Elon Musk needs to assuage investor concerns about his Twitter saga, Wedbush said, as Tesla is going through one of the biggest moments in the company’s history.

  • Wednesday’s Tesla earnings report will be one of the most important moments in its history, Wedbush said.
  • Wedbush says Tesla stock could rise in 2023, but Elon Musk needs to reassure investors about his chaotic takeover of Twitter.
  • His Twitter update has damaged Musk’s image, and the CEO needs to restore confidence.

Elon Musk needs to assuage investor concerns about his wild Twitter saga as Tesla hits its fourth-quarter earnings on Wednesday, in what Wedbush says marks one of the most important moments in the automaker’s history.

“While each quarter is important to Tesla, we would like to highlight this upcoming call and comments as one of the most important moments in Tesla’s history and for Musk himself,” said Wedbush’s Dan Ives, noting that Tesla is facing more high competition and more severe consequences. macroeconomic outlook than ever before. What’s more, Elon Musk is wrestling with his own negative headlines around the Twitter saga that he’ll have to address in order for investors to get comfortable with stocks again.

“Despite all the concerns about Musk’s attention on Twitter, the sale of Tesla shares, [naming] a new CEO and other buzz created by this ongoing soap opera… Elon needs to reassure investors about this tight wire balancing act, reaffirm his goals for the year and lay out his strategic vision despite dismal short-term macro performance,” the note reads. added.

The company’s shares are down 65% in 2022 amid rising inflation, a strong dollar and high interest rates. The sell-off was exacerbated by Elon Musk’s chaotic takeover of Twitter, which sold more than $40 billion of his own Tesla shares.

The move hurt Musk’s personal brand, which in turn hurt Tesla’s brand, analysts said. Some Tesla investors have already urged Musk to step down from Twitter or appoint a new Tesla CEO, showing declining confidence in the tech titan as he remains under scrutiny from the public.

“Essentially, Musk has gone from a red-capped superhero to a villain in the eyes of many investors following the ongoing Twitter debacle,” Ives said.

The Wedbush note added that Musk’s easing of investor concerns could be a bullish factor in tomorrow’s call. The stock could also benefit if Tesla decides how recent price cuts in the US, Europe and China will affect its earnings, and if Musk changes Tesla’s 50% growth target this year to a more realistic 35-40%, Wedbush said.

Wedbush analysts estimate that Tesla shares will rise 20% by the end of the year to $175. Shares have already rebounded from 2022 lows, up 32% year-to-date.

Other commentators remain optimistic about Tesla despite its dismal 2022 results. Canaccord Genuity senior analyst George Gianarikas urged investors to buy Tesla shares ahead of tomorrow’s earnings report as many of the hurdles the electric car maker faces are already priced in.

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