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One of Tesla's former biggest supporters on Wall Street said on Tuesday the electric carmaker's shares could fall to $10 from around $200 now, if tensions with China escalate and sap demand for its cars.
Shares of Tesla edged down, heading for their fifth straight session of losses, and bonds weakened, after Morgan Stanley analyst Adam Jonas outlined his worst case scenario.
Jonas - Shares - Price - Target - Range
Jonas forecast the shares could be worth $10 to $391, with a price target of $230, a wide range that underscores the confusion and risks about Tesla's future.
The company is facing signs of dragging demand as rivals step up electric efforts, as well as issues related to cash flow and manufacturing, its outlook in China and its eccentric, charismatic Chief Executive Officer, Elon Musk.
'Tesla - Demand - Strain - Fundamentals - Jonas
'Tesla has grown too big relative to near-term demand, putting great strain on the fundamentals,' wrote Jonas, rated a five-star analyst by Refinitiv for the accuracy of his forecasting on the company.
The company's stock, which has almost halved in value since last August, was down less than 1 per cent at $204.96 on Tuesday afternoon.
Days - Company - Prices - Model - Sedan
In the last 10 days, it has gained only once, when the company boosted prices of its Model 3 sedan last week.
It is building a factory in China to produce its Model 3 electric vehicles in the world's largest auto market and to escape a rise in tariffs on cars imported from the United States.
Brokerage - Baird - Price - Target - Company
Another brokerage, Baird, cut its price target for the company to $340 from $400, saying concerns over demand, credibility and noise around the company have kept incremental buyers out of the market.
'The departure of key executives, price discounting, and extraordinary cost-cutting efforts add to the narrative of a company facing real potential stress,' Morgan Stanley's Jonas said.
Backer - Tesla - Jonas - Price - Target
An early backer of Tesla, Jonas in 2011 set a price target...
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