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.