On May 27, Beijing time, Jefferies, a famous investment bank on Wall Street, cut Tesla's target share price by 16% on Thursday, believing that the share price of this electric vehicle manufacturer has little potential to rise because of the increased governance risks surrounding CEO Elon Musk**
Jeffrey lowered Tesla's target share price from $1250 to $1050, but maintained its "buy" rating. "The long-standing concern about Tesla's internal disruption has become a reality, which has improved Tesla's risk forecast. At the same time, operational performance continues to set revolutionary new standards for return and resource efficiency." Jeffery analyst Philippe houchois said in a report to clients.
"Over the years, we have used 'internal enemies' and' Tesla is bigger than musk 'to describe the risks brought by Tesla's unconventional leadership and weak governance," hojos said. "It is difficult to put aside the factors behind the recent stock market correction, from Nasdaq to Twitter's financial commitments, but we obviously saw a series of disturbing negative news, from ratings to polarized political views and moral issues."
Hojos believes that Musk's personality shows that the decision is entirely up to him. Musk was recently involved in a sex scandal. A stewardess accused musk of revealing her privacy to her on his private plane. SpaceX reportedly paid the stewardess a $250000 (about 1.7 million yuan) sealing fee.
Tesla shares closed up more than 7% on Thursday, returning to $700. However, Tesla's share price has fallen by more than 30% so far this year.