Tesla stock plummets another 5%, capping a difficult week for investors

The pain for Tesla investors never ends as a tough week comes to an end.

Tesla shares slipped another 4% today, hitting a multi-year low and sending the stock down nearly 16% for the week as of midday trading.

Tesla investors blame CEO Elon Musk for the stock’s near-term weakness, with Twitter being the main source of criticism. Long-term shareholders see him as distracted by Tesla’s leadership and leave the company in a critical phase and put downward pressure on the stock with the recent share sales.

Gary Black, a prominent long-term Tesla shareholder, believes today’s weakness could be due to more selling:

If true, it comes after a filing this week in which Musk announced he sold 22 million Tesla shares Monday through Wednesday. The sale was valued at approximately $3.6 billion.

That prompted the Wall Street analyst community to weigh the moves, which come at an awkward time for Tesla shareholders.

“The Twitter nightmare continues as Musk uses Tesla as his own ATM to further fund the red ink at Twitter, which is getting worse by the day as more advertisers are controversially fleeing the platform [increasingly] powered by Musk,” Wedbush’s Dan Ives wrote in a note yesterday. “In late April, Musk said he was done selling Tesla stock, instead the exact opposite has happened, putting massive pressure on Tesla stock, which has significantly underperformed the market since Musk acquired Twitter in late October .”

Goldman’s Mark Delaney echoed a sentiment loudly voiced by Tesla investors this week — Musk needs to return to Tesla and focus the company on the task at hand and continue the global replacement of traditional gas-powered vehicles with electric vehicles.

Tesla needs to shift the company’s consumer focus back to its “core attributes of sustainability and technology,” Delaney said, in order to exceed his long-term expectations for Tesla.

Despite the near-term negative sentiment toward Tesla in the analyst community, one analyst sees Tesla as a buying opportunity.

“At current prices, we view Tesla shares as undervalued and trade in the 4-star range,” Morningstar analyst Seth Goldstein wrote in a statement yesterday.

Despite the economic headwinds Tesla is facing in China and the EU, Goldstein believes the IRA’s federal subsidies for electric vehicles will “benefit” Tesla in the US starting next year. “Given [the IRA effect] and the company’s relatively low volume of 1.2 million shipments on a trailing 12 month basis, there should continue to be strong demand even in an economic slowdown. We continue to expect Tesla to deliver nearly 1.4 million and 2.1 million vehicles in 2022 and 2023, respectively.”

Pras Subramanian is a reporter for Yahoo Finance. you can follow him Twitter and further Instagram.

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