Proactiveinvestors USA & Canada Tesla Inc https://ca.proactiveinvestors.com Proactiveinvestors USA & Canada Tesla Inc RSS feed en Sat, 15 Dec 2018 00:28:17 -0500 http://blogs.law.harvard.edu/tech/rss Genera CMS action@proactiveinvestors.com (Proactiveinvestors) action@proactiveinvestors.com (Proactiveinvestors) <![CDATA[News - Tesla gets a big price target boost to $465 from Baird ]]> https://ca.proactiveinvestors.com/companies/news/211166/tesla-gets-a-big-price-target-boost-to-465-from-baird-211166.html Analysts at Baird reiterated their Outperform rating on Tesla Inc (NASDAQ:TSLA) Thursday and raised their price target by 13% to $465 from their previous target of $411.

“We think Tesla’s transition to becoming sustainably profitable will transform the narrative around the company and should coincide with positive catalysts (including new product introductions/production, international Model 3 deliveries, China factory, etc.) which should drive shares higher,” wrote Baird analysts Ben Kallo and David Katter.  

“We think Tesla may be in the first positive estimate revision cycle in 3-4 years, and believe estimate revisions, upcoming catalysts, and improving sentiment driven by a shifting narrative could drive shares higher,” she added.

The analysts alluded to several catalysts in the shape of the start of “European deliveries, initial production in China, introduction/production of new products, and inclusion in the S&P 500.”

Tesla’s long-awaited mass-market Model 3 electric car is set to hit European roads in February next year.

READ: Short-seller Andrew Left 'believes' in Elon Musk and touts conversion to Tesla

Customers who put a deposit down way back in March 2016 will be among the first to take delivery of the cars as long as they confirm their order by January 1.

The first Model 3 rolled off the assembly line in the US last July and delivered to Tesla’s billionaire boss Elon Musk.

The Model 3, which currently starts at around US$50,000 (£39,000), has been the best-selling car by revenue in the US over the past few months, with sales averaging almost US$1bn a month.

As production ramps up and becomes more efficient, Musk wants to build a basic model that would retail at US$35,000.

The analysts at Baird said Tesla management does not believe it needs to return to capital markets, but "we think a capital raise would be positive."

“We think a capital raise would remove lingering liquidity concerns and could be prudent to strengthen the balance sheet and insulate against risks of a broader global slowdown,” wrote the analysts.

While touching on Tesla’s outlook the analysts said they believed the Tesla narrative is starting to change from “Tesla is on the verge of bankruptcy” to “Tesla can make money,” and they believed improving sentiment will drive share appreciation.

 

Contact Uttara Choudhury at uttara@proactiveinvestors.com

Follow her on Twitter: @UttaraProactive 

 

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Thu, 13 Dec 2018 09:23:00 -0500 https://ca.proactiveinvestors.com/companies/news/211166/tesla-gets-a-big-price-target-boost-to-465-from-baird-211166.html
<![CDATA[News - Tesla cuts solar power prices to spur use of sustainable energy, says CNBC ]]> https://ca.proactiveinvestors.com/companies/news/209392/tesla-cuts-solar-power-prices-to-spur-use-of-sustainable-energy-says-cnbc-209392.html Tesla Inc (NASDAQ:TSLA) is reducing the prices of its solar power systems so it can be affordable and encourage the use of sustainable energy, a report by CNBC said.

The change in prices would allow the average customer of Tesla to get savings of between $3,000 and $4,000, the report quoted a Tesla spokesperson as saying.

READ: Tesla announces new lower-cost Model 3; 4Q vehicle deliveries seen very strong, says Morgan Stanley

"This change, along with our push to continue shortening the time between sale to installation, will accelerate the adoption of solar and the world's transition to sustainable energy," the official said.

A report by Reuters on Thursday quoted Tesla's senior vice president of energy operations, Sanjay Shah, as saying that the price cuts should make the company "highly competitive."

Shah added that the business wanted to become the lowest-cost solar provider in the US. Tesla deployed 93 megawatts of solar energy generation systems in the third quarter of 2018.

Tesla is the world's premier electric vehicle maker.

Contact Rene Pastor by rene.pastor@proactiveinvestors.com

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Fri, 16 Nov 2018 10:07:00 -0500 https://ca.proactiveinvestors.com/companies/news/209392/tesla-cuts-solar-power-prices-to-spur-use-of-sustainable-energy-says-cnbc-209392.html
<![CDATA[News - Tesla taps Robyn Denholm of Australia's Telstra to replace Elon Musk as chair ]]> https://ca.proactiveinvestors.com/companies/news/208847/tesla-taps-robyn-denholm-of-australia-s-telstra-to-replace-elon-musk-as-chair-208847.html Tesla Inc’s (NASDAQ:TSLA) board of directors has announced the appointment of Robyn Denholm as the new chair of the company to replace Elon Musk, who remains as Tesla's CEO, according to a filing wih the Securities and Exchange Commission.

Denholm is the CFO and head of strategy at Telstra, Australia’s largest telecommunications company, and will join Tesla once her six-month notice period with Telstra is complete. She will be the full-time chair of Tesla.

“I believe in this company, I believe in its mission and I look forward to helping Elon (Musk) and the Tesla team achieve sustainable profitability and drive long-term shareholder value,” Denholm said.

“Robyn has extensive experience in both the tech and auto industries, and she has made significant contributions as a Tesla Board member over the past four years in helping us become a profitable company,” said Musk. “I look forward to working even more closely with Robyn as we continue accelerating the advent of sustainable energy.”

READ: US judge approves Elon Musk's settlement with SEC over his Tesla go-private tweet

Musk left the position of chair as part of a plea deal with the SEC to settle a lawsuit filed by the government over his go-private plan that he announced in a tweet in early August. Musk said he will take the electric carmaker private and that funding had been "secured."

The plan was later abandoned, and Musk was accused of misleading investors, prompting the lawsuit by the SEC.

"To ensure a smooth transition during the remainder of Robyn’s time at Telstra, Elon will be a resource to Robyn and provide any support that she requests in her role as chair," the filing by the company said.

Denholm served on the Tesla board as an independent director since 2014.

Her global experience in both Australia and Silicon Valley encompasses leadership roles across a range of technology companies, including Telstra, Juniper Networks, and Sun Microsystems. She is widely credited with leading a team that drove significant increases in Juniper’s revenues, overseeing Juniper’s corporate transformation during her nine-year tenure as Chief Financial and Operations Officer, the filing said.

Her experience also includes numerous finance management roles in the automotive industry while at Toyota, it added.

Reporting by Rene Pastor, contactable on rene.pastor@proactiveinvestors.com

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Thu, 08 Nov 2018 08:17:00 -0500 https://ca.proactiveinvestors.com/companies/news/208847/tesla-taps-robyn-denholm-of-australia-s-telstra-to-replace-elon-musk-as-chair-208847.html
<![CDATA[News - Baird reiterates Outperform rating on Tesla despite WSJ report on FBI probing Model 3 productions numbers ]]> https://ca.proactiveinvestors.com/companies/news/208048/baird-reiterates-outperform-rating-on-tesla-despite-wsj-report-on-fbi-probing-model-3-productions-numbers-208048.html Baird reiterated its Outperform rating on Tesla Inc (NASDAQ:TSLA) Monday despite a report by the Wall Street Journal saying the US Federal Bureau of Investigations was reviewing the company's Model 3 production numbers as part of a criminal probe.

“Shares were briefly under pressure on Friday following a WSJ report Tesla is facing a criminal investigation regarding Model 3 production targets. The article largely recycled previously reported information, in our opinion, and we find certain aspects of the report to be somewhat suspect,” wrote Baird analysts Ben Kallo and David Katter in a note to clients.

“We think it will be extremely difficult for any investigation to find criminal wrongdoing, as evidenced by the recent dismissal of a shareholder lawsuit in the US District Court of Northern California. We would be buyers on any weakness,” they added.

In August, the US District Court of Northern California dismissed a shareholder lawsuit regarding Tesla’s forecasts. Judge Charles Breyer indicated Tesla made meaningful qualifications to projections, and wrote “securities laws do not punish companies for failing to achieve their targets.” Plaintiffs subsequently refiled the lawsuit.

The Baird analysts were of the view that investigators would need to find evidence Tesla made projections it knew would be impossible to achieve, which is “a high bar to meet.”

READ: FBI looking into Tesla’s Model 3 productions numbers, says WSJ

“Separately, the US Air Force’s ongoing dealings with SpaceX could imply any criminal probe facing Tesla CEO Elon Musk is not considered serious,” wrote the analysts.

“The Air Force continues to work with SpaceX, including a $130million contract announced earlier this summer. We view this positively, as Musk and the company presumably faced a substantial evaluation/investigation before receiving the military contract,” they added.

Tesla released a statement in response, confirming that it received a voluntary request for documents about its public guidance for the Model 3 and had cooperated.

The company said it has not received a subpoena, a request for testimony or additional documents, or any other formal process from the Department of Justice.

Shares of Tesla were unfazed, up more than 2.75% to $340 in Monday morning trade, before droppig back to $334.25.

Contact Uttara Choudhury at uttara@proactiveinvestors.com

Follow her on Twitter: @UttaraProactive 

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Mon, 29 Oct 2018 11:42:00 -0400 https://ca.proactiveinvestors.com/companies/news/208048/baird-reiterates-outperform-rating-on-tesla-despite-wsj-report-on-fbi-probing-model-3-productions-numbers-208048.html
<![CDATA[News - FBI looking into Tesla’s Model 3 productions numbers, says WSJ ]]> https://ca.proactiveinvestors.com/companies/news/207969/fbi-looking-into-teslas-model-3-productions-numbers-says-wsj-207969.html The US Federal Bureau of Investigations is taking a look into Tesla Inc’s (NASDAQ:TSLA) Model 3 production numbers, according to a Wall Street Journal report published Friday.

Federal agents are allegedly reviewing Model 3 production numbers dating back to early 2017 as part of a criminal investigation, as per the report.

READ: Tesla beats the Street and delivers; posts profit and ramps up Model 3 production

Tesla released a statement in response, confirming that it received a voluntary request for documents about its public guidance for the Model 3 and had cooperated.

“Tesla's philosophy has always been to set truthful targets – not sandbagged targets that we would definitely exceed and not unrealistic targets that we could never meet. While Tesla gets criticized when it is delayed in reaching a goal, it should not be forgotten that Tesla has achieved many goals that were doubted by most,” stated Tesla.

The company said it has not received a subpoena, a request for testimony or additional documents, or any other formal process from the Department of Justice.

Shares of Tesla were unfazed, up more than 4% to US$327.61 in Friday afternoon trading.

 

Contact Lenore Fedow at lenore@proactiveinvestors.com

Follow her on Twitter: @LenoreMariee

 

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Fri, 26 Oct 2018 14:31:00 -0400 https://ca.proactiveinvestors.com/companies/news/207969/fbi-looking-into-teslas-model-3-productions-numbers-says-wsj-207969.html
<![CDATA[News - Tesla beats the Street and delivers; posts profit and ramps up Model 3 production ]]> https://ca.proactiveinvestors.com/companies/news/207794/tesla-beats-the-street-and-delivers-posts-profit-and-ramps-up-model-3-production-207794.html Tesla (NASDAQ:TSLA) beat the street on Wednesday and delivered third-quarter earnings that drove a profit as it said it ramped up production of its Model 3. 

The new results helped give embattled CEO Elon Musk credibility and sent the company’s share price higher in extended trading.

Tesla announced a net profit of $312 million, its largest ever. The company's stock shot up around 10% during after-hours trading and held steady to hit $319.00 before Thursday’s opening bell.

Free cash flow of $881 million was helped by a surge of new production of the Model 3. 

That money “should help bolster the balance sheet and mitigate concerns over cash burn,” wrote Baird analyst Ben Kallo in a note to investors.

Tesla’s gross margin of 20% for its Model 3s also exceeded Kallo’s expectations and the analyst remains bullish on the electric car maker after its “blow-out” quarter.

“Management indicated it believes Tesla can be sustainably profitable and cash flow positive moving forward, which we think could help flip the narrative,” Kallo wrote.

“We expect share to trade higher following the blow-out quarter and remain buyers,” he added.

While still below the production target it set for June of 5,000 Model 3s per week, the roughly 4,300 Model 3s the company is now averaging per week boosted results.

Baird bullish post earnings

Tesla’s plans to begin portions of Model 3 production in China next year and its introduction of the Model 3 in Europe, which is expected early next year, should also pump up interest in its cars.

 The Palo Alto, California, automaker reported net income of $312 million in the third quarter, a year after reporting a net loss of $619 million.

READ: Short-seller Andrew Left stands by his newly revealed Tesla long: exclusive interview

"Q3 2018 was a truly historic quarter for Tesla. Model 3 was the best-selling car in the US in terms of revenue and the 5th best-selling car in terms of volume," CEO Elon Musk said in a letter to investors.

Keeping a $411 price target and an Outperform rating on the stock, Kallo argues that the narrative around Tesla is changing as it transitions to becoming sustainably profitable.

“Positive estimate revisions could be on the horizon,” Kallo argues.

Adjusted net income was $2.90 a share. The earnings exceeded Wall Street's expectations for a loss of $0.19 per share.

Earlier this week, short-seller Andrew Left moved long on the electric-car maker’s stock ahead of its quarterly results. 

"Citron is long Tesla as the Model 3 is a proven hit and many of the TSLA warning signs have proven not to be significant,” wrote analysts from Citron Research, which Left founded.

“What has changed?? Plain and simple—Tesla is destroying the competition,” they added.

 

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Thu, 25 Oct 2018 08:50:00 -0400 https://ca.proactiveinvestors.com/companies/news/207794/tesla-beats-the-street-and-delivers-posts-profit-and-ramps-up-model-3-production-207794.html
<![CDATA[News - Short-seller Andrew Left stands by his newly revealed Tesla long: exclusive interview ]]> https://ca.proactiveinvestors.com/companies/news/207691/short-seller-andrew-left-stands-by-his-newly-revealed-tesla-long-exclusive-interview-207691.html Shares of Tesla Inc (NASDAQ:TSLA) are bucking the market's downward trend today and popping after short-seller Andrew Left moved long on the electric-car maker’s stock ahead of its quarterly results Wednesday.

"Citron is long Tesla as the Model 3 is a proven hit and many of the TSLA warning signs have proven not to be significant,” wrote analysts from Citron Research, which Left founded.

“What has changed?? Plain and simple—Tesla is destroying the competition,” they added.

In response to Left’s bullish position, investors sent Tesla shares up 12.7% to $294.14 by the close on Tuesday.

In an exclusive interview with Proactive Investors on Tuesday, Left said he stood by his comments. 

"Going into the quarter, with Musk moving up on earnings and short interest, being where it is created an asymmetrical risk/reward as the company seems to be firing on all cylinders." 

READ: Tesla chief Elon Musk faces lawsuit from short-seller Andrew Left of Citron Research

While the media has focused on CEO Elon Musk’s eccentric and outlandish behavior, it has failed to notice the legitimate disruption of the auto industry that is currently being dominated by Tesla, according to Left.

Tesla’s Model 3 is dominating its class when compared against other mid-sized luxury cars and the Model S is outselling Lexus LS, BMW7 Series cars and Mercedes S-Class vehicles in the large luxury car market, according to Citron.

“Lastly, and this now seems obvious, but Tesla appears to be the only company that can actually produce and sell electric cars,” wrote Left and his team at Citron. “[We’re] seeing that demand is new this year and pulling directly from [Tesla’s} competitors.”

Lawsuit stays on track

Left confirmed in the report that he is still suing Tesla and its CEO Elon Musk for alleged violations of US securities law.

“Yes, we are still suing Musk and Tesla and this recent report has no bearing on the current lawsuit,” according to the Citron report.

The lawsuit from Left charges that Musk manipulated the price of Tesla shares by writing false tweets in a bid to “burn” the company’s short-sellers.

The suit zeroes in on Musk’s tweet from August 7, 2018, in which he said he was considering taking Tesla private and had secured funding for the endeavor.

Am considering taking Tesla private at $420. Funding secured.

— Elon Musk (@elonmusk) August 7, 2018

Left claims that a number of short-sellers were forced to cover their positions in the wake of Musk’s tweets about taking Tesla private at US$420 per share, which pushed up the electric-car maker’s share price.

Baird bullish ahead of earnings

In a separate note out today, Baird analyst Ben Kallo argues that if Tesla reports positive cash flow tomorrow, that would be sufficient to drive its shares higher. “The focus will primarily be on cash generation, in our opinion, given concerns over upcoming capital needs,” Kallo wrote.

Kallo projects that Tesla’s management may also provide additional details on the car maker’s potential to increase production over the next year, which would also be looked at favorably by investors. “We think Tesla could provide an update on the Model 3 production ramp, including a pathway to squeeze out more production over the next year,” Kallo said.

The announcement about a new chairman to replace Musk who must forfeit the position for a period of three years as part of the recent SEC settlement, and the appointment of two new independent directors, is the “next focus” for Tesla as well.

Keeping an Outperform rating and a $411 price target on the stock, Kallo concludes that the narrative around the stock could change as the “company achieves positive earnings and cash flow on a sustainable basis.”

“While some think it will take several quarters of execution to transform the narrative, we believe a strong Q3 and favorable outlook on the conference call should be sufficient to drive shares higher,” Kallo concludes.

Contact Ellen Kelleher at ellen@proactiveinvestors.com

-- Katie Lewis in Vancouver contributed to this report --

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Tue, 23 Oct 2018 10:48:00 -0400 https://ca.proactiveinvestors.com/companies/news/207691/short-seller-andrew-left-stands-by-his-newly-revealed-tesla-long-exclusive-interview-207691.html
<![CDATA[News - Tesla removes self-driving option from most of its vehicles, saying it causes too much confusion ]]> https://ca.proactiveinvestors.com/companies/news/207498/tesla-removes-self-driving-option-from-most-of-its-vehicles-saying-it-causes-too-much-confusion-207498.html Tesla Inc (NASDAQ:TSLA) said it has removed the option for customers to buy its ‘Full Self-Driving Capability’ package from the online design studios of its vehicles, a report by Elektrek said.

At the time it was introduced with the Autopilot 2.0 hardware in 2016, Tesla said that it would release self-driving capability through over-the-air updates after validating the software and having regulatory approval. The report said that two years later it has yet to happen, but Tesla has always claimed that it is still in the works.

CEO Elon Musk said that the ‘Full Self-Driving Capability’ package was creating too much “confusion.”

Also available off menu for a week. Was causing too much confusion.

— Elon Musk (@elonmusk) October 18, 2018

The automaker has removed the option, which has cost between $3,000 and $5,000, on the online design studios of all its vehicles.

Only the $5,000 Enhanced Autopilot package is now officially available to order the option.

READ: Tesla announces new lower-cost Model 3; 4Q vehicle deliveries seen very strong says Morgan Stanley

Tesla insists that it is still working to make the feature available as originally planned and buyers can still order it as an “off the menu item” for the next week, but after that, they are unlikely to make the option available to purchase until they actually start rolling out the feature.

Tesla is the world's top electric-vehicle manufacturer.

Reporting by Rene Pastor, contactable on rene.pastor@proactiveinvestors.com

 

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Fri, 19 Oct 2018 11:00:00 -0400 https://ca.proactiveinvestors.com/companies/news/207498/tesla-removes-self-driving-option-from-most-of-its-vehicles-saying-it-causes-too-much-confusion-207498.html
<![CDATA[News - Tesla announces new lower-cost Model 3; 4Q vehicle deliveries seen very strong says Morgan Stanley ]]> https://ca.proactiveinvestors.com/companies/news/207478/tesla-announces-new-lower-cost-model-3-4q-vehicle-deliveries-seen-very-strong-says-morgan-stanley-207478.html Tesla Inc (NASDAQ:TSLA) CEO Elon Musk announced the release of a lower cost Model 3 while an investment bank said fourth quarter deliveries will probably run at a strong clip.

Musk said the company will begin selling the mid-range version of the Tesla Model 3 at a price of $45,000, before savings knock it down to about $31,000, the company claimed. 

Costs $35k after federal & state tax rebates in California, but true cost of ownership is closer to $31k after gas savings

— Elon Musk (@elonmusk) October 18, 2018

Tesla has the potential to issue an "extremely strong" guidance for vehicle deliveries in the fourth quarter of the year, a report by investment bank Morgan Stanley (NYSE:MS) said.

Morgan Stanley analyst Adam Jonas forecast in a research note to clients a 20% sequential improvement in Model 3 deliveries and sees them being heavily weighted to top-of-the-line mix.

Given his understanding that the vast majority of Model 3 production is dual-motor, Jonas added that he would not be surprised to see average transaction prices for the Model 3 to approach $60,000 per unit or more.

READ: Tesla starts off 4Q with strong production numbers; Musk tweets about climate change

Given his thinking that the company's working capital terms could drive a cash flow surprise, Jonas said he sees conditions supporting Tesla offering "extremely strong" guidance for 4Q profit and cash flow. 

He also believes Tesla will use the momentum to potentially tap the equity market and continues to forecast a $2.5 billion equity capital raise in 4Q. Jonas kept an Equal Weight rating on Tesla shares with a $291 price target.

Tesla shares rose 1.17% in Friday's premarket to $267, having closed on Thursday 2.9% lower at $263.91.

Reporting by Rene Pastor, contactable on rene.pastor@proactiveinvestors.com 

 

 

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Fri, 19 Oct 2018 08:55:00 -0400 https://ca.proactiveinvestors.com/companies/news/207478/tesla-announces-new-lower-cost-model-3-4q-vehicle-deliveries-seen-very-strong-says-morgan-stanley-207478.html
<![CDATA[News - Elon Musk is set to buy $20 million worth of Tesla stock ]]> https://ca.proactiveinvestors.com/companies/news/207297/elon-musk-is-set-to-buy-20-million-worth-of-tesla-stock-207297.html Tesla Inc (NASDAQ:TSLA) CEO Elon Musk intends to purchase $20 million worth of stock from the electric-car maker during the next open trading window in the wake of Tesla’s and Musk’s settlement with the Securities and Exchange Commission, according to an 8K regulatory filing.

“Separate and apart from the settlement, Elon has notified Tesla that he intends to purchase from Tesla, and Tesla expects that it will issue and sell to Elon, $20 million of Tesla’s common stock during the next open trading window at the then-current market price,” the filing states.

News of Musk’s stock purchase comes a day after the US District Court for the Southern District of New York approved the terms of a $40 million settlement with the Securities and Exchange Commission over fraud charges stemming from Musk’s early August tweet in which he declared his intention to take the company private.

READ: US judge approves Elon Musk's settlement with SEC over his Tesla go-private tweet

As part of the settlement, there will be no restriction on Elon’s ability to serve as Tesla’s CEO as well as his ability to sit on the company’s board.

However, Tesla and Musk will each pay a civil penalty of $20 million and Musk will be forced to resign as chairman of Tesla's board for a period of three years.

According to the filing, Tesla must appoint two independent directors to the board as well as a permanent board of independent directors whose membership will be subject to approval by the SEC staff. This committee will work to oversee management’s public statements regarding Tesla. Additional controls will also be imposed on Musk’s Twitter feed and his other public communications regarding Tesla.

The fraud suit filed against Tesla and Musk by the SEC came after Musk tweeted last August that he was considering taking Tesla private and said he had funding secured.

Am considering taking Tesla private at $420. Funding secured.

— Elon Musk (@elonmusk) August 7, 2018

The comment, which was later taken back, sent Tesla shares on a wild ride. Tesla shares jumped 1% to $279.38 in Wednesday's morning trading session. 

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Wed, 17 Oct 2018 09:32:00 -0400 https://ca.proactiveinvestors.com/companies/news/207297/elon-musk-is-set-to-buy-20-million-worth-of-tesla-stock-207297.html
<![CDATA[News - US judge approves Elon Musk's settlement with SEC over his Tesla go-private tweet ]]> https://ca.proactiveinvestors.com/companies/news/207211/us-judge-approves-elon-musk-s-settlement-with-sec-over-his-tesla-go-private-tweet-207211.html A US district court judge approved Tesla Inc (NASDAQ:TSLA) CEO Elon Musk's $40 million settlement with the Securities and Exchange Commission over fraud charges stemming from his early August tweet to take the company private, a report by Bloomberg said.

Judge Alison Nathan signed off on the deal Tuesday, after Musk and the SEC said the agreement was in the best interest of investors in the electric-car maker. The company will pay $20 million and Musk will also pay a $20 million penalty.

Musk had tweeted on August 7 that he planned to take the company private and that funding had been "secured," a claim that turned out to be not accurate and prompted some investors to sue him as a result.

Am considering taking Tesla private at $420. Funding secured.

— Elon Musk (@elonmusk) August 7, 2018

The plan was eventually abandoned by Musk and the SEC swiftly opened an investigation. Within a few days of the settlement, Musk fired off another tweet insulting the SEC.

Just want to that the Shortseller Enrichment Commission is doing incredible work. And the name change is so on point!

— Elon Musk (@elonmusk) October 4, 2018

Despite muddling the picture, the deal went ahead. 

Resolution of the case would allow Tesla to move on from the issue and go back to the business of producing electric vehicles.

READ: Tesla starts off 4Q with strong production numbers; Musk tweets about climate change

As part of the settlement, Musk agreed to relinquish the post of chairman of Tesla although he remains CEO.

The market welcomed news the settlement had been finalized, with Tesla shares hitting a session top of $273.88 and trading 3.66% up at $269.08.

Reporting by Rene Pastor, contactable on rene.pastor@proactiveinvestors.com

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Tue, 16 Oct 2018 11:10:00 -0400 https://ca.proactiveinvestors.com/companies/news/207211/us-judge-approves-elon-musk-s-settlement-with-sec-over-his-tesla-go-private-tweet-207211.html
<![CDATA[News - Tesla starts off 4Q with strong production numbers; Musk tweets about climate change ]]> https://ca.proactiveinvestors.com/companies/news/207018/tesla-starts-off-4q-with-strong-production-numbers-musk-tweets-about-climate-change-207018.html Tesla Inc (NASDAQ:TSLA) was once no stranger to production issues, but the electric-vehicle company seems to have found its way back on track lately.

The automaker is expected to have produced 11,500 cars so far in its fourth quarter, according to a report by Electrek. That number includes a total of about 7,400 Model 3s.

Tesla produced a total of 80,000 vehicles in its third quarter, including over 53,000 Model 3s.

The report stated that the automaker appears to have maintained its Model 3 production goal of 5,000 units per week.

Tesla has not yet issued production and delivery guidance for the fourth quarter, but the company stated previously that it intends to boost its Model 3 production.

Musk to the rescue?

In other Tesla news, CEO Elon Musk tweeted about his company’s place in the world.

Tesla exists to help reduce risk of catastrophic climate change, which affects all species on Earth. Even if your faith in humanity is faltering, this is worth caring about. Support makes a difference. Thank you.

— Elon Musk (@elonmusk) October 12, 2018

Scientists have pointed to climate change, which is exacerbated by car emissions, as a driving force behind natural disasters. The Florida Panhandle and other areas of the southeastern US were hit hard by Hurricane Michael about a month after Hurricane Florence ripped through the Carolinas.

Skeptics weighed in on Twitter, responding that Tesla exists to make money.

tesla exists to make you money https://t.co/H0GQTCX1TI

— Oliver Willis (@owillis) October 12, 2018

Musk responded that his reasoning behind wanting money is to solve Earth’s problems and build a self-sustaining city on Mars in case humans destroy the planet.

About half my money is intended to help problems on Earth & half to help establish a self-sustaining city on Mars to ensure continuation of life (of all species) in case Earth gets hit by a meteor like the dinosaurs or WW3 happens & we destroy ourselves

— Elon Musk (@elonmusk) October 12, 2018

Shares of Tesla were up more than 2% to US$258.17 in Friday afternoon trading.

--Updated to include additional tweets, most recent share price

 

Contact Lenore Fedow at lenore@proactiveinvestors.com

Follow her on Twitter: @LenoreMariee

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Fri, 12 Oct 2018 14:58:00 -0400 https://ca.proactiveinvestors.com/companies/news/207018/tesla-starts-off-4q-with-strong-production-numbers-musk-tweets-about-climate-change-207018.html
<![CDATA[News - Tesla customers need to act fast to be eligible for federal tax credit after Oct 15 deadline imposed ]]> https://ca.proactiveinvestors.com/companies/news/206989/tesla-customers-need-to-act-fast-to-be-eligible-for-federal-tax-credit-after-oct-15-deadline-imposed-206989.html Tesla Inc (NASDAQ:TSLA) sold its 200,000th car earlier this year. While that was great news for the automaker, the clock is ticking for customers hoping to score the US$7,500 federal tax credit granted to those who buy new electric vehicles.

The company added an October 15 deadline for orders to its website on Thursday.

READ: Tesla and embattled CEO Elon Musk back court approval of SEC settlement

The tax credit phases out once a manufacturer has sold 200,000 qualifying vehicles in the US, as per a TechCrunch report. As per the credit guidelines, Tesla customers will have to have their cars delivered by December 31.

While the tax credit information was shared previously, the deadline is new.

Customers ordering a Model X or Model S by the deadline should receive their vehicles in November, depending on the options chosen. A Model 3 could take up to eight weeks, as per Tesla’s estimates.

The deadline may encourage new orders, but the pressure is on to meet the deadline.

Tesla announced earlier this month that it had delivered 83,500 vehicles during the third quarter, ahead of Wall Street expectations and about 80% higher than all of its deliveries for 2017.

Shares of Tesla were up 2.6% to US$258.95 in Friday pre-market trading.

 

Contact Lenore Fedow at lenore@proactiveinvestors.com

Follow her on Twitter: @LenoreMariee

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Fri, 12 Oct 2018 08:58:00 -0400 https://ca.proactiveinvestors.com/companies/news/206989/tesla-customers-need-to-act-fast-to-be-eligible-for-federal-tax-credit-after-oct-15-deadline-imposed-206989.html
<![CDATA[News - Tesla and embattled CEO Elon Musk back court approval of SEC settlement ]]> https://ca.proactiveinvestors.com/companies/news/206896/tesla-and-embattled-ceo-elon-musk-back-court-approval-of-sec-settlement-206896.html Tesla (NASDAQ:TSLA) and its CEO Elon Musk are voicing their support for the $40 million settlement agreement reached this month with the Securities and Exchange Commission on the view that it serves investors’ interests, per a Reuters report.

“We therefore respectfully submit that the court should accept and enter the proposed consent judgements,” Tesla, Musk and the SEC wrote in a letter filed with the US District Court for the Southern District of New York.

The letter was part of a joint filing that came late on Wednesday and was first reported by Reuters.

The filing came after a US District Court judge last week ordered Musk as well as Tesla and the SEC to explain why the settlement deal they forged was “fair and reasonable”.

READ: Musk denies report James Murdoch in frame to become Tesla chair

As part of the deal struck with US regulators, Musk will pay a $20 million fine and stand aside as the chairman of Tesla for three years, but he will remain at the helm of the electric car maker as its CEO. Tesla has also agreed to pay a $20 million fine to settle the fraud lawsuit filed by the SEC.

In the wake of the legal action, Musk took to Twitter to mock the Securities and Exchange Commission, calling it the Shortseller Enrichment Commission.

Just want to that the Shortseller Enrichment Commission is doing incredible work. And the name change is so on point!

— Elon Musk (@elonmusk) October 4, 2018

At the center of the controversy which prompted the lawsuit was a tweet Musk sent in early August in which he said he was considering taking Tesla private and that funding had been secured.

Am considering taking Tesla private at $420. Funding secured.

— Elon Musk (@elonmusk) August 7, 2018

Musk eventually pulled the plug on the plan, but was sued by the SEC for misleading investors about having the funding to take Tesla private.

Tesla shares slipped 2.5% to $250.51 in Thursday’s pre-market session.

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Thu, 11 Oct 2018 07:41:00 -0400 https://ca.proactiveinvestors.com/companies/news/206896/tesla-and-embattled-ceo-elon-musk-back-court-approval-of-sec-settlement-206896.html
<![CDATA[News - Tesla's stock shorts earn $500 million as Elon Musk tweet may endanger deal with SEC, says S3 Partners ]]> https://ca.proactiveinvestors.com/companies/news/206516/tesla-s-stock-shorts-earn-500-million-as-elon-musk-tweet-may-endanger-deal-with-sec-says-s3-partners-206516.html Short sellers of Tesla Inc (NASDAQ:TSLA) reaped hundreds of millions of dollars when a tweet by company CEO Elon Musk slamming US regulators drove the price of the stock even lower on Friday, a report by S3 Partners said.

Musk dubbed the US Securities and Exchange Commission the "Shortseller Enrichment Commission" in apparent anger at being forced to pay a $20 million fine for his tweet to take Tesla private last month and that funding had been "secured."

Just want to that the Shortseller Enrichment Commission is doing incredible work. And the name change is so on point!

— Elon Musk (@elonmusk) October 4, 2018

Musk and the SEC had reached a settlement on the lawsuit the regulators filed against him for fraud on his now abandoned plan to take the company private. A US district court judge demanded that both Musk and the SEC explain next week why the deal is reasonable and fair.

"His (Musk's) actions could easily put the settlement at risk, depending on the attitude of the federal judge that must approve the deal," Ihor Dusaniwsky, the managing director of Predictive Analytics at S3 Partners, said in a report.

READ: Elon Musk slams SEC as US judge demands explanation for fraud settlement

Punters who are shorting Tesla's stock have had a field day with the stock.

"Since Musk agreed to step down as chairman, Tesla shares have slipped from $310 to $281, netting shorts $941 million, a return of 9.6% in less than a week," Dusaniwsky said.

"Friday’s reaction to the insulting tweet pushed the shares even lower and produced more than half a billion in paper profit for the shorts."

Tesla's stock closed on Friday in New York down 7.05% at $261.95. The stock recovered somewhat in afterhours trade by 0.26% to $262.63.

The shorts have been increasing their positions in the company following strong selling by Tesla longs because Musk has demonstrated a refusal to stay away from controversy.

READ: Greenlight Capital's David Einhorn compares Tesla's difficulties to those faced by Lehman Brothers, says CNBC

"The SEC is in the awkward position of coming up with ways to contain him without permanently damaging the small investors who speculate in the stock," the S3 official added.

The actions by Musk had invited scorn from investors like hedge fund manager David Einhorn, who slammed the Tesla CEO.

Tesla's go-private plan last month unravelled when his claim that funding was secured proved to be not true.

Reporting by Rene Pastor. Contact: rene.pastor@proactiveinvestors.com

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Fri, 05 Oct 2018 16:47:00 -0400 https://ca.proactiveinvestors.com/companies/news/206516/tesla-s-stock-shorts-earn-500-million-as-elon-musk-tweet-may-endanger-deal-with-sec-says-s3-partners-206516.html
<![CDATA[News - Elon Musk slams SEC as US judge demands explanation for fraud settlement ]]> https://ca.proactiveinvestors.com/companies/news/206427/elon-musk-slams-sec-as-us-judge-demands-explanation-for-fraud-settlement-206427.html Embattled Tesla Inc (NASDAQ:TSLA) chief executive Elon Musk slammed the US Securities and Exchange Commission just when a US district court judge ordered him and the SEC to explain by next week why the deal they forged to settle the lawsuit the government had filed against Musk is "fair and reasonable."

Musk renamed the SEC in a tweet as the Shortseller Enrichment Commission. There was no immediate reaction from the SEC.

Just want to that the Shortseller Enrichment Commission is doing incredible work. And the name change is so on point!

— Elon Musk (@elonmusk) October 4, 2018

Judge Alison Nathan gave both sides until October 11 to give their explanation through a joint statement.

"The Court has a duty to ensure the proposed consent judgment is fair and reasonable," the judge wrote in the order.

READ: Elon Musk and Tesla settle fraud charges with SEC, to pay $40M fine

The judge must approve the deal where Musk agreed to pay a $20 million fine and resign as chairman of Tesla over his tweet in early August to take the company private and that funding had been secured.

Am considering taking Tesla private at $420. Funding secured.

— Elon Musk (@elonmusk) August 7, 2018

Musk had jolted financial markets with the tweet. He eventually abandoned the plan and was sued by some market participants for misleading investors about having the funding for his go-private plan.

Former federal prosecutor Jay Hulings said in a report by CNBC: "It's odd given the nature of this settlement. If there is a class action, it's common. But just for SEC enforcement action, particularly with a big fine, it's unusual."

Federal courts have rejected SEC settlements in the past if the judge thinks they are too lenient, the report added.

Separately, the Wall Street Journal said billionaire businessman Mark Cuban talked with Musk for 15 minutes and convinced him to take the deal.

Safety second

In other news, Consumer Reports said the Cadillac Super Cruise was the top-rated partially automated driving vehicle over Tesla because it does the best job of balancing high-tech capabilities with ensuring that the car is operated safely and that the driver is paying attention.

In the rankings, Tesla's Autopilot came in second, followed by Nissan/Infiniti's ProPilot Assist and then Volvo's Pilot Assist System.

“We have been evaluating these systems on a case-by-case basis for a few years, but we are at a tipping point where they are now going mainstream,” said Jake Fisher, director of auto testing at Consumer Reports.

“Stacked up against each other, you can really see significant differences. The best systems balance capability with safeguards - making driving easier and less stressful in the right situations. Without proper safeguards, overreliance on the system is too easy, which puts drivers at risk,” he added.

Tesla said in its 3Q vehicle safety report that "we’ve registered one accident or crash-like event for every 3.34 million miles driven in which drivers had Autopilot engaged."

"We are working hard to make our cars the safest and most capable cars on the road in terms of passive safety, active safety, and automated driving," the electric carmaker said.

Contact Rene Pastor at rene.pastor@proactiveinvestors.com

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Thu, 04 Oct 2018 15:55:00 -0400 https://ca.proactiveinvestors.com/companies/news/206427/elon-musk-slams-sec-as-us-judge-demands-explanation-for-fraud-settlement-206427.html
<![CDATA[News - Tesla production better-than-expected but questions linger and stock is still a sell, says Goldman Sachs ]]> https://ca.proactiveinvestors.com/companies/news/206314/tesla-production-better-than-expected-but-questions-linger-and-stock-is-still-a-sell-says-goldman-sachs-206314.html Tesla Inc's (NASDAQ:TSLA) electric car deliveries in the third quarter came in higher than expected, but questions remain over vehicle demand and the stock remains rated as a Sell, investment bank Goldman Sachs said on Wednesday.

Goldman Sachs analyst David Tamberrino kept his Sell rating for Tesla and a $210 price target after the company's 3Q production numbers.

Shares of Tesla were trading near flat at $300.98 in early trade on Wednesday. 

The electric carmaker said it delivered 83,500 vehicles during the third quarter, beating Wall Street expectations and about 80% higher than all of its deliveries for 2017.

READ: Tesla stock revs up after it delivers 83,500 electric cars in third quarter

Tesla swept past its target of building at least 50,000 Model 3 cars in the third quarter. The company delivered 55,840 of its Model 3 sedans, it said.

Tamberrino said the better production and deliveries were "positive" in the quarter, but he still has questions on demand. 

For the Model 3, Tamberrino said company commentary points to a more limited sustainable demand at the current price point.

READ: Elon Musk's swift settlement with SEC a positive for Tesla but legal risks linger, analysts say

Goldman Sachs reinstated coverage of Tesla in early September after it stopped covering the stock due to its role as a financial adviser at a time when Tesla CEO Elon Musk was pursuing a plan to take the company private.

The plan was abandoned by Musk. He was sued for fraud over accusations he misled investors, but the Tesla CEO settled quickly with the US Securities and Exchange Commission.

Many analysts either downgraded Tesla or struck a neutral note following the settlement with the SEC.

Citi analyst Itay Michaeli downgraded Tesla to Sell from Neutral and lowered his price target to $225 from $356. JP Morgan analyst Ryan Brinkman reiterated an Underweight rating on Tesla with a $195 price target.

Analysts at Baird were optimistic that Tesla would be able to overcome its woes. Baird analysts Ben Kallo and David Katter wrote last month believe shares would be driven higher by strong fundamentals.

A separate investigation by the Department of Justice and a lawsuit by other investors remain pending. 

Tesla is the world's premier producer of electric vehicles.

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Wed, 03 Oct 2018 10:02:00 -0400 https://ca.proactiveinvestors.com/companies/news/206314/tesla-production-better-than-expected-but-questions-linger-and-stock-is-still-a-sell-says-goldman-sachs-206314.html
<![CDATA[News - Tesla stock revs up after it delivers 83,500 electric cars in third quarter ]]> https://ca.proactiveinvestors.com/companies/news/206205/tesla-stock-revs-up-after-it-delivers-83500-electric-cars-in-third-quarter-206205.html Tesla Inc (NASDAQ:TSLA) stock was on the rise Tuesday after the electric-car maker said it delivered 83,500 vehicles during the third quarter, beating Wall Street analysts' expectations and about 80% higher than all of its deliveries for 2017.

Indeed, Tesla breezed past its target of building at least 50,000 Model 3 cars in the third quarter, marking a level of production that is unparalleled for the car maker. The electric-car company delivered 55,840 of its Model 3 sedans, it said.

However, Tesla produced over 5,300 Model 3 cars in the last week of September, falling short of its target of 6,000, reported Reuters.

READ: Tesla Inc manufactures a record 80,000 vehicles in 3Q, says Elektrek report

The Model 3 sedan is key to loss-making Tesla’s profit plans and is part of its strategy of eventually becoming a mass-market car maker.

Over the weekend, Elon Musk reached a settlement over fraud charges with the Securities and Exchange Commission that requires him to relinquish his position as Tesla’s chairman and pay a $20 million fine. The company will also pay $20 million to US regulators.

Analysts at Baird, meanwhile, said the third-quarter delivery numbers were supportive of strong thrird quarter financial results. They reiterate their Outperform rating and $411 proce target on Tesla stock. 

"We think deliveries are good enough to support strong financial results for Q3; Model 3 production continues to ramp and deliveries exceeded consensus estimates. Additionally, TSLA indicated it plans to accelerate construction of its Shanghai factory to better compete in the Chinese market, though we continue to believe the company will not tap capital markets in 2018," wrote Baird analysts Ben Kallo and David Katter. 

"We expect shares to move higher into Q3 results, particularly as street estimates are raised to reflect solid deliveries," they added.

READ: Elon Musk's swift settlement with SEC a positive for Tesla but legal risks linger, analysts say

The analysts also said that Tesla's gigafactory enables the company to "drive down costs" through an industrialization of battery pack assembly and economies of scale.

"We think Panasonic's partnership could increase production efficiency and lower costs," wrote the analysts.

Tesla stock which was up nearly 2% to $316.79 in trading before the bell was up 0.38% Tuesday. 

Contact Uttara Choudhury at uttara@proactiveinvestors.com

Follow her on Twitter: @UttaraProactive 

-- (Updates with Baird analyst take, new share price) --  

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Tue, 02 Oct 2018 13:26:00 -0400 https://ca.proactiveinvestors.com/companies/news/206205/tesla-stock-revs-up-after-it-delivers-83500-electric-cars-in-third-quarter-206205.html
<![CDATA[News - Tesla Inc manufactures a record 80,000 vehicles in 3Q, says Elektrek report ]]> https://ca.proactiveinvestors.com/companies/news/206122/tesla-inc-manufactures-a-record-80000-vehicles-in-3q-says-elektrek-report-206122.html Tesla CEO Elon Musk is having a dreadful week, but the company (NASDAQ:TSLA) has some encouraging news. The electric-car maker manufactured a record 80,000 vehicles in the third quarter, per a report in Elektrek, which cited a source familiar with the matter.

Indeed, Tesla exceeded its target of building at least 50,000 Model 3 cars in the third quarter and built  80,000 vehicles, marking a level of production that is unparalleled for the car maker.

Efforts were made in the last hours to churn out more vehicles even after Tesla met its Model 3 production goal with over two days to go, according to the Elektrek report.

Of those 80,000 vehicles, Tesla manufactured about 53,000 Model 3 cars in the quarter, which represents a 187% jump in output from the previous quarter, per Elektrek.

Read: Elon Musk and Tesla settle fraud charges with SEC, to pay $40M fine

“Overall, Tesla produced almost as many cars this quarter as the last two quarters combined,” states the Elektrek report.

The company is set to report its third-quarter production figures to the public this week.

Over the weekend, Elon Musk reached a settlement over fraud charges with the Securities and Exchange Commission that requires him to relinquish his position as Tesla’s chairman and pay a $20 million fine. The company will also pay $20 million to US regulators.

Read: Elon Musk's swift settlement with SEC a positive for Tesla but legal risks linger, analysts say

The deal with regulators came after the SEC sued Musk and Tesla over a tweet that claimed Musk had the funding to take the electric-car maker private.  

In August, Musk tweeted that he was considering taking the company private at $420 per share and that he had “funding secured”. The tweet sent Tesla shares on a wild ride and Musk still faces a probe by federal prosecutors over the tweet.

Tesla shares jumped 14.5% to $303.22 in response to Musk’s settlement with the SEC.

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Mon, 01 Oct 2018 12:18:00 -0400 https://ca.proactiveinvestors.com/companies/news/206122/tesla-inc-manufactures-a-record-80000-vehicles-in-3q-says-elektrek-report-206122.html
<![CDATA[News - Elon Musk's swift settlement with SEC a positive for Tesla but legal risks linger, analysts say ]]> https://ca.proactiveinvestors.com/companies/news/206110/elon-musk-s-swift-settlement-with-sec-a-positive-for-tesla-but-legal-risks-linger-analysts-say-206110.html The rapid settlement by Tesla Inc CEO Elon Musk of the lawsuit filed by the US Securities and Exchange Commission (SEC) accusing him of fraud should be a positive for the company and its shares, but the legal woes confronting Musk and the electric-car maker will not dissipate anytime soon, analysts said on Monday.

JP Morgan analyst Ryan Brinkman said in a research note Musk's settlement with the SEC is a positive relative to the situation Tesla found itself in after the SEC charges were initially brought last Thursday.

Brickman believes, though, that Tesla's legal risks remain elevated, given the "plethora of now potentially bolstered shareholder class actions and any potential Department of Justice investigation" into Musk's aborted plan to take the company private.

READ: Elon Musk and Tesla settle fraud charges with SEC, to pay $40M fine

The settlement only covers the lawsuit filed by the SEC since the Justice Department probe, which may result in criminal charges, is a separate matter.

Brinkman kept an Underweight rating on shares of Tesla. He said the news reduces uncertainty as to who will lead Tesla and avoids a distracting and potentially lengthy trial. The fine Tesla itself must pay is "only a modest incremental negative," he added.

Citi analyst Itay Michaeli said while the settlement adds a "much needed dose of stability," it doesn't mark the end of the substantial legal, regulatory, and reputational risks that Musk's "go-private saga" created.

Michaeli said while the focus should now shift to third quarter performance, he worries that the ramifications of last week's events might linger on broader sentiment.

Michaeli raised his price target on Tesla shares to $258 from $225 given the reduced risk from the SEC settlement, but he kept a Sell rating on the stock.

READ: Tesla short-sellers increase positions while longs get out after Musk is sued by the SEC, says S3 Partners

Analysts following the stock believe it will recover ground lost last week when the shares crumbled.

"The settlement should allow company focus to return to its core objectives — building quality cars and advancing sustainable transportation. Negative headlines and the SEC investigations contributed to significant volatility in shares and could have been an internal distraction for Tesla, in our opinion," Baird Equity Research senior analyst Ben Kallo and research associate David Katter wrote in a research note.

"We believe the resolution of the SEC lawsuit should allow the company’s focus to return to producing cars and enable investors to focus on fundamentals, which we think are strong," they added.

Baird reiterated an Outperform rating for Tesla. The analysts noted that improved corporate governance, including the appointment of an independent chairperson/directors and increased oversight of Musk’s twitter communications and his continued leadership will be viewed positively by the market. There are several upcoming catalysts (including 3Q deliveries this week) to potnetially drive shares higher.

Baird set a price target of $411 for Tesla shares.

Shares of Tesla rose 17% to trade at $309.50 Monday morning, continuing premarket gains. The shares closed Friday down 13.9% at $264.77 after news of the SEC's lawsuit hit the market.

READ: Tesla faces criminal probe by US over Elon Musk's statements on aborted go-private plan

Morgan Stanley analyst Adam Jonas said the settlement could "substantially" reverse Friday's share price decline for Tesla.

In a research note to investors, Jonas admits that the settlement was "fast," but that it significantly lowers the risk of spillover effects on capital markets, company morale and brand value, and that the resolution avoided the worst case scenario, where a prolonged negative newsflow cycle would potentially impair access to capital and demand.

Additionally, Jonas notes that the fines appear to be much smaller than investors expected, and sees a chance for the board to be strengthened and diversified. Jonas maintains an Equal Weight rating and $291 price target on Tesla shares.

RBC Capital analyst Joseph Spak kept his Sector Perform rating on Tesla. The analyst said the deal with the SEC was a positive outcome for the company as it will allow it to continue raising capital and keep Musk as the CEO.

READ: Tesla chief Elon Musk faces lawsuit from short-seller Andrew Left of Citron Research

Baird said the 3Q delivery numbers due out on Wednesday, October 3, will likely be seen positively by the market. The company previously indicated it expects Model 3 deliveries to exceed production guidance of 50,000-55,000 and continues to target 100,000 Model S and X deliveries in 2018.

"There are several catalysts upcoming, which we think could drive shares higher. We think 3Q deliveries (expected this week), 3Q results in early November, and upcoming announcements of the new chairperson/directors could be positive. In an internal email, Musk reportedly indicated Tesla is 'very close to profitability' which we think would be a positive catalyst, as well," Baird explained.

Canaccord analyst Jed Dorsheimer said though the "distractions" have likely impacted operations and now predicts a miss in Model 3 production, at 48,000 vs. expectations of 50,000-55,000.

Dorsheimer, who maintains a Hold rating and $316 price target on Tesla shares, said he would become more constructive as details of who the new chairman and independent directors might be or a significant improvement in the operations and profitability of the company.

Tesla develops, manufactures, and sells electric vehicles as well as batteries for energy storage.

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Mon, 01 Oct 2018 09:57:00 -0400 https://ca.proactiveinvestors.com/companies/news/206110/elon-musk-s-swift-settlement-with-sec-a-positive-for-tesla-but-legal-risks-linger-analysts-say-206110.html
<![CDATA[News - Elon Musk and Tesla settle fraud charges with SEC, to pay $40M fine ]]> https://ca.proactiveinvestors.com/companies/news/206029/elon-musk-and-tesla-settle-fraud-charges-with-sec-to-pay-40m-fine-206029.html Embattled Tesla Inc (NASDAQ:TSLA) CEO Elon Musk has settled charges brought by the Securities and Exchange Commission stemming from a tweet last month claiming to have the funding to take the electric-car maker private.

According to the SEC, Musk has agreed to step down as chairman and pay a $20 million fine. The company will also pay $20 million.

Among the conditions of the settlement, the company must put controls in place to oversee all of Musk's communications with investors.

READ: Tesla faces criminal probe by US over Elon Musk's statements on aborted go-private plan

Musk will remain in his role as CEO. He neither admits nor denies the allegations as part of the settlement. He will be ineligible for re-election as board chairman for three years.

The deal is subject to court approval, the SEC said.

Tesla shares jumped 16% to $307 in premarket trading.

READ: SEC Settlement

In August, Musk tweeted that he was considering taking the company private at $420 per share and that he had "funding secured." The tweet sent Tesla shares on a wild ride.

Musk still faces a probe by federal prosecutors over the tweet.

Tela shares closed 13.9% lower to $264.77 Friday.

--Updates share price, adds Twitter oversight--

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Sat, 29 Sep 2018 18:01:00 -0400 https://ca.proactiveinvestors.com/companies/news/206029/elon-musk-and-tesla-settle-fraud-charges-with-sec-to-pay-40m-fine-206029.html
<![CDATA[News - Tesla short-sellers increase positions while longs get out after Musk is sued by the SEC, says S3 Partners ]]> https://ca.proactiveinvestors.com/companies/news/206016/tesla-short-sellers-increase-positions-while-longs-get-out-after-musk-is-sued-by-the-sec-says-s3-partners-206016.html Short-sellers of Tesla Inc (NASDAQ:TSLA) stock are increasing their positions in anticipation of the shares dropping further, while bulls in the electric-car maker are scrambling to close out their holdings and lock in whatever profits they can get, an analyst for S3 Partners said Friday.

"Short-sellers are adding to their positions in anticipation of further prices weakness," accordning to a research note provided to Proactive Investors by Ihor Dusaniwsky, the managing director of predictive analytics at S3 Partners, which closely follows the short side of the market in stocks like Tesla.

"The contacts I’ve talked to are showing me several hundred-thousand shares of new short selling in Tesla this morning," he told Proactive in an email interview.

Tesla's stock dropped to the Friday session low of $268.10 and was trading 11.5% down at $272.15 by midsession. On Thursday, the stock closed at $307.52.

READ: Tesla hit by flurry of downgrades after Elon Musk sued by SEC for fraud

With Tesla's shares falling by that much, "some long shareholders (have begun) closing out their positions to lock in whatever long-term gains are left in their trades," said Dusaniwsky.

Tesla market shorts took it on the chin in early August when Musk tweeted that he had secured funding for his plan to take the company private.

Am considering taking Tesla private at $420. Funding secured.

— Elon Musk (@elonmusk) August 7, 2018

The situation has now totally reversed.

"Short sellers took a $1.3 billion mark-to-market hit on August 7th, the day after The Tweet, but those that hung on to their positions or jumped into the deep end of the pool and shorted stock are now up $2.3 billi on in mark-to-market profits, making $3.6 billion in mark-to-market profits since August 8th," Dusaniwsky explained.

For Friday, he said "short sellers are up $1.27 billion in mark-to-market gains this morning."

READ: Tesla CEO Elon Musk sued by British cave rescue diver he called 'pedo guy' and 'child rapist'

The number of shares available for shorting and the fees involved provide a bonanza for Tesla shorts. Fees to borrow Tesla stock to short are seen 2.05% and general collateral stock borrows are quoted at 0.3% fee. Contrast that with fees for shorts in the Canadian cannabis company Tilray Inc (NASDAQ:TLRY), which hit 500% to 700% when the stock rallied to an all-time high of $300 this month.

"There are nearly 10 million shares available to borrow so there is plenty of room for more short sellers to get into the trade and stock borrow rates should not get much more expensive in the near term unless shares shorted increases by more than 3 million to 4 million shares," Dusaniwsky said.

"The conviction that longer-term Tesla short-sellers had in their thesis is finally paying off for them and may embolden those with excess capital and risk limits to increase their bets. We expect shares shorted to increase in the near term and if Tesla’s stock price continues to drop we could see shares shorted climb towards the 39 million to 41 million share levels we saw in May," he concluded.

Tesla is the world's biggest electric-car maker.

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Fri, 28 Sep 2018 12:47:00 -0400 https://ca.proactiveinvestors.com/companies/news/206016/tesla-short-sellers-increase-positions-while-longs-get-out-after-musk-is-sued-by-the-sec-says-s3-partners-206016.html
<![CDATA[News - Tesla hit by flurry of downgrades after Elon Musk sued by SEC for fraud ]]> https://ca.proactiveinvestors.com/companies/news/205917/tesla-hit-by-flurry-of-downgrades-after-elon-musk-sued-by-sec-for-fraud-205917.html Electric-car maker Tesla Inc (NASDAQ:TSLA) was hit by several downgrades on Friday after controversial CEO Elon Musk was sued by the US Securities and Exchange Commission for fraud over his now-abandoned plan to take the company private.

The controversy was triggered by a tweet from Musk last month about his go-private plan and that funding for the move had been "secured".

Am considering taking Tesla private at $420. Funding secured.

— Elon Musk (@elonmusk) August 7, 2018

Musk responded to the SEC's suit by saying "this unjustified action by the SEC leaves me deeply saddened and disappointed. I have always taken action in the best interests of truth, transparency and investors. Integrity is the most important value in my life and the facts will show I never compromised this in any way".

The tweet on his reaction appears to have since been removed.

Tesla itself was not named in the suit as a defendant, but its board issued a statement that they were “fully confident in Elon, his integrity, and his leadership of the company.”

The Wall Street Journal reported the SEC had crafted a deal for Musk, but his lawyers turned it down and they filed the case less than two months after his tweet.

Shares of Tesla were down 12.7% in the premarket to $269 after closing on Thursday 0.67% lower to $307.52.

READ: Tesla faces criminal probe by US over Elon Musk's statements on aborted go-private plan - Bloomberg

The cavalcade of reactions burst forth Friday.

Citi analyst Itay Michaeli downgraded Tesla to Sell from Neutral and lowered his price target to $225 from $356. "We think even after the post-close stock pullback (to $274), risk/reward is still tilted negatively," Citi said in a note to clients.

JP Morgan sees a "number of negative implications" for Tesla shares from the SEC suit. Analyst Ryan Brinkman reiterated an Underweight rating on Tesla with a $195 price target.

He wrote that the most significant negative relates to the SEC's request that the court prohibit Musk from serving as an officer or director of any public company, including Tesla. Such a move "could hasten the inevitable transition" of Tesla shares toward being valued based upon fundamentals alone, Brinkman informed investors in a research note.

Brinkman reiterated his belief that the Tesla's fundamentals "do not support a value close to the current trading price." Further, beyond this "key man risk" concern, which he believes "is of vital importance," he also see a number of other risks, including the potential for decreased confidence in the company on the part of investors, consumers and suppliers.

READ: Nomura Instinet downgrades Tesla shares and slashes price target by 25%

Tesla shares could lose $130 of 'Musk premium' if the SEC wins, Barclays said.The premium shareholders have been willing to pay for "future founder-driven business optionality" is likely to dissipate, Barclays analyst Brian Johnson said in a research note entitled "Lawsuit Secured."

The analyst reiterated an Underweight rating on the shares with a $210 price target. He believes that should the SEC be successful in barring Musk from serving as an officer or director, investors would focus back on the value of Tesla "as a niche automaker, rather than a founder-led likely disrupter of multiple industries."

The charges diminish the credibility of Musk as Tesla CEO, says Needham Needham analyst Rajvindra Gill, who kept his Underperform rating on Tesla, saying the downside in its stock is likely to continue.

The analyst contends that the latest charges by the SEC against Elon Musk for making "false and/or misleading statements" about taking the company private "all but eliminate" his credibility as a competent CEO.

Gill adds that the premium in the stock, which has been based on the "elusive" first mover advantage in electric vehicles is "rapidly shrinking" and that the hit to the company's brand cache linked with Musk may affect sales.

READ: Tesla chief Elon Musk faces lawsuit from short-seller Andrew Left of Citron Research

Oppenheimer analyst Colin Rusch was more cautious, telling investors in a research note that he believes two major variables are at play: How valuable is Musk to Tesla? And how much cash does the company need?

Rusch said next week's production and delivery numbers should provide insight into cash needs and the analyst also expects strong deliveries could help support its shares, noting legal worries will likely cap stock movement. Rusch has an Outperform rating on the shares.

The plan to go private was later dropped by Musk and investors have since filed a lawsuit over claims he misled investors.

The Justice Department is also investigating Musk over the issue.

Tesla is the world's biggest electric-car maker.

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Thu, 27 Sep 2018 16:30:00 -0400 https://ca.proactiveinvestors.com/companies/news/205917/tesla-hit-by-flurry-of-downgrades-after-elon-musk-sued-by-sec-for-fraud-205917.html
<![CDATA[News - Tesla shorts decline dramatically, says S3 Partners ]]> https://ca.proactiveinvestors.com/companies/news/205785/tesla-shorts-decline-dramatically-says-s3-partners-205785.html  The short interest in electric-car maker Tesla Inc (NASDAQ:TSLA) has fallen sharply in the past week as some investors apparently liquidated their positions after prices of the stock rose, according to a tweet from analytics company S3 Partners Wednesday.

Ihor Dusaniwsky, S3's managing director of predictive analytics, said the short interest in the company at this time is worth $9.96 billion and the number of shares shorted stood at 33.1 million, accounting for 25.95% of the float.

“Tesla shares shorted decreased by 566,000 over the last week as Tesla’s stock price rose over $20/share & shorts were down - $695 million in mark-to-market losses (down - $570 million year-to-date 2018,” his tweet said.

$TSLA short interest $9.96 billion, 33.09 million shares shorted, 25.95% of float. #Tesla shares shorted decreased by 566k over the last week as $TSLA's stock price rose over $20/share & shorts were down -$695 million in mark-to-market losses (down -$570 mm year-to-date 2018). pic.twitter.com/A92M2Wbwr8

— Ihor Dusaniwsky (@ihors3) 26 de setembre de 2018

Shares of Tesla were trading at $310.93, up 3.3% for the day.

In a tweet on September 20, Dusaniwsky said short interest in the stock was at $10.6 billion, up $668 million in September as Tesla's $5 drop in price was offset by more shares being shorted.

$TSLA shares shorted is 35.43mm .. it hit 35.44mm on 7/25; 35.45mm on 7/9; 35.52mm on 6/20; and the real jump to 37.94mm on 6/19 https://t.co/JIMsgUEKEh

— Ihor Dusaniwsky (@ihors3) 20 de setembre de 2018

 

$TSLA short interest is $10.595 billion, 35.43 million shares shorted, 27.79% of float. Shares shorted are up 743k shares over the last week. Previous chart was not updated. pic.twitter.com/L8kthRAVls

— Ihor Dusaniwsky (@ihors3) 20 de setembre de 2018

 

Tesla has been engulfed in controversy after CEO Elon Musk announced in a separate tweet in early August that he planned to take company private and that funding for the plan had been "secured."\The plan was eventually abandoned by Musk.

Tesla and Musk are under investigation by US regulators and officials, with some investors suing the company for misleading investors.

In other news, Bloomberg reported that Tesla's former head of human resources suggested to Musk that two employees who supported forming a union be given positions that could prevent them from advocating for a union.

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Wed, 26 Sep 2018 13:37:00 -0400 https://ca.proactiveinvestors.com/companies/news/205785/tesla-shorts-decline-dramatically-says-s3-partners-205785.html
<![CDATA[News - Tesla short interest keeps rising to nearly a third of the float ]]> https://ca.proactiveinvestors.com/companies/news/205472/tesla-short-interest-keeps-rising-to-nearly-a-third-of-the-float-205472.html The short interest in electric carmaker Tesla Inc (NASDAQ:TSLA) is rising to almost a third of the float, the managing director for Predictive Analytics at S3 Partners, Ihor Dusaniwsky, said.

Short interest in the stock is now worth US$10.595bn and that 35.43mln shares have been shorted, which accounts for 27.79% of the float, he said in a tweet.

$TSLA short interest is $10.595 billion, 35.43 million shares shorted, 27.79% of float. Shares shorted are up 743k shares over the last week. Previous chart was not updated. pic.twitter.com/L8kthRAVls

— Ihor Dusaniwsky (@ihors3) September 20, 2018

According to data from Yahoo Finance, Tesla's outstanding shares stood at 170.59mln and the float is at 127.52mln. Shares that were short as of July 30, 2018, reached 34.99mln shares.

Tesla was plunged into controversy last month over the aborted plan by CEO Elon Musk to take the company private.

READ: Tesla faces criminal probe by US over Elon Musk's statements on aborted go-private plan - Bloomberg

The US SEC and the Justice Department is now investigating Musk and Tesla to see if they misled investors, looking especially at the claim by Musk that funding had been secured for the plan. 

Eventually, it was found that the funding was not available for the go-private proposal.

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Fri, 21 Sep 2018 14:00:00 -0400 https://ca.proactiveinvestors.com/companies/news/205472/tesla-short-interest-keeps-rising-to-nearly-a-third-of-the-float-205472.html
<![CDATA[News - Tesla faces criminal probe by US over Elon Musk's statements on aborted go-private plan - Bloomberg ]]> https://ca.proactiveinvestors.com/companies/news/205161/tesla-faces-criminal-probe-by-us-over-elon-musk-s-statements-on-aborted-go-private-plan-bloomberg-205161.html Tesla Inc (NASDAQ:TSLA) is under investigation by the US Justice Department because of public statements made by the company and CEO Elon Musk over the go-private plan announced in early August, Bloomberg reported on Tuesday.

Federal prosecutors opened a fraud investigation over the tweets by Musk who said then that funding had been secured for the deal, the report said.

Am considering taking Tesla private at $420. Funding secured.

— Elon Musk (@elonmusk) August 7, 2018

Tesla said in a statement they have received "a voluntary request for documents" from the Justice Department.

“We have not received a subpoena, a request for testimony, or any other formal process. We respect the DOJ’s desire to get information about this and believe that the matter should be quickly resolved as they review the information they have received,” Tesla said.

READ: Tesla chief Elon Musk faces lawsuit from short-seller Andrew Left of Citron Research

Last month, the Tesla board formed a special panel which would have evaluated Musk's plan.

The proposal by Musk was eventually abandoned when it became apparent he did not have the funding to take the company private.

Musk was sued by some investors who accused him of misleading the market to burn those who were short on Tesla's stock.

Shares of Tesla dropped 4% to trade at US$283.08, having hit a session low of US$275.50 during Tuesday's session.

Baird Equity Research said probe will overhang Tesla stock, but fundamentals still look strong 

Baird Equity Research senior analyst Ben Kallo said in a note to clients on the heels of the report that the "investigations will be an overhang on the stock until more information is released."

He said based on the facts available, "we believe Musk will be liable for fines" but any punishment will not necessarily extend to Tesla.

Still, Kallo reiterated their Outperform rating on the stock and set a price target for Tesla of US$411.

"We continue to believe fundamentals are strong headed into Q3 deliveries, but we acknowledge the noise around the stock makes it challenging to invest on fundamentals, currently," the analyst said.

Production in Tesla seems to be ramping "in-line with expectations, and we think 2H:2018 results could exceed estimates, particularly given our belief deliveries of the Performance Model 3 should contribute to higher ASPs," the Baird report stated. 

Tesla develops, manufactures, and sells electric vehicles as well as batteries for energy storage.

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Tue, 18 Sep 2018 12:14:00 -0400 https://ca.proactiveinvestors.com/companies/news/205161/tesla-faces-criminal-probe-by-us-over-elon-musk-s-statements-on-aborted-go-private-plan-bloomberg-205161.html
<![CDATA[News - Tesla CEO Elon Musk sued by British cave rescue diver he called 'pedo guy' and 'child rapist' ]]> https://ca.proactiveinvestors.com/companies/news/205059/tesla-ceo-elon-musk-sued-by-british-cave-rescue-diver-he-called-pedo-guy-and-child-rapist--205059.html Controversial Tesla Inc (NASDAQ:TSLA) chief executive Elon Musk was sued Monday for libel and slander in US district court in California by the British rescue diver he called a "pedo guy" and "child rapist," a report by CNBC said.

British cave explorer Vernon Unsworth, who played a role in the rescue of a trapped Thai boys soccer team, is seeking US$75,000 in compensatory damages along with an injunction barring Musk to "refrain from making further publication of the False and Defamatory Accusations," according to court documents.

Musk has been a controversial figure over the past month, facing a lawsuit over accusations he misled investors when he announced plans in early August to take the company private.

READ: Tesla chief Elon Musk faces lawsuit from short-seller Andrew Left of Citron Research

"Musk's influence and wealth cannot convert his lies into truth or protect him from accountability for his wrongdoing in a court of law," the lawsuit by Unsworth said.

Respectively, Musk accused Unsworth of being a pedophile, child rapist, child sex trafficker, the husband of a 12-year old child bride and a liar.

Unsworth said all those accusations are not true. There was no immediate reaction from Musk for comment, CNBC said.

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Mon, 17 Sep 2018 15:50:00 -0400 https://ca.proactiveinvestors.com/companies/news/205059/tesla-ceo-elon-musk-sued-by-british-cave-rescue-diver-he-called-pedo-guy-and-child-rapist--205059.html
<![CDATA[News - Tesla reportedly loses another executive; largest institutional investor expresses concern about Musk’s behavior ]]> https://ca.proactiveinvestors.com/companies/news/204775/tesla-reportedly-loses-another-executive-largest-institutional-investor-expresses-concern-about-musks-behavior-204775.html Tesla Inc's (NASDAQ:TSLA) CEO Elon Musk has landed himself in hot water from appearing to smoke marijuana on a live-streamed podcast to drawing the attention of the US Securities and Exchange Commission after tweeting about the possible privatization of the electric vehicle company.

The drama surrounding the vehicle maker has taken its toll on the company’s executives, with chief accounting officer Dave Morton and head of human resources Gaby Toldeano exiting the company last week.

READ: Tesla loses its chief accounting officer and head of human resources; shares sink

Justin McNear, the company’s vice president of worldwide finance and operation, is stepping down as well, according to a Bloomberg report.

Asset manager Baillie Gifford's, Tesla’s largest institutional investor, is expressing frustration as well.

"He needs help, and I mean that psychologically as much as practically," said Baillie Gifford’s James Anderson, the fund manager of Scottish Mortgage Investment Trust, in an interview with Reuters.

Anderson told Reuters that he had spoken to Musk about his tweets and suggested that the CEO may be warming up to the idea accepting help, possibly hiring a chief operating officer.

Research house Nomura Instinet recently slashed its rating on Tesla shares to Neutral from Buy, citing Musk’s “erratic behavior.”

Shares of Tesla were up more than 3% to US$288.21 in Wednesday afternoon trading.

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Wed, 12 Sep 2018 15:45:00 -0400 https://ca.proactiveinvestors.com/companies/news/204775/tesla-reportedly-loses-another-executive-largest-institutional-investor-expresses-concern-about-musks-behavior-204775.html
<![CDATA[News - Nomura Instinet downgrades Tesla shares and slashes price target by 25%, says CNBC ]]> https://ca.proactiveinvestors.com/companies/news/204635/nomura-instinet-downgrades-tesla-shares-and-slashes-price-target-by-25-says-cnbc-204635.html A great fan of Tesla Inc (NASDAQ:TSLA) is abandoning his optimistic take on the electric-car maker’s shares due to Elon Musk’s questionable judgment and behavior, according to a CNBC article.

The research house Nomura Instinet has slashed its rating on Tesla shares to neutral from buy on fears that Musk’s recent behavior is holding back the company.

“We have been one of the most bullish on TSLA shares since initiating coverage last October. … We continue to believe that Tesla could be a lot bigger than it is today," analyst Romit Shah wrote to investors in a note entitled “No Longer Investable Tuesday,” reports CNBC.  

Read: Tesla stock falls after Musk drops go-private plan, but Baird analyst says it is ‘positive for all stakeholders’

“The issue though is the erratic behavior of CEO Elon Musk. During the second quarter, the switch seemingly flipped … We are worried that this behavior is tainting the Tesla brand, which in terms of value is most important.”

Shah also pared his price target on Tesla to US$300 from US$400.

Musk’s reputation has taken a hit over the last few months due to his engagement in tit-for-tat Twitter battles and his recent appearance on a live-streamed podcast with comedian Joe Rogan where he smoked marijuana, drank whiskey and wielded a sword.

Indeed, investors were put on edge in August after Musk proposed and then abruptly pulled the plug on a deal to take Tesla private.

The swirl of controversy now surrounding the automaker seems to have taken its toll on senior executives. Chief Accounting Officer Dave Morton announced last week that he would be leaving the company after just one month on the job due to the “level of public attention placed on the company”.

Read: Analysts at Baird label Tesla a 'Fresh Pick' and rate it a Buy, despite negative headlines

For every pessimist, there is an optimist, however, and Shah’s shift to downgrade Tesla shares follows a move by Baird analysts to label Tesla a “Fresh Pick” on the view that its strong fundamentals will “drive shares higher”.

Despite the negative headlines the company is seeing, Baird analysts Ben Kallo and David Katter feel that in the second half of the year, Tesla’s results could exceed estimates.

Tesla shares traded down 2.5% to US$278.50 in Tuesday’s pre-market session.

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Tue, 11 Sep 2018 07:59:00 -0400 https://ca.proactiveinvestors.com/companies/news/204635/nomura-instinet-downgrades-tesla-shares-and-slashes-price-target-by-25-says-cnbc-204635.html
<![CDATA[News - Analysts at Baird label Tesla a 'Fresh Pick' and rate it a Buy, despite negative headlines ]]> https://ca.proactiveinvestors.com/companies/news/204536/analysts-at-baird-label-tesla-a-fresh-pick-and-rate-it-a-buy-despite-negative-headlines-204536.html Baird analysts have labeled Tesla Inc (NASDAQ:TSLA) a “Fresh Pick” as they believe strong fundamentals would “drive shares higher,” despite negative headlines revolving around management turnover and executive leadership at the electric-vehicle maker. 

Analysts Ben Kallo and David Katter recently toured Tesla’s Fremont factory and came away satisfied.

“Elon Musk’s email to employees indicated Q3 would be 'the most amazing quarter in our history,' VIN registrations and the Bloomberg Model 3 tracker seem to imply production is on track, and insideEVs reported the company sold approximately 23k vehicles in August. We recently toured the Model 3 production lines in Fremont, and came away incrementally positive,” wrote Kallo and Katter in a note to clients.

Tesla stock closed on Monday nearly 8.5% higher at US$285.50, just off the session peak at US$286.03. 

READ: Tesla loses its chief accounting officer and head of human resources; shares sink

The analysts felt that in the second half of the year results could exceed estimates.

“We believe the continued focus on domestic deliveries is a positive read-through for demand; if Tesla were to shift focus to international deliveries instead of maximizing the federal tax credit in 2H:18 we think it could imply demand is soft. As a result, we view the company's focus on domestic deliveries positively,” they wrote.

Musk security review is inaccurate, says USAF

Separately, Air Force spokesperson Captain Hope Cronin said media reports suggesting the US Air Force is reviewing Tesla CEO Elon Musk’s security clearance are inaccurate, reported Reuters.

Musk has security clearance because another of his companies, SpaceX, provides satellite launch services to the US government.

Musk has taken shareholders on a wild ride lately, engaging in Twitter fights and recently appearing to smoke marijuana, drink whiskey and wield a sword on a live-streamed podcast with comedian Joe Rogan.

The fanfare surrounding the electric automaker appears to have also taken its toll on high-level executives. Chief Accounting Officer Dave Morton announced Friday that he would be leaving the company after just one month on the job, citing “the level of public attention placed on the company.”

READ: Elon Musk crows about EV sales, Twitter shares sink anew and Uber coming out with scooters

“Negative media coverage of the Rogan interview could be an overhang on shares, but we think investors will primarily focus on the executive turnover,” wrote the Baird analysts.

Shares of the electric carmaker closed trading at down 6.3% Friday, with investors on edge after a tumultuous August during which Musk proposed and then abruptly pulled the plug on a go-private deal.

“We believe Mr Morton’s departure reflects the intensity of Tesla’s work culture, and is not indicative of problems with fundamentals or financial reporting,” wrote the analysts.  

“While we expect investors will continue to question management turnover, particularly given intense scrutiny on the company, we do not think the turnover is indicative of problems with financial reporting at the company,” they added.

Contact Uttara Choudhury at uttara@proactiveinvestors.com

Follow her on Twitter: @UttaraProactive 

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Mon, 10 Sep 2018 07:40:00 -0400 https://ca.proactiveinvestors.com/companies/news/204536/analysts-at-baird-label-tesla-a-fresh-pick-and-rate-it-a-buy-despite-negative-headlines-204536.html
<![CDATA[News - Tesla loses its chief accounting officer and head of human resources; shares sink ]]> https://ca.proactiveinvestors.com/companies/news/204448/tesla-loses-its-chief-accounting-officer-and-head-of-human-resources-shares-sink-204448.html Tesla Inc (NASDAQ:TSLA) CEO Elon Musk has taken shareholders on a wild ride lately, engaging in Twitter fights and recently appearing to smoke marijuana on a livestreamed podcast. The fanfare surrounding the electric automaker appears to have also taken its toll on high-level executives.

Chief Accounting Officer Dave Morton announced Friday that he would be leaving the company after just one month on the job, citing “the level of public attention placed on the company.”

READ: TUT Report: Elon Musk crows about EV sales, Twitter shares sink anew and Uber coming out with scooters

"Since I joined Tesla on August 6, the level of public attention placed on the company, as well as the pace within the company, have exceeded my expectations," said Morton in an 8-K filing.

Morton was the former chief financial officer of Seagate Technology.

Tesla’s chief people officer Gaby Toledano took a leave of absence in August after a little over a year heading the company’s human resources department. Toledano also announced Friday that she would not return, as per a Bloomberg report.

Shares of Tesla fell more than 8% to US$257.61 in Friday morning trading before closing the week 6.35 off at US$263.24.

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Fri, 07 Sep 2018 09:27:00 -0400 https://ca.proactiveinvestors.com/companies/news/204448/tesla-loses-its-chief-accounting-officer-and-head-of-human-resources-shares-sink-204448.html
<![CDATA[News - Tesla chief Elon Musk faces lawsuit from short-seller Andrew Left of Citron Research ]]> https://ca.proactiveinvestors.com/companies/news/204377/tesla-chief-elon-musk-faces-lawsuit-from-short-seller-andrew-left-of-citron-research-204377.html Short-seller Andrew Left of Citron Research filed a lawsuit Thursday against the electric-car maker Tesla (NASDAQ:TSLA) and its CEO Elon Musk for alleged violation of securities laws.

The lawsuit from Left charges that Musk manipulated the price of Tesla shares by writing false tweets in a bid to “burn” the company’s short-sellers.

READ: Tesla stock falls after Musk drops go-private plan, but Baird analyst says it is ‘positive for all stakeholders’

The suit zeroes in on Musk’s tweet from August 7, 2018, in which he said he was considering taking Tesla private and had secured funding for the endeavor.

Am considering taking Tesla private at $420. Funding secured.

— Elon Musk (@elonmusk) August 7, 2018

The tweet set off a wave of controversy as investors raised questions about whether Musk could gather the money to support a privatization. In a blog entry posted on August 24, Musk later recanted and said Tesla would remain a public company.

Read: The complaint filed by Andrew Left against Tesla and Elon Musk in the US District Court: Northern District of California: San Francisco Division

Left claims that a number of short-sellers were forced to cover their positions in the wake of Musk’s tweets about taking Tesla private at US$420 per share, which pushed up the electric-car maker’s share price.

“Following these tweets, Tesla’s stock price surged, reaching an intraday high of US$387.46 per share, before closing at US$379.57 per share August 7, 2018, a nearly 11% jump from the previous closing price. Trading volume spiked to 30mln shares (compared to an average of 8mln), representing over US$11bn of purchases in the open market. In response to the tweets, many Tesla short-sellers were forced to cover their positions at artificially high prices, losing approximately US$1.3bn in a single day, according to media reports.”

Left’s lawyers, Labaton Sucharow LLP, announced the lawsuit in a press release.

 “This appears to be a textbook case of fraud,” said Michael Canty, a partner with the firm filing the suit on Left’s behalf. “We believe Musk attempted to manipulate the price of Tesla securities with false and misleading tweets, in a directed effort to harm short-sellers.”

Left is reported to have taken out short positions against Tesla for at least two years.

Tesla shares stayed flat in afternoon trade at US$279.72.

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Thu, 06 Sep 2018 14:46:00 -0400 https://ca.proactiveinvestors.com/companies/news/204377/tesla-chief-elon-musk-faces-lawsuit-from-short-seller-andrew-left-of-citron-research-204377.html
<![CDATA[News - Tesla shares seen slumping 30% in next six months due to increased competition, says Goldman Sachs ]]> https://ca.proactiveinvestors.com/companies/news/204154/tesla-shares-seen-slumping-30-in-next-six-months-due-to-increased-competition-says-goldman-sachs-204154.html Shares of Tesla Inc (NASDAQ:TSLA) could stumble by 30% in the next six months because of increased competition from other luxury carmakers, a report by Goldman Sachs (NYSE:GS) quoted by CNBC said. 

The network reported that Goldman analyst David Tamberrino has recommended a sell rating for Tesla stock because competition will cut into the company's share of the electric car market. Goldman had resumed coverage of Tesla after it dropped commenting on the stock when it was hired by Tesla chief executive Elon Musk on his go-private plans.

READ: Tesla stock falls after Musk drops go-private plan, but Baird analyst says it is ‘positive for all stakeholders’

"We see the medium-to-longer term industry backdrop as challenging for Tesla's products," Tamberrino was quoted in a note to clients by CNBC. "We believe the company will see pressure to its lead in EVs (electric vehicles) as competition catches up."

Tamberrino gave a US$210 six-month price target for Tesla's shares. The shares were trading down 2.1% at US$295.35 in the premarket on Tuesday. It was trading 1.8% lower at US$296.12 in early dealings. The stock closed on Friday at US$301.66, off 0.5% for the session. US financial markets were closed on Monday for a holiday.

READ: Is Tesla's dominance in luxury market under pressure as Mercedes to unveil new model?

The Goldman analyst said several large automakers such as Audi, BMW, Jaguar and Porshce are expected to launch their own electric vehicles in the coming years.

"With regional mandates and tightening CO2 standards, both traditional and new entrants are expected to launch several EVs in the coming years — with a large crescendo in the early-to-mid 2020s," Tamberrino said. "Altogether, we remain bearish on the company's ability to execute, achieve its targeted production ramp/margins, and sustain FCF [free cash flow] generation."

Musk sparked frenzied speculation in the markets when he announced his plan to take Tesla private early last month. He has abandoned that plan.

 

 

 

 

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Tue, 04 Sep 2018 09:44:00 -0400 https://ca.proactiveinvestors.com/companies/news/204154/tesla-shares-seen-slumping-30-in-next-six-months-due-to-increased-competition-says-goldman-sachs-204154.html
<![CDATA[News - Is Tesla's dominance in luxury market under pressure as Mercedes to unveil new model? ]]> https://ca.proactiveinvestors.com/companies/news/204071/is-tesla-s-dominance-in-luxury-market-under-pressure-as-mercedes-to-unveil-new-model-204071.html Tesla's (NASDAQ:TSLA) dominance in the luxury electric car market is likely to come under pressure as the German car beasts start to get in on the act.

Tomorrow (Tuesday) Daimler-owned (OTC:DDAIF) Mercedes is poised to unveil its much-anticipated electric SUV (sport utility vehicle) in Stockholm.

The auto - called the EQC -  is due to make first customer sales next year and will be priced in the vicinity of Tesla’s US$49,000 Model 3.

Tesla's Model 3 sedan sales are expected to reach around 50,000 cars this year and almost double that in 2019, though this may be questionable based on today's news that it had reportedly missed its target of making 6,000 a week, and only made 4,300 units in the last week of August.

READ: Dyson planning to build an electric car test track as it gears up to become a possible rival for Tesla

The launch of the EQC will be followed by electric vehicle debuts from BMW and Audi.

According to one line of research, there is likely to be a steady decline in Tesla’s share of the exploding electric-car market over the next decade, from today’s 12.3% of the market, dropping to 2.8%.

Elon Musk led Tesla, as usual, hasn't been out of the news of late, for various reasons.

Last week, Dyson, a company more usually associated with vacuum cleaners, is reportedly planning to build a 10-mile test track in Wiltshire where the privately-owned firm will put new electric cars through their paces.

Reportedly, this is part of a plan by the firm, founded by inventor James Dyson, to start selling a "radical" electric car from 2021.

Tesla Inc (NASDAQ:TSLA) shares closed Friday, down 0.49% to stand at C$301.66.

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Mon, 03 Sep 2018 09:38:00 -0400 https://ca.proactiveinvestors.com/companies/news/204071/is-tesla-s-dominance-in-luxury-market-under-pressure-as-mercedes-to-unveil-new-model-204071.html
<![CDATA[News - Chinese Tesla rival NIO revs up US$1.3bn IPO on NYSE ]]> https://ca.proactiveinvestors.com/companies/news/203815/chinese-tesla-rival-nio-revs-up-us13bn-ipo-on-nyse-203815.html Shanghai-based electric-vehicle maker NIO Inc, which has billed itself as a potent rival to Tesla, is seeking to raise US $1.3bn in an initial public offering (IPO) and planning to list on the New York Stock Exchange. 

In a filing with the Securities and Exchange Commission, NIO registered an IPO of its American depositary shares. The Chinese upstart has launched an offering of 160 million ADRs at a price range of US$6.25 to US$8.25. That values the company at up to US$8.5bn ahead of its trading debut in about two weeks.

The electric-car maker plans to list its shares on the New York Stock Exchange under the symbol "NIO."

At the top of the price range, NIO would raise gross proceeds of US$1.32bn. The company could raise as much as US$1.52bn in total if an option to sell 15% more stock is exercised after the shares begin trading, according to the Wall Street Journal.

READ: Tesla stock falls after Musk drops go-private plan, but Baird analyst says it is ‘positive for all stakeholders’

Through the NYSE listing, NIO is building its war chest to take on Tesla, which is arguably the world’s No 1 global electric vehicle maker. The Chinese carmaker is already demonstrating a strong cost advantage. In December 2017, Nio launched the NIO ES8, a seven-seater electric SUV, at about half the price of Tesla's Model X in China. The ES8 is Nio's first mass-produced model for the China market and has a base price of 448,000 yuan (US$65,000).

As of July 31, 2018, NIO delivered 481 ES8s and had unfulfilled reservations for more than 17,000 ES8s with deposits, of which 4,989 reservations were made with non-refundable deposits. It plans to launch another lower-priced, five-seater electric SUV, the ES6, by the end of 2018.

Investors shouldn’t get the impression that NIO is just a cheap electric-car maker. It has higher aspirations. In 2016, NIO developed the EP9 supercar, a 1,360-horsepower speedster to challenge high-end sports cars with British racing driver Oliver Turvey and Italian racer Luca Filippi behind the wheel.

The intent with the supercar or concept racer was to check out the performance, assess the technology, and reuse a lot of that in NIO’s mass-market vehicles.

Corporate America first woke up to the Chinese presence when NIO founder William Li, dubbed the “Elon Musk of China,” managed to lure Silicon Valley innovator Padmasree Warrior from Cisco Systems Inc (NASDAQ: CSCO) two years ago to head up NIO in America and be global chief development officer. She has built NIO’s 85,000-square-foot R&D center in San Jose, California by hiring some of America’s top artificial intelligence, robotics and electric car experts.    

READ: Tesla may soon swing to a profit as Model 3 demand revs up

NIO now has research and design centers in Shanghai, London, Hong Kong, Munich and California.

According to the Wall Street Journal, NIO was last valued at US$5bn in a private capital raise in November 2017. The paper said NIO’s shareholders included entities affiliated with Chinese internet giant Tencent Holdings Ltd. and China-focused investment firm Hillhouse Capital Group.

NIO is riding on strong growth in China’s booming electric-vehicle market and is firing on all pistons.

“It rented a large stadium for the launch of its first car in Beijing late last year, flying in thousands of employees from around the world as well as US rock band Imagine Dragons to provide the entertainment,” reported the Journal.

The Chinese electric car maker is planning to build a network of 1,200 mobile charging vans and 1,100 battery swap stations by 2020 that will allow NIO drivers to switch out their car batteries for freshly charged ones.

Contact Uttara Choudhury at uttara@proactiveinvestors.com

Follow her on Twitter: @UttaraProactive 

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Wed, 29 Aug 2018 10:18:00 -0400 https://ca.proactiveinvestors.com/companies/news/203815/chinese-tesla-rival-nio-revs-up-us13bn-ipo-on-nyse-203815.html
<![CDATA[News - Tesla stock falls after Musk drops go-private plan, but Baird analyst says it is ‘positive for all stakeholders’ ]]> https://ca.proactiveinvestors.com/companies/news/203625/tesla-stock-falls-after-musk-drops-go-private-plan-but-baird-analyst-says-it-is-positive-for-all-stakeholders-203625.html Shares of Tesla Inc. (NASDAQ:TSLA) skidded in premarket trade Monday after the electric-car maker dropped plans to go private, but analysts at Baird said the U-Turn is good news in the long run.

The stock fell 3.5% to US$312 in premarket trade, after closing Friday at $322.82. 

Tesla founder CEO Elon Musk abruptly abandoned a plan to take his electric carmaker private writing in a blog post late Friday that taking Tesla private was too complicated and distracting, and that it was “better off as a public company.”

READ: Tesla is hit by barrage of negative reports as problems mushroom over plan to go private

Musk and Tesla are facing investor lawsuits and a US Securities and Exchange Commission investigation into the truthfulness of the CEO’S August 7 tweets. Under the circumstances, Musk’s decision to “abandon a plan to take his electric carmaker private will not resolve his mounting regulatory and legal woes, and may even make them worse,” some securities lawyers told Reuters.

Meanwhile, Baird analysts Ben Kallo, a longtime Tesla bull, and David Katter said investors should expect Tesla shares to come under pressure in the near term as they question the outcome of staying public.

“That said, we expect shares to appreciate over the intermediate term as the focus shifts back to fundamentals, which we believe may be underappreciated,” wrote the Baird analysts in a note to clients Monday.

“We are buyers on weakness as we expect shares to move higher ahead of Q3 deliveries and results,” they added.

READ: Tesla CEO Elon Musk rebuffs Arianna Huffington's calls for him to take time off

The analysts said investors should now be able to refocus on fundamentals, with a potential bump coming as Tesla appears to have made “significant progress on the Model 3 production ramp.”

“Tesla has averaged nearly 1,500 VIN (vehicle identification number) registrations per day so far in August, which is an imperfect, but directional way to track production,” wrote Kallo and Katter.  

“We believe progress on the Model 3 production ramp could be a significant positive catalyst for the stock,” they added.

If Tesla achieves its production targets, investors may be underestimating adjusted earnings, they added.

Baird analysts have held an outperform rating on Tesla since early 2016, with a current price target of $411.

Contact Uttara Choudhury at uttara@proactiveinvestors.com

Follow her on Twitter: @UttaraProactive 

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Mon, 27 Aug 2018 08:00:00 -0400 https://ca.proactiveinvestors.com/companies/news/203625/tesla-stock-falls-after-musk-drops-go-private-plan-but-baird-analyst-says-it-is-positive-for-all-stakeholders-203625.html
<![CDATA[News - Tesla's Musk hires Morgan Stanley as adviser in go-private move ]]> https://ca.proactiveinvestors.com/companies/news/203514/tesla-s-musk-hires-morgan-stanley-as-adviser-in-go-private-move-203514.html Tesla Inc (NASDAQ:TSLA) chief Elon Musk has retained Morgan Stanley as an adviser in his controversial move to take the electric carmaker private, media reports said on Thursday.

Charles Gasparino of Fox Business New tweeted about the move by Musk, who has been besieged ever since he announced the plan to take the company private earlier in August.

SCOOP @elonmusk retains @MorganStanley as his adviser for @Tesla privatization attempt more on @FoxBusiness

— Charles Gasparino (@CGasparino) August 23, 2018

Having earlier hired Goldman Sachs and now Morgan Stanley, Musk has retained the services of the two top merger advisers in the US, according to Bloomberg.

READ: Tesla hires crisis communications firm in attempt to repair tattered image, according to reports

The SEC is investigating the plan by Musk and Tesla's board has formed a panel of three directors to study the proposal.

Musk has even run into demands by some observers to step down, a suggestion he immediately rejected.

 

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Thu, 23 Aug 2018 14:01:00 -0400 https://ca.proactiveinvestors.com/companies/news/203514/tesla-s-musk-hires-morgan-stanley-as-adviser-in-go-private-move-203514.html
<![CDATA[News - Tesla board special panel hires crisis communications firm in attempt to repair tattered image, reports say ]]> https://ca.proactiveinvestors.com/companies/news/203427/tesla-board-special-panel-hires-crisis-communications-firm-in-attempt-to-repair-tattered-image-reports-say-203427.html A special committee formed by the Tesla Inc (NASDAQ:TSLA) board is trying to repair its bruised image by hiring a crisis communication company, Joele Frank,  according to reports, after the recent controversy by chief executive officer Elon Musk to take the company private.

Charles Gasparino of Fox Business News tweeted on Wednesday:

SCOOP--to help repair its image @tesla retains crisis communications firm Joele Frank more later on @FoxBusiness $TSLA

— Charles Gasparino (@CGasparino) August 22, 2018

An official working with Tesla clarified the tweet by saying that it was the special committee of the board studying the go-private move that hired Joelle Frank to handle media inquiries on the proposal. Tesla itself did not hire the communications company, the official added.

In another tweet yesterday, Gasparino claimed Tesla is turning to Wall Street as it prepares to make a run towards privatization and to restructure the electric car maker.

SCOOP: @Tesla turning to Wall Street as it prepares to make a run at privatization/restructuring of electric car maker; @elonmusk retains @GoldmanSachs & Silver Lake Partners as part of the effort; @Morgan Stanley also likely to be retained in coming days more NOW @FoxBusiness

— Charles Gasparino (@CGasparino) August 21, 2018

The announcement by Musk in early August that he wanted to take Tesla private jolted Wall Street. The news sent shares tumbling almost 5%. 

The Tesla chief executive said he had secured funding for the plan and that a Saudi Arabian sovereign wealth fund supported the move and was keen to proceed.

READ: Tesla is hit by barrage of negative reports as problems mushroom over plan to go private

The Tesla board appointed three directors to study the plan while the SEC investigates over complaints that he misled investors.

Investment bankers are now faced with a dilemma regarding Musk's plan for Tesla, Reuters reported. They could overlook concerns about the feasibility of the deal or, alternatively, risk missing out on what could be the year's biggest and most high-profile acquisition.

Morgan Stanley and Goldman Sachs have either dropped or restricted their coverage of Tesla because of their involvement in the go-private transaction.

Shares of Tesla were at US$322.35 on Wednesday. 

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Wed, 22 Aug 2018 14:54:00 -0400 https://ca.proactiveinvestors.com/companies/news/203427/tesla-board-special-panel-hires-crisis-communications-firm-in-attempt-to-repair-tattered-image-reports-say-203427.html
<![CDATA[News - Tesla is hit by barrage of negative reports as problems mushroom over plan to go private ]]> https://ca.proactiveinvestors.com/companies/news/203252/tesla-is-hit-by-barrage-of-negative-reports-as-problems-mushroom-over-plan-to-go-private-203252.html Tesla Inc's (NASDAQ:TSLA) problems are mushrooming as the tumultuous developments that have enguled the electric carmaker seems to be spreading, media reports said on Monday.

The Wall Street Journal reported that some suppliers of Tesla are worried about getting paid as they fret about the company's financial strength. A recent survey by an automative supplier association said that 18 of 22 respondents believe Tesla is now a financial risk to their companies, the Journal reported.

Charles Gasparino of Fox Business News tweeted that "lawyers believes SEC is under pressure to expedite investigation; co officials could meet with SEC  this week; SEC faces pressure to act swiftly but not blow up any potential privatization deal that wld be good for investors--co sources."

READ: Tesla CEO Elon Musk rebuffs Arianna Huffington's calls for him to take time off

Musk has come under siege since nearly the beginning of the month after he revealed plans to take Tesla private.

Tesla's board has even formed a special committee to study the possibility.

Late on Monday, JP Morgan slashed its stock price target to US$195 from US$308 as its analysts concluded that funding for taking the company private is not there, a report by MarketWatch said. Musk had earlier claimed that Saudi Arabica's sovereign wealth fund supported the idea of taking Tesla private and was keen to proceed.

Shares of Tesla dropped in early trade on Monday to a session low of US$288.20 before recovering to end up 0.96% at US$304.44. 

Last week, Musk told the New York Times that no one reviewed his tweet about taking the company private. He has already received a subpoena from the SEC on the matter.

 

 

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Mon, 20 Aug 2018 16:02:00 -0400 https://ca.proactiveinvestors.com/companies/news/203252/tesla-is-hit-by-barrage-of-negative-reports-as-problems-mushroom-over-plan-to-go-private-203252.html
<![CDATA[News - SpaceX shareholders don't want to be involved in taking Tesla private, Axios reports ]]> https://ca.proactiveinvestors.com/companies/news/203251/spacex-shareholders-don-t-want-to-be-involved-in-taking-tesla-private-axios-reports-203251.html As discussions about whether the electric-car maker Tesla (NASDAQ:TSLA) will be taken private snowball, one idea generating talk is whether SpaceX, Elon Musk’s privately-held rocket company, would help to fund the privatization and take an ownership stake.

Shareholders in SpaceX polled by the news outlet Axios think Musk might pledge either some or all of his stake in SpaceX, which was valued last year at US$21bn, to fund Tesla’s privatization.

But the SpaceX shareholders who spoke to Axios wouldn’t be happy if Musk were to make such a move as they don’t want the rocket company to be involved in financing a Tesla buyout in any way.

Read: Tesla CEO Elon Musk rebuffs Arianna Huffington's calls for him to take time off

“These folks believe they have shares in the Musk company with profits and a deep management bench, and see no reason to marry it with the opposite,” the Axios article said. “They will go nuts if SpaceX itself tries to finance the Tesla buyout, at least in any meaningful way."

A final conclusion is that while SpaceX is profitable, its earnings before interest and tax is “quite narrow and could blow up if a rocket or two does.” So, it would be difficult for Tesla to rely on financing measures provided by SpaceX.

Tesla shares were trading 1.8% lower at US$300.10 in afternoon trade.

Contact Ellen Kelleher at ellen@proactiveinvestors.com

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Mon, 20 Aug 2018 13:52:00 -0400 https://ca.proactiveinvestors.com/companies/news/203251/spacex-shareholders-don-t-want-to-be-involved-in-taking-tesla-private-axios-reports-203251.html
<![CDATA[News - Tesla CEO Elon Musk rebuffs Arianna Huffington's calls for him to take time off ]]> https://ca.proactiveinvestors.com/companies/news/203226/tesla-ceo-elon-musk-rebuffs-arianna-huffington-s-calls-for-him-to-take-time-off-203226.html Tesla Inc (NASDAQ:TSLA) CEO Elon Musk is rebuffing internet titan Arianna Huffington’s latest calls to encourage him to take time off and rest and says he has no option but to continue to work at a dogged pace as he considers taking the electric car maker private.

Shooting off another tweet in the early hours of Sunday, Musk said he had just got home from the factory where he is working to make sure the production of Tesla Model 3 cars keeps its pace. “You think this is an option. It is not,” he wrote.

Ford & Tesla are the only 2 American car companies to avoid bankruptcy. I just got home from the factory. You think this is an option. It is not.

— Elon Musk (@elonmusk) August 19, 2018

Musk’s tweet came in response to an open letter from Huffington, the founder of the Huffington Post, which encouraged him to stop “working 120-hour weeks at the expense of seeing your children and your friends”.

Read: Tesla board goes into damage control mode as SEC ramps up Tesla investigation after Elon Musk's tweet

“Elon, the future of Tesla depends on you coming up with your masterpiece. It doesn’t depend on how many hours you’re awake,” she wrote.

Musk seems intent on staying at the helm of Tesla in the face of the ongoing controversy and scrutiny which has accelerated since August 7, when he sent a tweet saying he had secured funding to take the electric-car maker private at US$420 per share.

Musk’s acknowledgement that he takes the sedative Ambien to sleep as well as news of a likely investigation by the Security and Exchange Commission into the company are escalating a new push by Tesla’s board of directors to rein in Musk and appoint a key number 2 executive to take the pressure off Musk and relieve him of some of his day-to-day responsibilities.

Saudi fund in talks for stake in another US electric-car maker

Over the weekend, the story surrounding the company became even more convoluted as it emerged in a Reuters report that Saudi Arabia’s sovereign wealth fund – which Musk had been in discussions with to take Tesla private – was contemplating acquiring a more than US$1bn stake in Lucid Motors, another US electric-car maker.

Tesla shares plunged by nearly 9% on Friday to finish the day at US$305.50 in the wake of the publication of a wide-ranging interview with The New York Times in which Musk referred to the last year as “the most difficult and painful” one of his career.

Tesla shares were trading 5.4% lower at US$289.00 in pre-market trade.

Contact Ellen Kelleher at ellen@proactiveinvestors.com

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Mon, 20 Aug 2018 08:04:00 -0400 https://ca.proactiveinvestors.com/companies/news/203226/tesla-ceo-elon-musk-rebuffs-arianna-huffington-s-calls-for-him-to-take-time-off-203226.html
<![CDATA[News - Tesla whistleblower tweets photos of allegedly damaged batteries he says were installed in cars ]]> https://ca.proactiveinvestors.com/companies/news/203076/tesla-whistleblower-tweets-photos-of-allegedly-damaged-batteries-he-says-were-installed-in-cars-203076.html The bad news just keeps piling up for Tesla Inc (NASDAQ:TSLA).

A former Tesla process technician, Martin Tripp, who was fired from Tesla and then sued by the company, has now tweeted a number of internal emails and photos that allegedly show damaged batteries and flawed practices at Tesla’s battery factory, according to CNBC.

Tripp has gone out on a limb to warn Tesla car owners who he claims received faulty, punctured battery cells.

“The lists of vehicle identification numbers, which he wrote in the tweets, refer to specific cars that received batteries containing damaged cells that never should have been installed,” reported CNBC.

Tripp also tweeted pictures that he claims prove Tesla is storing waste or scrap in open parking lots and trucks at the Gigafactory, rather than temperature-controlled warehouses.

The former Tesla technician also shared screenshots of graphics that he says show a high volume of waste at the factory.

The tweets in question have been taken down.

Tesla has characterized Tripp as a disgruntled ex-employee and saboteur in the past.

"As we've said before, these claims are false and Mr Tripp does not even have personal knowledge about the safety claims that he is making,” a Tesla spokesperson told CNBC.

“No punctured cells have ever been used in any Model 3 vehicles in any way, and all VINs that have been identified have safe batteries. Notably, there have been zero battery safety issues in any Model 3," the spokesperson added.

This is not Tripp’s first controversial tango with Tesla. In June, Tesla sued Tripp for US$1mln alleging he leaked information to the media with the intent to sabotage the car maker. Tripp countered with a whistleblower tip to the US Securities and Exchange Commission slamming Tesla for putting customers at risk.

A second former Tesla employee has filed a formal whistleblower complaint with the Securities and Exchange Commission, alleging the automaker failed to disclose to shareholders that authorities had uncovered an alleged drug trafficking ring involving employees at its Gigafactory plant in Nevada, reported Jalopnik. 

Karl Hansen, a former member of Tesla’s internal security department and its investigations division is offering up claims that go far beyond the alleged manufacturing issues highlighted by Tripp.

“I hope that shining a light on Tesla’s practices will cause appropriate governmental action against the company and its management,” Hansen said in a statement.

Tesla stock declined 0.92% to US$335.59.

Contact Uttara Choudhury at uttara@proactiveinvestors.com

Follow her on Twitter: @UttaraProactive

-- Updates with second whistleblower complaint, stock update -- 

 

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Thu, 16 Aug 2018 08:41:00 -0400 https://ca.proactiveinvestors.com/companies/news/203076/tesla-whistleblower-tweets-photos-of-allegedly-damaged-batteries-he-says-were-installed-in-cars-203076.html
<![CDATA[News - Tesla board goes into damage control mode as SEC ramps up Tesla investigation after Elon Musk's tweets ]]> https://ca.proactiveinvestors.com/companies/news/202996/tesla-board-goes-into-damage-control-mode-as-sec-ramps-up-tesla-investigation-after-elon-musk-s-tweets-202996.html Tesla Inc (NASDAQ:TSLA) board members are “racing to inoculate themselves” from the fallout as the Securities and Exchange Commission (SEC) ramps up its investigation into Tesla CEO Elon Musk’s tweets that he was taking the electric carmaker private.

FOX Business’ Charlie Gasparino reported that the investigation is now "formal."

“The San Francisco office of the SEC has sent subpoenas to Tesla regarding its privatization plans and Musk’s statement to determine whether the billionaire inventor intentionally misled investors,” reported Fox Business. 

The news channel said Tesla has hired two law firms, Paul, Weiss, Rifkin, Wharton & Garrison to help deal with the SEC, and Latham & Watkins to advise on privatization.

READ: Musk claims funding for Tesla going-private deal will be done with equity as Saudis eager to proceed

Last week, Musk shocked investors after tweeting that he could take the company private at US$420 per share, the stock soared on the news before being halted. Tesla stock has since languished, falling 3.30% to US$336.18 Wednesday.

Both Tesla and the SEC have declined to comment about the investigation.

Meanwhile, members of Tesla’s board are scrambling to muzzle Musk who some directors think “is out of control.”

“In recent days, according to people familiar with the matter, some of his fellow board members delivered a stern message: Stop tweeting,” reported The New York Times.

It won’t surprise anyone that Musk hasn’t heeded that advice and has continued to post messages on Twitter. Of course, Musk might learn the hard way that it’s one Twitter message too many. If the SEC concludes Musk's funding disclosure was not accurate, which appears to be the case a week later, it could create major legal issues for the Tesla founder.

Musk has 22.3 million followers on Twitter and exploits the social media platform much like President Trump to provide an extraordinary unfiltered insight into what he is doing and thinking in real time. Musk routinely uses Twitter to spar with short sellers who are betting against Tesla shares and needle journalists who question the car maker’s prospects.

READ: Wall Street analysts weigh in on Tesla's potential path to privatization

The pitch is now so queered that three Tesla directors have separately hired the law firm Latham & Watkins to advise them as they consider any proposal by Musk to take the company private, said the New York Times.

The company cautioned Tuesday that a special committee of three directors hadn’t concluded whether taking Tesla private would be advisable or feasible, reported Bloomberg.  

Meanwhile, two days after Musk jumped the gun and said he was "excited to work with Silver Lake and Goldman Sachs" as financial advisers in his bid to take Tesla private, at least half of the tweet has been confirmed by reading the tea leaves.

In a note to clients, as reported by the Business Insider, Goldman Sachs said it was suspending research coverage of Tesla because it was "acting as a financial advisor in connection with a matter that is fundamental to the reasonable analysis of the rating and price target for the stock."

It is standard practice for a bank to suspend research coverage when its investment banking unit does business with a company.

Contact Uttara Choudhury at uttara@proactiveinvestors.com

Follow her on Twitter: @UttaraProactive 

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Wed, 15 Aug 2018 15:01:00 -0400 https://ca.proactiveinvestors.com/companies/news/202996/tesla-board-goes-into-damage-control-mode-as-sec-ramps-up-tesla-investigation-after-elon-musk-s-tweets-202996.html
<![CDATA[News - Tesla board forms special committee to study taking company private ]]> https://ca.proactiveinvestors.com/companies/news/202870/tesla-board-forms-special-committee-to-study-taking-company-private-202870.html The board of electric carmaker Tesla Inc (NASDAQ:TSLA) said Tuesday it has formed a special committee of three independent directors to evaluate the controversial proposal by CEO Elon Musk to take the company private. 

In a statement, Tesla said the committee is composed of Brad Buss, Robyn Denholm and Linda Johnson Rice.

There are "no assurances (that) can be given regarding the likelihood, terms and details of any proposal or potential going private transaction" being accepted or completed by the panel, it said.

Musk faced a firestorm of controversy after unleashing a string of tweets that he wants to take the company private.

READ: Tesla faces SEC probe after Elon Musk's tweetstorm about going private, says WSJ

Tesla said the special committee "has not yet received a formal proposal from Mr. Musk regarding any Going Private Transaction nor has it reached any conclusion as to the advisability or feasibility of such a transaction."

The special committee has retained Latham & Watkins LLP as its legal counsel and intends to retain an independent financial advisor to assist in its review of a formal proposal once it is received. Tesla itself has separately retained Wilson Sonsini Goodrich & Rosati as its legal counsel in this matter.

Shares of Tesla were trading at US$353.13, down 0.9%, in early dealings on Tuesday.

READ: Musk claims funding for Tesla going-private deal will be done with equity as Saudis eager to proceed

The committee will have the full power and authority from Tesla's board "to take any and all actions" on its behalf "as it deems necessary to evaluate and negotiate a potential Going Private Transaction and alternatives to any transaction proposed by Mr. Musk."

The panel expects to provide a further update concerning the process associated with Mr. Musk's proposal "as soon as practicable," the statement said.

Musk believes going private will benefit the company's stockholders. Aside from heading the carmaker, Musk is also chief of SpaceX, a developer of space craft to lower transportation costs into near Earth orbit and the eventual colonization of Mars.

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Tue, 14 Aug 2018 10:12:00 -0400 https://ca.proactiveinvestors.com/companies/news/202870/tesla-board-forms-special-committee-to-study-taking-company-private-202870.html
<![CDATA[News - Musk claims funding for Tesla going-private deal will be done with equity as Saudis eager to proceed ]]> https://ca.proactiveinvestors.com/companies/news/202775/musk-claims-funding-for-tesla-going-private-deal-will-be-done-with-equity-as-saudis-eager-to-proceed-202775.html Tesla Inc (NASDAQ:TSLA) CEO Elon Musk said Monday that taking the electric-car company private will be done with equity and that a Saudi wealth fund that backs the move is eager to proceed.

In a blog posted on Tesla's corporate website, Musk wrote that "most of the capital required for going private would be funded by equity rather than debt, meaning that this would not be like a standard leveraged buyout structure commonly used when companies are taken private." He added that he does not think it would be "wise to burden Tesla with significantly increased debt."

The Tesla chief sparked a firestorm last week after releasing a string of tweets about taking the company private. (To read Musk's statement, click here.)

READ: Tesla faces SEC probe after Elon Musk's tweetstorm about going private, says WSJ

Musk said the Saudi sovereign wealth fund approached him several times about making the move after it had acquired 5% of Tesla stock.

During a meeting on July 31, he said the managing director of the fund "expressed regret that I had not moved forward previously on a going private transaction with them, and he strongly expressed his support for funding a going private transaction for Tesla at this time. I understood from him that no other decision makers were needed and that they were eager to proceed."

Musk and Tesla face two complaints filed in federal court in San Francisco last week that he misled investors to bolster the company's stock.

READ: Tesla CEO Elon Musk takes Wall Street on a wild ride, considers taking electric automaker private

Musk claims that reports that it would take more than US$70bn to take Tesla private "dramatically overstate the actual capital raise needed" since the process would be accomplished through equity and not debt.

He added that the US$420 per share buyout price "would be used for Tesla shareholders who do not remain with our company if it is private."

"My best estimate right now is that approximately two-thirds of shares owned by all current investors would roll over into a private Tesla," he wrote.

Tesla was founded in 2003 and is based in Palo Alto, California. It manufactures electric vehicles that use lithium-ion batteries to power its cars.

Musk also heads SpaceX, which aims to lower space transportation costs to spur the colonization of the planet Mars.

Contact Rene Pastor at rene.pastor@proactiveinvestors.com

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Mon, 13 Aug 2018 10:01:00 -0400 https://ca.proactiveinvestors.com/companies/news/202775/musk-claims-funding-for-tesla-going-private-deal-will-be-done-with-equity-as-saudis-eager-to-proceed-202775.html
<![CDATA[News - Why Goldman Sachs doesn't think Tesla is the next Dell ]]> https://ca.proactiveinvestors.com/companies/news/202601/why-goldman-sachs-doesn-t-think-tesla-is-the-next-dell-202601.html Tesla Inc (NASDAQ:TSLA) CEO Elon Musk tweeted Tuesday afternoon that the electric-auto maker may soon go private, citing the pressure and short-term view of quarterly reporting as well as his distaste for short sellers. In the days following, analysts had some questions about the possibility of privatization and just how that would work for the US$60bn company.

Goldman Sachs on Wednesday analysts posed a few questions about a potential management buyout in a research note.

Valuation

Musk’s tweet proposed the price point of US$420 per share. The analyst estimated that with around 186.5 million diluted shares outstanding, the equity value comes to about US$78bn.

Add approximately US$6bn in adjusted net-debt and the enterprise value comes to US$84bn, which is nearly 24 times Goldman’s estimated EBITDA for 2020 and about 18 times the Factset consensus.

READ: Tesla CEO Elon Musk takes Wall Street on a wild ride, considers taking electric automaker private Price

Whether or not US$420 is a fair price may depend on an investor’s perspective on Tesla’s growth, according to the analysts.

Goldman’s upside scenario sees Tesla achieving mass-market volume, around 2 million to 3 million vehicles in 2025. The base case forecasts around 800,000. In the upside scenario, shares are valued at around US$411 per share.

“Of course, our base case valuation implies a much lower potential value per share for Tesla — given the slower growth rate and forecasted lower margin profile,” wrote analysts.

Structure

Following Musk’s tweet, one Twitter user expressed concern about what going private would mean for long-time investors.

Musk responded that he was hoping that all investors would remain if the company did go private, floating the idea of a special purpose fund similar to SpaceX. Shareholders can buy or sell every six months.

My hope is *all* current investors remain with Tesla even if we’re private. Would create special purpose fund enabling anyone to stay with Tesla. Already do this with Fidelity’s SpaceX investment.

— Elon Musk (@elonmusk) August 7, 2018

The analysts did forecast some potential issues with transition Tesla’s current shareholder base, stating that there may not be enough liquidity for large institutions with the current fund ownerships.

“While we take no view on the potential conversion rate of public to private shareholders, we note that incremental equity or leverage could potentially be needed to help finance an MBO,” wrote analysts.

READ: Tesla faces SEC probe after Elon Musk's tweetstorm about going private, says WSJ Dell Comparison

The possibility of privatization reminded some investors of Dell, another high-profile company to go the way of a leveraged buyout back in 2013. The computer giant’s management led a buyout for US$25bn, financed through a mix of ownership stake, cash, debt and equity.

While Musk’s proposition is somewhat similar, Goldman analysts don’t see an exact comparison. The analysts characterized Dell as a company with a more mature product and growth profile.

Goldman reiterated its Sell rating on Tesla’s shares.

Shares of the automaker were down around 2.5% to US$360.57 in Thursday morning trading.

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Thu, 09 Aug 2018 10:37:00 -0400 https://ca.proactiveinvestors.com/companies/news/202601/why-goldman-sachs-doesn-t-think-tesla-is-the-next-dell-202601.html
<![CDATA[News - Tesla faces SEC probe after Elon Musk's tweetstorm about going private, says WSJ ]]> https://ca.proactiveinvestors.com/companies/news/202526/tesla-faces-sec-probe-after-elon-musk-s-tweetstorm-about-going-private-says-wsj-202526.html Tesla Inc (NASDAQ:TSLA) will face increased scrutiny from regulators in the wake of a tweetstorm by CEO Elon Musk on Tuesday claiming the electric-car maker had funding to be taken private, according to a Wall Street Journal story.

Citing unnamed sources, the Journal reported that the Securities and Exchange Commission is examining whether Musk's claim that he had secured funding to go private was truthful, and inquired why the disclosure was made on Twitter and not in a regulatory filing.

READ: Tesla CEO Elon Musk takes Wall Street on a wild ride, considers taking electric automaker private

The stock immediately fell nearly 3% and closed at US$370.34 on news of the probe Wednesday.

The shares surged more than 12% Tuesday afternoon before being halted as Musk unleashed a series of tweets about his desire to take the company private, punctuated by complaints about short-sellers.

Earlier Wednesday, independent Tesla board members reportedly said that they had met with the Musk several times to discuss the possibility of going private.

Shares of Tesla were little-changed in after-hours trading.

--Adds details of meeting with board members--

Contact the writer: paul.curcio@proactiveinvestors.com

Follow Paul Curcio on Twitter: @GoCurcioGo

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Wed, 08 Aug 2018 16:20:00 -0400 https://ca.proactiveinvestors.com/companies/news/202526/tesla-faces-sec-probe-after-elon-musk-s-tweetstorm-about-going-private-says-wsj-202526.html
<![CDATA[News - Wall Street analysts weigh in on Tesla's potential path to privatization ]]> https://ca.proactiveinvestors.com/companies/news/202491/wall-street-analysts-weigh-in-on-tesla-s-potential-path-to-privatization-202491.html Tesla Inc (NASDAQ:TSLA) CEO Elon Musk sent shockwaves through the market Tuesday afternoon after tweeting that the electric-automaker may go private.

Slightly before the tweet, the Financial Times reported that Saudi Arabia’s sovereign wealth fund had acquired a US$2bn stake in the company. Just when investors thought that was the big story of the day, the other shoe dropped.

Shareholders could either to sell at 420 or hold shares & go private

— Elon Musk (@elonmusk) August 7, 2018

News of the possible privatization sent Tesla shares soaring before being halted on impending news.

Now, with the dust settled, analysts are weighing in on the idea of taking the US$60bn automaker private.

Baird

Baird analysts are refuting the US$420 per share price mark, saying that shares may trade above that as shorts cover and investors look for a higher price to go private.

The analysts saw Tesla’s deal with the Saudi fund as a good sign.

READ: Tesla CEO Elon Musk takes Wall Street on a wild ride, considers taking electric automaker private

“We believe TSLA’s reported decision to not issue shares for the Saudi wealth fund is positive, as It highlights the company’s belief it can fund growth through internally generated capital,” wrote analyst Ben Kallo in a research note.

The analyst reiterated an Outperform rating with a price target of US$411.

JP Morgan

While Baird analysts see the share price rising higher, JP Morgan analysts are disputing the shares’ current valuation.

Analyst Ryan Brinkman raised his price target to US$308 from US$195 on the possibility of privatization, but he maintains that Tesla shares are worth no more than US$195 per share based on fundamentals, as per a note summarized by TheFly.com.

While he’s unsure if the company will go private, he stated the tweets were “nevertheless declarative statements from the CEO of a public company which we feel should be considered seriously.”

The analyst kept an Underweight rating on the shares.

READ: Tesla may soon swing to a profit as Model 3 demand revs up UBS

UBS analysts think the privatization consideration may just be all smoke and mirrors, a “look over here” maneuver from Musk.

Analyst Colin Langan thinks the proposition is a way for the CEO to change the conversation around the company, as per a note on TheFly.com. Similar to JP Morgan analysts, Langan doesn’t think the fundamentals have changed.

The analyst reiterated his Sell rating and $195 price target.

In a blog post following the tweet, Musk pointed to the “enormous pressure” put on the company by the quarterly earnings cycle, causing the automaker to make decisions right for the quarter but not necessarily right for the long-term.

Morgan Stanley

Morgan Stanley analysts say that while they are understanding of that struggle, they wonder if the capital markets will be able to support a leveraged buyout and if Tesla can support greater financial leverage.

READ: Cost to insure Tesla's debt rises amid default fears after leaked memo: reports

While being out of the limelight may be a better option in some respects, the analysts note that the automaker has relied on the public market to fund its plans since 2010.

“Taking the company private would assume one of 2 factors changing: (1) that the company is on the verge of generating self-sustaining cash flows or (2) that the company can tap into a range of strategic sources of capital not previously at its disposal,” wrote analysts.

The analysts view the benefits of taking the company private are outweighed by the risks of added financial leverage.

Morgan Stanley reiterated an Equal Weight rating with a price target of US$291.

RBC

RBC analysts also sympathized with Musk’s sentiment on how quarterly metrics can shift focus away from long-term goals.

However, the analysts were concerned about the automaker’s ability to raise capital as a private company and whether current shareholders would stay on board. Holding onto investors may be dependent on who provides the outside funding.

“In our view, sovereign funds (broadly), cash rich tech companies, Chinese sources and large VCs could all be potential candidates to provide funding,” wrote analysts.

RBC reiterated a Sector Perform rating with a price target of US$315.

Shares of Tesla were down around 1.5% to US$374 in Wednesday afternoon trading.

--Updated to add analyst commentary and current share price

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Wed, 08 Aug 2018 09:11:00 -0400 https://ca.proactiveinvestors.com/companies/news/202491/wall-street-analysts-weigh-in-on-tesla-s-potential-path-to-privatization-202491.html
<![CDATA[News - Tesla CEO Elon Musk takes Wall Street on a wild ride, considers taking electric automaker private ]]> https://ca.proactiveinvestors.com/companies/news/202405/tesla-ceo-elon-musk-takes-wall-street-on-a-wild-ride-considers-taking-electric-automaker-private-202405.html Tesla Inc (NASDAQ:TSLA) shares went on a wild ride Tuesday afternoon, jumping after reports that Saudi Arabia’s sovereign wealth fund had acquired a US$2bn stake in the electric vehicle company and then stopping in its tracks when CEO Elon Musk tweeted that the company may soon go private.

The Saudi's Public Investment Fund bought a 3% to 5% stake in Tesla, according to a Financial Times report.

Shares of Tesla were up more than 7% to US$367.25 in Tuesday afternoon trading before trading was halted on impending news.

Tesla resumed trading at 3:45 PM EST after being halted since around 2:00 PM EST. Shares surged more than 12% to US$385.90.

On the heels of that came a tweet from CEO Elon Musk’s account, hinting that the company may soon go private.

Am considering taking Tesla private at $420. Funding secured.

— Elon Musk (@elonmusk) August 7, 2018

Tesla did not provide an official response immediately, but later shared an email it sent to employees on its blog.

“As a public company, we are subject to wild swings in our stock price that can be a major distraction for everyone working at Tesla, all of whom are shareholders,” wrote Musk.

The CEO pointed to the “enormous pressure” put on the company by the quarterly earnings cycle, causing the automaker to make decisions right for the quarter but not necessarily right for the long-term.

“Finally, as the most shorted stock in the history of the stock market, being public means that there are large numbers of people who have the incentive to attack the company,” he added.

The tweets

One Twitter user expressed concern about what going private would mean for long-time investors.

My hope is *all* current investors remain with Tesla even if we’re private. Would create special purpose fund enabling anyone to stay with Tesla. Already do this with Fidelity’s SpaceX investment.

— Elon Musk (@elonmusk) August 7, 2018

Electrek editor Fred Lambert asked the CEO via Twitter if he would maintain control over the company if it were to go private.

Musk responded, saying that he doesn’t currently have a controlling vote but would not be selling either way.

I don’t have a controlling vote now & wouldn’t expect any shareholder to have one if we go private. I won’t be selling in either scenario.

— Elon Musk (@elonmusk) August 7, 2018 Stopping short

Musk has been a long-time critic of short-sellers, lashing out via Twitter and during his infamous earnings call.

His most recent tweet cost shorts hundreds of millions of dollars.

Tesla short sellers lost around US$884 million in mark-to-market losses, according to estimates from fintech company S3 Partners shared by a CNBC report.

The total loss for Tesla’s short-sellers has been around US$2.4bn this year with 35 million shares held short.

Musk responded to another tweet confirming that there would be no forced sales and that a smooth transition would put an end to “negative propaganda from shorts.”

Def no forced sales. Hope all shareholders remain. Will be way smoother & less disruptive as a private company. Ends negative propaganda from shorts.

— Elon Musk (@elonmusk) August 7, 2018

--Updated to include recent share price and additional tweets--

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Tue, 07 Aug 2018 12:57:00 -0400 https://ca.proactiveinvestors.com/companies/news/202405/tesla-ceo-elon-musk-takes-wall-street-on-a-wild-ride-considers-taking-electric-automaker-private-202405.html
<![CDATA[News - Tesla files lawsuit against ex-employee for allegedly sharing confidential information ]]> https://ca.proactiveinvestors.com/companies/news/199259/tesla-files-lawsuit-against-ex-employee-for-allegedly-sharing-confidential-information-199259.html Tesla Inc (NASDAQ:TSLA) is suing a former employee who allegedly exported data and trade secrets to a third party, according to a Bloomberg report.

CEO Elon Musk sent an email to his employees Sunday evening claiming that he had received information about an employee “who had conducted quite extensive and damaging sabotage” to the company’s operations.

READ: Tesla CEO Elon Musk emails employees about a possible saboteur in its ranks

The former process technician at the Nevada Gigafactory had been passed over for a promotion and is said to have retaliated against the company by making direct code changes to the manufacturing operating system under false usernames, according to the email. Then, the employee allegedly exported large amounts of “highly sensitive” data to unknown third parties, including confidential photographs and video of the company’s manufacturing system.

Tesla also claims that the employee lied to the media by providing false information, including claims that punctured battery cells were being used in vehicles,

READ: Electric car maker Tesla slashes 9% of its workforce as part of what Elon Musk calls a 'difficult, but necessary' reorganization

In the email shared by CNBC, Musk warned employees to be mindful of the Wall Street "short sellers and outside forces" he believes is trying to stand in the way of Tesla reaching its production goal of 5,000 electric vehicles per week.

Musk directed employees to an email address where they could send an anonymous note about suspicious activity within the company.

The electric vehicle company filed a lawsuit in Nevada federal court.

Shares of Tesla were up more than 1% to US$356.87 in Wednesday afternoon trading.

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Wed, 20 Jun 2018 12:16:00 -0400 https://ca.proactiveinvestors.com/companies/news/199259/tesla-files-lawsuit-against-ex-employee-for-allegedly-sharing-confidential-information-199259.html