Tesla Motors Inc
Yesterday evening, Standpoint analyst Ronnie Moas downgraded shares of Tesla Motors Inc (NASDAQ:TSLA) from Hold to Sell, with a price target of $180, following recent run up in Tesla’s share price. After the shares have been on a long bull run since February 8, the analyst believes that they are now once again over-valued.
Moas emphasized his bearish stance on Tesla, noting, “The recent move was in my opinion fueled by short covering and not by investors who see value in this name even though there were good headlines regarding the Model 3 this week. TSLA may hit $15 billion in revenue in 2018 (GM is at $150 billion), yet the market is treating the two nearly as equals when we compare the market capitalization. The market is treating TSLA as if it is Apple or Amazon – it is neither.”
The analyst continued, “It will take TSLA 5-10 years for TSLA to grow into this valuation and that will only happen if competitors watch from the sidelines – not going to happen. Moreover, “There is execution risk and possibly a capital raise required and/or a new manufacturing facility to build.”
“Most auto manufacturers are trading at 6X earnings. Even if we attach an 18X multiple to a $10 EPS 2020 estimate for TSLA looking out a few years we only come up with a $180 price target,” Moas added.
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Ronnie Moas has a yearly average return of 4.7% and a 68% success rate. Moas has a 11.4% average return when recommending TSLA, and is ranked #71 out of 3854 analysts.
Out of the 23 analysts polled by TipRanks, 11 rate Tesla Motors stock a Buy, 4 rate the stock a Hold and 8 recommend to Sell the stock. With a downside potential of nearly one percent, the stock’s consensus target price stands at $255.53.
Verizon Communications Inc.
Jefferies analyst Mike McCormack downgraded shares of Verizon Communications Inc. (NYSE:VZ) from Buy to Hold, with a price target of $53, as the stock offers limited risk/reward benefits, given the lack of near term catalysts.
McCormack explained, “Verizon shares have significantly outperformed the broader market and our price target has been achieved. Although we continue to believe Verizon is very well positioned in the industry long-term, we do not believe near-term catalysts exist to provide upside to either our estimates, or our view on valuation. In our view, management faces a few hurdles as 2016 progresses, including continued ARPA degradation, slowing subscriber gains, an uncertain path to EPS stability post the FTR property sale, an unproven video strategy, and the risk of continued “Millennial”-oriented acquisition activity. Although we see few catalysts for further share appreciation, we do not expect downside for the shares given strong cash flow, a healthy 4.2% dividend yield, and a strong position in the wireless industry.”
According to TipRanks.com, analyst Mike McCormack has a yearly average return of 16.9% and a 83% success rate. McCormack has a 7.0% average return when recommending VZ, and is ranked #31 out of 3854 analysts.
Out of the 17 analysts polled by TipRanks, 6 are bullish on Verizon’s stock, while 11 remain on the sidelines. With a return potential of nearly 2%, the stock’s consensus target price stands at $53.23.