Topline
Shares of Tesla staggered Thursday after the stock received a notable analyst downgrade and smaller electric vehicle competitors reported weaker-than-expected quarterly results, sending the fortune of Tesla’s centibillionaire CEO Elon Musk down significantly.
Tesla CEO Elon Musk speaks with British Prime Minister Rishi Sunak last week.
Key Facts
Tesla stock sank 5.5% to $210 on Thursday, wiping out $39 billion in market capitalization and marking the 11th-largest daily percentage drop of 2023 for the volatile stock.
The slip followed an initiation of coverage of Tesla by HSBC analyst Michael Tyndall at a sell rating, valuing the stock 21% below its current price at $133.
Also sliding were fellow American electric car maker stocks Rivian (shares down 10% on Thursday) and Lucid (down 5%) after the pair each reported earnings which disappointed investors Tuesday, with each company on track to burn through billions of dollars in cash this year.
It was a down day overall for the broader market but less painful than for the EV stocks, with the S&P 500’s 0.8% loss its steepest in two weeks.
Forbes Valuation
Musk, who owns about 13% of Tesla shares, lost $8.7 billion Thursday, a more than $7 billion larger decline than that of any other billionaire, according to Forbes’ calculations. Musk remains the wealthiest person on earth with an estimated net worth of $223.7 billion, though that remains about $100 billion below his peak fortune of $320 billion achieved in November 2021, when Tesla was valued at over $1.2 trillion.
Surprising Fact
Tyndall named Musk as a “risk” for Tesla’s future stock performance, though not because of the oft-criticized antics he’s known for outside of Tesla. Instead, Tyndall said Musk’s “prominence presents a considerable ‘singleman’” risk for Tesla, referring to the long-term challenges faced by companies whose success is inextricably linked to a single leader.
Big Number
20%. That’s how much Tesla shares are down over the last month. Much of the drop came after the company missed analyst forecasts for quarterly profit and sales in its October 18 earnings report. The stock remains up 94% year-to-date.
Further Reading
Source: https://www.forbes.com/sites/dereksaul/2023/11/09/elon-musks-net-worth-falls-9-billion-as-tesla-stock-slides/