as shown by the price percentage oscillator histogram, or any accumulation/distribution indicators, which have been negative for over 4 weeks. Technically, this stock has reached a top and is now correcting. I expect it should find support near the 150 ema, around $130-$132. This would still be a good time to take a little off the table and lock in some profit. Just saying.
    23 Oct 2013, 12:44 PM Reply Like
  • chfp
    , contributor
    Comments (718) | Send Message
    Setting up shorts for the slaughter...
    23 Oct 2013, 11:39 AM Reply Like
  • surferbroadband
    , contributor
    Comments (4850) | Send Message
    Oh yes!!!! slaughter them all!!!!
    23 Oct 2013, 12:22 PM Reply Like
  • toonies
    , contributor
    Comments (444) | Send Message
    Hold your stocks and minimize possible short ride.
    23 Oct 2013, 11:49 AM Reply Like
  • sprasad03
    , contributor
    Comments (76) | Send Message
    buying call options all over the place
    23 Oct 2013, 12:08 PM Reply Like
  • dannydyn
    , contributor
    Comments (262) | Send Message
    Wish I had more cash to buy here.... :(
    23 Oct 2013, 12:18 PM Reply Like
  • surferbroadband
    , contributor
    Comments (4850) | Send Message
    My mama closed her B of A account a year ago. Best thing she ever did. They tried to short her of $900 when she closed the account.


    Dont' listen to B of A.
    23 Oct 2013, 12:24 PM Reply Like
  • Miro Kefurt
    , contributor
    Comments (835) | Send Message
    Let's see if the rollo-coaster has any oomph left for another up ride or if it will park and let the passengers off.
    After all institutions have another 60 to 72 million shares to dump, but at 10 million per day in trades will anyone notice if they unload the shares on to private investors that were hyped up so well over last few months ?
    I took short ride yesterday and was lucky owner of TSLA for 52 to 56 minutes, a very profitable time, but I would not do that again today, and not likely to do it ever again.
    No one is ALWAYS that lucky.
    23 Oct 2013, 12:31 PM Reply Like
  • Michael Bryant
    , contributor
    Comments (6749) | Send Message
    Down 15% after jumping 620%. Sounds like profit-taking.
    23 Oct 2013, 12:37 PM Reply Like
  • DeliciousWolf
    , contributor
    Comments (71) | Send Message
    I can't believe the number of irrelevant comments attacking BoA, rather than the message! Talk about your pointless ad hominem attacks. Right or wrong, at least BoA is arguing the facts and earnings, which is more than I can say for this lot.
    23 Oct 2013, 01:07 PM Reply Like
  • surferbroadband
    , contributor
    Comments (4850) | Send Message
    B of A has a bad track record and got bailout money. B of A is also short sighted. 1) it probably is shorting TSLA 2) it is not looking at the big picture and seeing that TSLA is about to change the world. Supercharging will fuel sales and Sales will increase demand for supercharging.


    The chicken and egg problem with TSLA is supercharging. People will not buy the car unless supercharging is available. Making supercharging available and free is a no-brainer to buy the car if you have the money.


    When the inexpensive model becomes available, the supercharger network will be completed and thus who would buy anything else?


    Also earning are dependent on sales. To determine Sales, registrations is the number to look at. Look at previous SA articles on TSLA and read comments. The data is out there.
    24 Oct 2013, 02:09 AM Reply Like
  • Merrlin
    , contributor
    Comments (9) | Send Message
    Pigs get slaughtered. Know when to sell.
    23 Oct 2013, 01:10 PM Reply Like
  • jarad.rosenberg@gmail.com
    , contributor
    Comments (11) | Send Message
    BofA is an excellent bank and continues to provide noteworthy pieces. A $45 pt is well thought out and relfective of the value of a company which has every auto manufactuer peering over it's shoulder and a technology that could upend the internal combustion engine as we know it. Write on BofA. Incredibly insightful work.
    23 Oct 2013, 01:22 PM Reply Like
  • surferbroadband
    , contributor
    Comments (4850) | Send Message
    B of A is an awful bank and continues to provide garbage pieces. A $45 pt is not well thought out and reflective of the non value of a company which doesn't have every auto manufacturer peering over it's shoulder and a technology that could upend the internal combustion engine as we know it. Wrong on B of A. Incredibly garbage work.
    24 Oct 2013, 02:00 AM Reply Like
  • Jake B
    , contributor
    Comments (11) | Send Message
    I sold at 181 and of course it went up after that. I felt possibly I made a mistake but you rarely can sell right at the top, at least I can't. Anyway I don't feel stupid now. I think this could be the beginning of the bubble bursting although a good quarterly report could change that. I don't feel like betting on that.


    I love the car, like the company and think Musk is an innovator with vision. I just think the stock became overvalued. I was glad about that since I sold and made quite a bit of money and put that into a company that I think has more upside potential.
    23 Oct 2013, 01:22 PM Reply Like
  • eager1
    , contributor
    Comments (162) | Send Message
    Another thing analysts do not understand is that TSLA is like AMZN. They are going to be pumping all the money they make into expansion for years. AMZN never shows big profits. Analysts hate them and stock buyers love them. Why? Because it is a secular trend that cannot be denied.
    It was interesting to hear Elon tell the German audience that he will be the last person to sell one share of his stock.
    The sell off is long, long overdue. The ride is just beginning. I have never known anyone that knew exactly when to jump off the train and then jump back on.
    23 Oct 2013, 02:58 PM Reply Like
  • jimmyboli
    , contributor
    Comments (12) | Send Message
    AMZN never went parabolic in such a short time
    23 Oct 2013, 08:50 PM Reply Like
  • Manitobatex
    , contributor
    Comments (1204) | Send Message
    B of A or any other bank making predictions are playing the odds and if they are right they have bragging rights as well the likely hood of having your money in their banks and those customers will most assured have smiles on their faces. On the other side if they are wrong they save face saying that TSLA is a culture stock & stock price is a result of the culturists............... can't lose.......but you can if you are shorting........ain't going to continue downward.........stay tuned.........batteries are charging UP.
    24 Oct 2013, 12:07 AM Reply Like
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