Tesla: Take What Elon Musk Says With a Big Grain of Salt, Says Analyst

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Tesla: Take What Elon Musk Says With a Big Grain of Salt, Says Analyst

Tesla: Take What Elon Musk Says With a Big Grain of Salt, Says Analyst


Elon Musk has legions of fans who have been happy to indulge his whims, but the World’s Richest Man also has plenty of detractors. Hardly any have been as outspoken in their distrust of Musk as GLJ Research’s Gordon Johnson.

The analyst has not been shy in laying out the reasons why investors should stay away from Tesla (TSLA) and now Johnson has compiled a list of “Musk promises that weren’t achieved (or, in layman terms, lies).”

These range from broken Twitter pledges (not to ban anti-fascist accounts from the platform, claiming child safety on Twitter was his highest concern even though “images of exploited children can be found all over the app after he gutted the child safety team,”) to his more outré promises such as pledging to donate $6 billion to alleviate world hunger (didn’t happen), land a man on Mars by 2021 (nope), and put 1 million robotaxis on the road in 2020 (uh uh) to the Boring Company bailing out on projects to “Autopilot mistruths” such as his proclamation in January 2017 that it would be 3 to 6 months before Tesla had full autopilot. “Beta was just released this year and has serious problems,” Johnson notes scathingly.

“Why isn’t anyone in the media focused on detailing any of this?” he asks. “Seems like a BIG story, no?”

Johnson thinks the fawning over Musk is a case of not wanting to see reality for what it is, although the analyst notes that might be changing.

“In many ways,” Johnson explains, “it seems E. Musk’s approach is defined by people investing in a dream (and everyone in the media covering each one of these false promises as if they are FACT), a false promise, and he maintains this house of cards quite well, although the massive decline of Tesla stock this year might show that this is coming to an end. It also might explain his erratic behavior.”

It’s hardly surprising to learn, then, that Johnson has a Sell rating for TSLA shares, backed by a $73 price target. The figure implies ~62% downside from current levels. (To watch Johnson’s track record, click here)

Johnson is the Street’s most prominent bear and while 2 others join him in the naysayer group, with the addition of 18 Buys and 8 Holds, the stock claims a Moderate Buy consensus rating. In contrast to Johnson’s take, there’s plenty of upside projected here; at $303.72, the average target suggests shares will climb 64% higher in the year ahead. (See Tesla stock forecast on TipRanks)

To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.

Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.



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