Goldman Sachs recently announced their new price target for the self-driving company, Tesla. The financial institution’s new price target was lower than their previous forecasts for the automotive company.
The financial institution’s analysts were all in agreement on the newly lowered price target. The analysts managed to push the already bearish forecast a little bit lower. They are citing that the automaker is going to tap the capital market this year.
The analysts dispelled what Tesla’s CEO Elon Musk said, and have stated that there is a big chance that the will have to tap the capital markets this year. They managed to keep their rating on the stock as a sell, and bringing the six-month price target from $205 to $195.
Goldman’s new price target is a whopping 36% decline from their initial forecasts. The institution’s report came after Tesla’s lackluster performance report last week. The automaker managed to report disappointing figures, raising more production questions.
Tesla’s report last week included a hefty number of delayed production from their first-quarter. The automaker announced that they are still going to push through with their promise of 5,000 Model 3 in production per week.
The automaker assured their investors that they will continue with their promise. They also noted that their investors need not to worry about the possibility of new debt or equity rise this year. This note managed to propel the company’s stock on the same session.
Goldman Analyst Note
According to Goldman Sachs’ analyst, David Tamberrino, “We believe the sustainable production rate for the second quarter of 2018 is most likely below the 2,000 vehicle mark the company achieved in the final week of the [first] quarter,”
Tamberrino said, “We see the company likely sustaining Model 3 production around the 1,400 per week mark.”
He also added that “Although the company stated that is does not require a capital raise this year, we note that this is predicated upon a sustained 5,000 per week production rate achieved exiting the second quarter of 2018,”
Despite the new forecasts, Tesla’s stocks continue to rise in the market today. The company’s performance remains to be positive in their previous note. The company managed to pull a bullish run after the announcement, jumping by 20% since then.
On the bleaker side, Tesla’s overall stock performance this year remains to be lackluster. Their market performance this year is still slumping at a flat 3% decrease. The production failures continue to linger as a pressing matter for the company.
BWorldFinance is your primary source of news in the financial market, technology, and more. Visit bworldfinance.com now and get the latest happenings on the market. Register an account now and begin your investing journey!