Tesla's stock under alleged active manipulation, claims Wall Street analyst
In an X post on August 29, Wall Street analyst Gordon Johnson raised concerns about the stability of Tesla's (TSLA) stock price. Johnson, who is bearish on the electric vehicle manufacturer, suggested that the stock's resilience, despite mounting challenges and abysmal news, may be due to artificial support from the options market.
Johnson pointed to Tesla's stock price, which has remained mainly above the $300 level throughout the year, as evidence of this manipulation. He contends that the pattern of aggressive call buying, which has kept the put-to-call ratio below 1.0, is 'engineered support' for Tesla's stock rather than price action justified by earnings or operational performance.
This assertion was further supported by the collapse of the put-to-call ratio from 0.85x on August 28 to 0.67x on August 29, indicating a shift in sentiment driven by options traders. Tesla's open interest ratio has also remained below 1.0 throughout the year, indicating a persistent tilt toward call buying over puts.
Tesla's second-quarter performance showed concerns, with deliveries dropping 13.5% year-over-year to 384,122 vehicles and profits plunging 71%. Despite these setbacks, the stock remained flat, according to Johnson.
The debate over Tesla's equity outlook is far from settled among analysts. While GLJ Research reaffirmed its 'Sell' rating and a bearish target of $19.05, Morgan Stanley reiterated a 'Buy' rating and projected $410 per share. Andrew Slimmon, Morgan Stanley's analyst, expects stocks to rise as corporate earnings continue to surprise, but the optimism for Tesla remains uncertain.
The controversy surrounding Tesla's stock price extends beyond its home market. In Europe, Tesla's sales declined 40% year-over-year in July, marking seven consecutive months of market share losses to rivals, including China's BYD.
However, it's important to note that there are no specific details available about particular options traders who have heavily influenced Tesla's stock price in recent months or about analysis firms providing differing perspectives on Tesla's stock.
As of the last session, TSLA shares ended down 3.5% at $333, and year-to-date, the stock has fallen more than 11%. The ongoing debate about the artificial support of Tesla's stock price and its long-term outlook continues to captivate the investment community.
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