"The Result of Speculative Desire" JP Morgan Slightly Raises Tesla Target Price but Warns of Crash

Exceptionally Harsh Evaluations Since 2015
Warnings Despite Purchases Related to S&P500 Inclusion

[Asia Economy New York=Correspondent Baek Jong-min] Investment bank JP Morgan has once again cast a curse on electric vehicle maker Tesla, which had been soaring ahead of its inclusion in the S&P 500 index. JP Morgan raised Tesla's target price only slightly while projecting a drop of more than 86%.

On the 9th (local time), JP Morgan analyst Ryan Brinkman set Tesla's 12-month target price at $90. This is a 12.5% increase from the previous target price of $80. Compared to the closing price on the 8th ($649.88), this is 86% lower.

Tesla's electric car Model 3 stands in front of the space exploration rocket that SpaceX is scheduled to test launch. The rocket launched that day exploded during landing after reaching the target test altitude. Both companies are managed by Elon Musk.
[Image source=Reuters Yonhap News]

JP Morgan has maintained a sell rating on Tesla since 2015. While Tesla's stock price has risen more than 1500% from when it was $40, JP Morgan's target price has only increased by 150%. This indicates that the target price adjustments have been extremely conservative compared to the stock price rise.

Analyst Brinkman said, "Tesla's stock price is dramatically overvalued by all traditional metrics," and advised investors looking to buy Tesla shares ahead of its inclusion in the S&P 500 index to wait until the stock price falls.

JP Morgan analyzed that Tesla's stock price has risen more than 800% over the past two years, driven by speculative enthusiasm from investors unrelated to Tesla's fundamentals. They also expressed concern over Tesla's plan to raise $5 billion through a capital increase.

Investment magazine Barron's explained that JP Morgan's target price for Tesla is the lowest in the industry. Wedbush Securities, in contrast, raised Tesla's target price to $1000 last month.

On the day, Tesla's stock price fell 6.9%, closing at $604.48. During the day, it surged to $654 but selling pressure increased in the afternoon, widening the decline.

This content was produced with the assistance of AI translation services.