Seeing is believing, the old saying goes, and expectations were sky-high for Tesla’s (NASDAQ:TSLA) We, Robot’ event last week. However, despite the high hopes, Tesla stock has continued its downward trend in 2024 – a particularly painful development given the broad market gains during the same period.
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Pushed back from its initial date of August 8th to October 10th, investors were hoping to see signs of major advances in TSLA’s cybercab and its full self-driving (FSD) technology.
As expected, Elon Musk revealed the much-anticipated Cybercab, set to debut before 2027 with a price tag of $30,000. He also showcased a prototype of the Robovan, a vehicle designed to transport up to 20 passengers in urban settings – although the timeline and pricing were not detailed. In addition, a group of Optimus robots performed a dance for the spectators.
Despite the hoopla, investor James Foord was not thrilled with the 30-minute presentation.
“Tesla’s Robotaxi event was underwhelming, with no verifiable evidence that timelines for FSD or new products are achievable,” Foord opined.
While seeing the company vision is one thing, Foord (and others) were looking for “verifiable evidence” that Tesla will be able to meet its stated goals. In addition, the investor did not see any proof that the company had been able to make significant advances with FSD over the past few months.
“We need to see an actual product hit the market, and the latest deadlines have to be met. Not doing so will be incredibly detrimental to investor confidence,” the investor added.
Still, Foord is not quite ready to give up on Tesla just yet, and points to a number of strategic advantages working in the company’s favor.
“For starters, FSD has driven way more miles than any of its competitors,” Foord noted, adding, “I do believe the technology is there.”
Another major feather in Tesla’s cap is its “vertically integrated supply chain,” which gives the company the capacity to scale up fast. The investor also cites Tesla’s spare inventory and the current crop of Teslas that could quickly augment a robotaxi fleet.
The investor’s patience has a limit, however. “I am giving Tesla one more year to produce something tangible, or I will be out of the stock,” writes Foord, who is downgrading Tesla to a Neutral rating. (To watch Foord’s track record, click here)
Foord isn’t alone in his disappointment. Wall Street’s sentiment toward Tesla shares seems lukewarm, with 11 Buy, 16 Hold, and 8 Sell ratings, making the stock a consensus Hold (i.e. Neutral). With a 12-month average price target of $207.83, the stock is expected to decline by ~5%. (See TSLA stock forecast)
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Disclaimer: The opinions expressed in this article are solely those of the featured investor. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
