Tesla’s remarkable rally in stock prices can be attributed to Elon Musk‘s heightened role and attention at the electric vehicle (EV) company, according to activist investor Ross Gerber. In an interview with Yahoo Finance on Thursday, Gerber emphasized the significant impact of Musk’s renewed focus on Tesla’s success.
Since Musk’s announcement of a new Twitter CEO, Tesla shares have soared by more than 50%. Gerber highlighted the instrumental role played by Musk in the stock’s dazzling rally over the past month. In a bid to address concerns raised by Gerber and other investors, Musk shifted his focus from Twitter to Tesla, satisfying their expectations.
Tesla’s Rally Driven by Elon Musk’s Leadership, Activist Investor Affirms
Activist investor Ross Gerber commended Tesla CEO Elon Musk for the impressive surge in the company’s stock price. Having briefly pursued a board seat at Tesla and advocating for change in Twitter’s management, Gerber expressed satisfaction with Musk’s return to the helm of the EV manufacturer. Since Musk announced Linda Yaccarino as his replacement on May 12, he has directed his attention back to Tesla, resulting in a breakneck rally for the company’s shares.
Renowned Tesla bull Adam Jonas adjusted his rating for the stock, expressing concerns over the company’s earnings amidst an ongoing price war. In a research note, Jonas warned of a possible downturn in Tesla’s impressive 115% rally since the start of 2023. The Morgan Stanley analyst, who had previously maintained an “overweight” rating for the stock, advised investors to consider taking profits given the rapid surge.
Tesla’s Stock Surge Faces Headwinds, Says Top Bull Analyst Jonas
Jonas highlighted Tesla’s price war and its impact on earnings as a key factor that may hinder the stock’s performance. The analyst cited the first-quarter earnings report, which indicated a 24% decline in profit margins. Jonas anticipates negative revisions to Tesla’s earnings forecasts. Besides, he expects intensifying competition from Chinese EV players to contribute to a trend of pricedowns in the long term.
Following the impressive rally, several analysts, including Morgan Stanley and Barclays, have downgraded their ratings on Tesla. Barclays analyst Dan Levy joined the chorus as well. First, he downgraded the stock from “overweight” to “equal weight.” Then, he even advised investors to consider seizing the opportunity to secure profits from the substantial surge. The market consensus suggests that caution in the market may occur in the face of Tesla’s recent price volatility.