Tesla Institutional Investors See This As Major Reason Behind Stock's Underperformance, Morgan Stanley Survey Reveals

Tesla Institutional Investors See This As Major Reason Behind Stock's Underperformance, Morgan Stanley Survey Reveals

The Tesla Inc. TSLA stock is currently trading way off its all-time high of $414.50 reached on Nov. 4, 2021.

Musk’s Twitter Buy Main Culprit? About three-fourths of the institutional investors surveyed by Morgan Stanley blamed the Twitter situation for at least a significant portion of the recent underperformance of Tesla’s stock, analyst Adam Jonas said in a note.

About 40% of the respondents believe the Twitter situation has accounted for half or more than half of the recent weakness and about 65% feel the Twitter acquisition will have a negative or slightly negative impact on Tesla’s business going forward, the analyst said.

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Only around 5% expect the acquisition to have a positive impact on Tesla’s business going forward and 30% expect the deal to be neutral for the electric vehicle maker.

The situation at Twitter potentially exposes Tesla to risks in areas such as consumer sentiment or demand, commercial partnerships, government relations or support and capital markets support, Jonas said.

Bullish On Tesla: Notwithstanding the Twitter overhang, the analyst said he remains bullish on Tesla, as it is the only name he covers that generates a profit, before incentives.

The current stock price offers an 80% potential upside to Morgan Stanley’s price target, he added.

Jonas has an Outperform rating and $180 price target for Tesla shares.

Price Action: Tesla closed Monday’s session up 0.03% at $182.92, according to Benzinga Pro data.

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