Tesla’s shares slumped more than 4 per cent on Monday after Goldman Sachs downgraded the stock, citing concerns over the company’s cash needs and ability to deliver the launch of new Model 3 vehicle on time.
Goldman Sachs analyst David Tamberrino said worries over Model 3’s delayed production, along with the carmaker’s acquisition of SolarCity and expected stock sales to raise $1.7billion, led him to downgrade Tesla’s shares from “sell” to “neutral”.
“While we believe Tesla currently has a lead relative to OEM (original equipment manufacturer) peers with respect to vehicle technology adoption, electric vehicle architecture, and (potentially) battery scale, our concerns are more near-term oriented with respect to operational execution on the Model 3 launch, an unproven solar business, and cash needs,” Tamberrino wrote in a statement.
This pushed Tesla’s shares down 4.83 per cent to $244.52, cutting the company’s year-to-date gains to 15.2 per cent. Despite this, Tesla’s stock has jumped 30 per cent in the last 12 months, while the S&P 500 has gained only 22 per cent. Tesla’s shares have also gained more than 30 per cent since early December.