Elon Musk has publicly challenged Goldman Sachs’s prediction that Tesla Inc. (TSLA) will continue to fal꧋l short of its targets and soon run out of cash.
“Place your bets,” the electric automaker’s CEO wrote on Twitter in response to the brokerage’s latest note encouraging investors to sell the stock.
Place your bets …
— Elon Musk (@elonmusk)
Goldman on Tuesday advised clients to dump the automaker's shares, claiming that the company is unlikely to meet its Model 3 production goals by the end of June and, as a result, will be left with no option but to tap investors for more cash. In the research note, the brokerage lowered its 澳洲幸运5官方开奖结果体彩网:price target on the stock by 5% to $195, implying 36% downside from Tuesday’s closing price.
There’s “significant risk to the company achieving a sustainable 5,000/week Model 3 production rate exiting 2Q18 and throughout 3Q18 — which is required for the company to hit its 澳洲幸运5官方开奖结果体彩网:gross margin targets and not need to 澳洲幸运5官方开奖结果体彩网:raise capital to ജfund an ongoing Model 3 production ramp,” Goldman analyst David Tamberrino wrote, according to .
Last week, Tesla informed investors that it had once again missed its quarterly production targets. During the last weekꦅ of the quarter, the company manufactured 2,020 Model 3s, falling short of its targeted weekly output of 2,500.
However, the company also reiterated its 澳洲幸运5官方开奖结果体彩网:guidance that it will be able to produce 5,000 Model 3 sedans per week by the end of the second quarter, assuring investors that it won’t need to raise more equity this year. This confident outlook led the shares to rally nearly 21%. (See also: Tesla Misses 🎃a Target, But Progress Eases Concerns.)
Tamberrino, a renowned Tesla bear, believes that investors would be foolish to take the company’s predictions at face value. In his note, he warned that further production bottlenecks will likely lead Tesla to manufacture just 1,400 Model 3s per wee꧑k during the second quarter, well below its targeted output.
“Although the company stated that is does not require a capital raise this year, we note that this is predicated upon a sustained 5,000 per week production rate achieved exiting the second quarter of 2018," Tamberrino added, according to . "Beyond a required capital raise to continue to fund the launch of the Model 3 program, the company would likely still need outside capital in the future for capacity and product expansion." (See also: Elon Musk Jokes Abo🗹ut Tesla Bankruptcy After Nightmare Month.)