Wedbush researcher Dan Ives recently weighed in on the Tesla Inc. downgrade, highlighting a distinct aura of pessimism in the market. Ives astutely observed that even New York City cab drivers are expressing negative sentiment towards Tesla. However, he remains optimistic about the company’s future, particularly with the advancements in AI technology.
Understanding the Situation: Despite the current wave of bearish sentiment, Ives maintains a positive long-term outlook for the electric vehicle (EV) powerhouse, Tesla. He views the current negative sentiment as a potential opportunity for investors to acquire Tesla shares before an anticipated resurgence in the company’s value.
In an interview with CNBC, Ives remarked, “In six to nine months, we could look back on this as an ideal moment to invest in Tesla for the coming two to three years, particularly with the developments in AI technology. However, for now, even the perception among New York City cab drivers is pessimistic about Tesla.”
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Significance of the Situation: Tesla’s stock recently faced challenges after Wells Fargo downgraded the company from Equal Weight to Underweight and significantly lowered the price target. The downgrade was primarily influenced by concerns over disappointing deliveries, potential negative earnings adjustments, and a perceived decline in Tesla’s luxury brand appeal following price reductions.
Nevertheless, Ives has consistently emphasized Tesla’s AI and Full Self-Driving (FSD) technology’s potential to drive the company’s market value beyond $1 trillion. He pointed out that the risk/reward ratio at current levels is highly favorable, with Tesla’s AI and FSD technologies making substantial progress. Ives stressed that it is not the appropriate time to abandon faith in Tesla.
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