What's Going On With Tesla Shares Getting Hammered Today?

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Tesla Inc TSLA shares are trading lower by 4.61% to $700.89 after Deutsche Bank maintained a Buy rating on the stock but cut its price target from $1,250 to $1,125.

The firm reportedly reduced its Q2 deliveries estimate by 65,000 to 245,000 units (up 22% year-over-year, down 21% quarter-over-quarter), reflecting a prolonged Covid-19-related shutdown and logistical challenges in the Shanghai factory.

The firm also reportedly lowered its Q2 revenue estimate to $15.50 billion from $19.20 billion, and automotive gross margin to 26.4% from 28.7%, which resulted in its new EPS estimate of $1.66, down from $2.71 prior (vs. Street's $2.04).

Tesla is also trading lower amid overall market weakness as well as consumer confidence concerns.

Shares of growth stocks have been volatile in the month of June amid an overall market selloff partially generated by worse-than-expected U.S. May inflation data. The all items index CPI datapoint increased 8.6 percent for the 12 months ending May, the largest 12-month increase since the period ending December 1981.

Inflation concerns have weighed on the economic outlook and have also raised expectations for further Fed rate hikes. A rise in treasury yields has also weighed on tech and growth stock valuations.

The rise in U.S. Treasury yields hinders growth companies such that, when interest rates rise, the value of future cash flows is reduced for growth stocks, which in turn lower the value of the stock.

See Also: Why Endo International Stock Is Soaring Today

According to data from Benzinga Pro, Tesla has a 52-week high of $1,243.49 and a 52-week low of $620.46.

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