Tesla (NASDAQ:TSLA) stock has experienced a significant surge in recent months, following the upward trend of the NASDAQ due to speculation that the Fed's rate hike cycle would come to a halt. Additionally, the announcement of new models also contributed to the increase in stock value.
However, despite these positive developments, the company's market multiples remain high, and it faces stiff competition in the market. In my assessment, the stock's true value is around $85.
As interest rates continue to rise, tech companies like Tesla may face a major setback as their borrowing costs increase. The recent abandonment of plans to expand the Shanghai factory and the recall of 360,000 vehicles due to software issues involving autopilot are further causes for concern.
Investigations into the matter are ongoing, and the resulting decline in turnover and profitability has prompted the management to reduce productivity.
From a technical point of view, on 16 February, the stock suffered a sharp drop accompanied by an increase in trading volumes (+34.49%), giving a good signal of the strength of the bearish movement.
The bullish situation remains unchanged in the medium term, while the secondary trend is visibly losing strength.
Further confirmation of the medium-term positivity is given by the close above the slow moving average, but we must pay attention to the value of the Average of 196, which if violated could give rise to a downward trend.
In summary, these are the points that do not convince me of Tesla:
- The valuation of the group in terms of earnings multiples appears relatively high.
- Based on current prices, the company is highly valued in terms of enterprise value.
- Turnover expectations for the last 12 months have been largely revised downwards.
Disclosure on my positions:
I have a position in Natural Gas with an average purchase price of 3.4, a buy position in VIX and a US stock Aytu Biopharma. I'm suffering on gas, but I knew that with 'hot' weather, prices could go to area 2.5 as in 2020. I'm ready to buy a share in the gas sector with great potential plus further VIX contracts which could lead to a price rally at any moment as the markets collapse. My targets are very ambitious and are often confirmed.