Investor's Corner
Tesla stock (TSLA) one week after the Q1 2016 Report
Post Q1 Report Action
The technical response of the stock market to last week’s Tesla Q1 2016 report has been mostly negative. The stock lost quite a bit since last week, standing at around $208 when I write this, but overall 12-month Analyst Price Targets have actually increased with the average raising from $253 to $277, indicating that the Top Analysts did not see the report as negatively as this past week’s market action.
This is a small sample of the reactions from Top Analysts, noting that none of them changed their position to BUY, SELL or HOLD.
Adam Jonas of Morgan Stanley, reiterated a BUY with $333 price target, commenting that “we forecast ~70k units in 2016 (vs. the reiterated guidance of 80-90k shipments), which is composed of ~16k Model X and ~54k Model S units. In 2Q, we forecast ~17k deliveries–inline with the outlook.”
Charlie Anderson of Dougherty resumed coverage of TSLA with a BUY and price target of $500, noting that “the focus coming out of the Q1 report is on managements decision to pull-forward its production goal of 500K vehicles from 2020 to 2018. While this aggressive schedule certainly increases the risk of nearer-term stumbles, it also significantly pulls forward the earnings power. Tesla has set a goal to produce 1MM vehicles by 2020, roughly 2x what most observers previously believed. Our view is that demand is not the question; it is solving the manufacturing challenges deftly as they come.”
Brian Johnson of Barclays reiterated a SELL with $165 price target.
Ryan Brinkman of J.P. Morgan reiterated a SELL with $185 price target, as he “Doubts Tesla Motors Can Meet Accelerated Production Target.”
Colin Rusch or Oppenheimer reiterated a BUY with $385 price target, indicating that “we believe the critical characteristic of TSLAs business model over the next 24 months will be operating leverage. We believe the company can achieve 15%+ incremental operating margins as it ramps the Model 3. We modeling TSLA reaching 500k vehicles in 2019 vs. the target of 2018, noting the company has a history of setting nearly unachievable goals. Effectively we are accelerating ramp by a year from our previous expectations, but calculate that if the company reaches its 500k vehicle target in 2018 and 1M in 2020, our EPS estimates will prove ~30% too low.”
See the table below from TipRanks (tipranks.com) for a complete summary of the current top analyst ratings.
![TSLA analyst coverage [Source: TipRanks]](http://www.teslarati.com/wp-content/uploads/2016/05/TipRanks-1.png "TSLA analyst coverage [Source: TipRanks]")
TSLA analyst coverage [Source: TipRanks]
Swing Trading TSLA using the MACD
This is the first post where I will start outlining techniques that traders may want to use when trading TSLA stock.
I am mostly a “swing trader”. Swing Trading is a short term trading method that can be used when trading stocks and options. Whereas Day Trading positions last less than one day, Swing Trading positions typically last two to six days, but may last as long as two weeks (for TSLA sometime six-seven weeks). Swing traders use technical analysis to look for stocks with short-term price momentum. These traders aren’t interested in the fundamental or intrinsic value of stocks, but rather in their price trends and patterns.
There are a number of technical indicators that swing traders use. Today I will cover the MACD. The Moving Average Convergence Divergence (MACD) is a trend-following momentum indicator that shows the relationship between two moving averages of prices. The MACD is calculated by subtracting the 26-day exponential moving average (EMA) from the 12-day EMA. The Exponential Moving Average (EMA) is a type of moving average that is similar to a simple moving average, except that more weight is given to the latest data.
The good thing is that you really do not have to calculate any of these indicators yourself, as pretty much all trading platforms that I know of provide you with such indicators as an option when displaying the stock chart of a given security.
The following stock chart from Wall Street I/O shows the TSLA market data as “candlestick” (showing open, close, high and low of the day) for the past year, plus it also shows the MACD for the same period.
Source: Wall Street I/O
One technique that swing traders use is to enter a “long” trade when the MACD “crosses to the bulls”, and exit the trade when the MACD “crosses to the bears”. I have indicated these points in the chart for the huge run up between the February low and April high.
Micah Lamar is the CEO of Wall Street I/O (wallst.io), where together with his team of experts he helps people learn stock and option trading. Disclosure: I have been a subscriber to wallst.io for a few years.
This past weekend, Micah run a “MACD Validation” experiment on TSLA 1-year behavior up to last Friday close. The results are as follows.
Micah found that “if one had bought TSLA stock exactly a year ago, and held it for the full year, one would have incurred a $30 loss per share.
If one had bought and held TSLA stock while the MACD was bullish, one would be up $22 for the year.
If one had sold (short) TSLA stock while the MACD was bearish, one would be up $51 for the year.”
Someone trading both sides (long and short the stock) would be up a whopping $73, or a $30% gain.
Of course, trading the same entry and exit points based on the MACD with put or call options instead of stock would have resulted in returns 10 to 100 times or better than if just trading TSLA stock.
Micah indicates that “TSLA is a great stock for swing traders: the reason is that it has so much “beta.” A high beta indicates that a security is much more “volatile” than the rest of the market. Most high-tech stocks like TSLA have a beta of greater than 1, offering the possibility of a higher rate of return, but also posing more risk.
As far as where TSLA is today, it is still in “bearish” territory (as far as the MACD and other indicators are concerned), which for me it means that it is untouchable on long trades as “too risky”, and since I do not like to play on the downside for stocks of companies that are in my “buy what you know” list, I will not trade it again until the MACD crosses back to the bulls.
Shark Tank personality and legendary investor Kevin O’Leary roasted former Vice Presidential nominee Tim Walz over his comments regarding Tesla shares earlier this week.
Walz, a Minnesota Democrat, said that he recently added Tesla (NASDAQ: TSLA) to his Apple Stocks app so he could watch shares fall as they have encountered plenty of resistance in 2025 so far. He said that anytime he needs a boost, he looks at Tesla shares, which are down 36 percent so far this year:
If you need a little boost during the day, check out Tesla stock 📉 pic.twitter.com/KBEh6pOZLW
— Tim Walz (@Tim_Walz) March 19, 2025
Walz, among many others, has been critical of Tesla and Elon Musk, especially as the CEO has helped eliminate excess government spending through the Department of Government Efficiency (DOGE).
However, Kevin O’Leary, a legendary investor, showed up on CNN after Walz’s comments to give him a bit of a reality check. O’Leary essentially called Walz out of touch for what he said about Tesla shares, especially considering Tesla made up a good portion of the Minnesota Retirement Fund.
As of June 2024, the pension fund held 1.6 million shares of Tesla stock worth over $319.6 million:
O’Leary continued to slam Walz for his comments:
“That poor guy didn’t check his portfolio and his own pension plan for the state. It’s beyond stupid what he did. What’s the matter with that guy? He doesn’t check the well-being of his own constituents.”
He even called Walz “a bozo” for what he said.
Of course, Walz’s comments are expected considering Musk’s support for the Trump Administration, as the Tesla CEO was a major contributor to the 45th President’s campaign for his second term.
However, it seems extremely out of touch that Walz made these comments without realizing the drop was potentially hurting his fund. While we don’t know if the fund has sold its entire Tesla holdings since June, as a newer, more recent report has not been released yet, it seems unlikely the automaker’s shares are not still making up some portion of the fund.
Tesla (NASDAQ: TSLA) received an upgraded rating on its shares from Wall Street firm Cantor Fitzgerald, who recently took a trip to Austin to visit the company’s data centers and production lines ahead of several high-profile product launches set for this year.
It was a bold move, especially considering Tesla shares are under immense pressure currently, fending off negative news regarding the company’s sentiment and potentially lower-than-expected delivery figures due to the launch of a new version of its most popular vehicle, the Model Y.
However, the bulls on Wall Street are still considering Tesla to be a safe play, especially considering its robust presence in various industries, including automotive, energy, and AI/Robotics.
Cantor Fitzgerald analyst Andres Sheppard said in a note that, during a recent visit to Tesla’s Cortex AI data centers and the production line at Gigafactory Texas, it was clear there is a lot of potential and runway for Tesla in 2025:
“On 3/18, we visited Tesla’s Cortex AI data centers and the factory’s production lines ahead of the company’s introduction of its Robotaxi segment (targeted for June in Austin, followed by CA later in 2025). With Tesla’s shares now down ~45% YRD, we upgrade Tesla to Overweight (from Neutral) ahead of upcoming material catalysts. Our $425 12-month PT is unchanged. Our Thoughts: Attractive Entry Point Ahead of Material Catalysts.”
Sheppard went on to mention the catalysts, which he believes are the Robotaxi rollout in Austin in June, along with the continued rollout of Full Self-Driving in China, the eventual rollout of FSD in Europe, and the introduction of the affordable models in the first half of this year, and those were just on the automotive side.
There are several others, including Optimus, growth in the energy division, and in the longer term, the Semi.
In terms of potential weaknesses, Sheppard expects the likely removal of the EV tax credit and some of its growth to be offset by tariffs as the two big things that stand in the way of even more growth for the company.
Tesla is up over 5 percent on Wednesday, trading at $236.86.
Tesla stock (NASDAQ: TSLA) surged over 7 percent on Wednesday, canceling out some of the losses it has felt this week.
It has been a less-than-ideal start for Tesla in 2025, as the company has wiped out all of its gains felt from the victorious election campaign of President Donald Trump. The stock is down 34 percent so far this year.
The losses have mostly been felt due to reports of decreased demand due to pushback against CEO Elon Musk and his support of President Trump, as well as investor concern over the CEO’s personal use of time between the Department of Government Efficiency (DOGE) and Tesla itself.
In a note this week from Wedbush, analyst Dan Ives wrote:
“Musk needs to step up as Tesla CEO at this critical juncture. In a nutshell, the word ‘balance’ has been missing with Elon Musk and his ability to run Tesla as CEO….while instead focusing all of his energy and time driving his DOGE initiative within the Trump Administration. Since Trump’s White House 2nd term kicked off in January, we have seen Musk and Trump connected at the hip with Musk essentially living at the White House and Mar-a-Lago in Palm Beach. There has been little to no sign of Musk at any Tesla factory or manufacturing facility the last two months and perception has become reality for Tesla shares. Trump getting elected President was a huge moment for Musk and Tesla in our view as this will create the fast track for an autonomous federal roadmap…however the DOGE efforts have now intertwined Tesla into this brewing political firestorm.”
Wednesday’s slight bump for Tesla shares is likely related to the support the company received from President Trump yesterday, who purchased a Model S sedan at the White House and pledged to pay for it with a check.
President Donald Trump buys a Tesla at the White House – Here’s which model he chose
The move was one that signaled a buying spree from high-profile Republicans, including Sean Hannity, among others, who announced their support for Musk and Tesla:
As promised yesterday, I Just ordered my new self driving Tesla! Over 1000HP, 0-60 in 2.0 seconds!
Details on how to win the Tesla of your Choice soon on https://t.co/9hkyEX1UVi! pic.twitter.com/PSCCtUsXK2
— Sean Hannity 🇺🇸 (@seanhannity) March 11, 2025
Tesla shares closed at $248.09 on Wednesday, up 7.59%.
U.S. Secret Service in talks for armored cars with this automaker
Tesla Powerwalls to help expand Virtual Power Plant in Colorado
Tesla quietly added this extra Sentry Mode feature to deter vandals
-
Elon Musk7 days agoElon Musk roasts owners of this car brand after another Tesla vandalism incident
-
Elon Musk2 weeks agoPresident Donald Trump buys a Tesla at the White House – Here’s which model he chose
-
News1 week agoU.S. AG Pam Bondi: Tesla Molotov attack suspect facing up to 20 years in prison
-
News1 week agoRivian supports Tesla despite all the Elon Musk hate
-
News5 days agoSpaceX rescue mission for stranded ISS astronauts nears end — Here’s when they’ll return home
-
Elon Musk1 week agoTesla says it will be a victim of Trump admin’s tariff strategy
-
News5 days agoTesla reveals Cybercab battery pack and range efficiency
-
Tesla1 week agoTesla’s price target gets cut by Wells Fargo analyst: Barron’s