on the crypto
Wall Street analysts have expressed their fears over the rapid growth of Tesla stock (TSLA), but the company's strategy may help support this increase.
A record history
The massive rush at Tesla shares Inc (NASDAQ: TSLA) is starting to confuse Wall Street analysts who fear that the actions are not supported by a framework that could support this growth and could really be overstated.
TSLA traded for only $ 211 a year ago and the share price recently reached a record high of $ 1,779,99. Tesla's surprising volatility comes in the wake of the coronavirus pandemic that has hit the whole world. Tesla currently has a record market capitalization of $ 300 billion.
Reasons for the recent TSLA bull race
The latest price hike for Tesla stock comes after Elon Musk's recent announcement of the Model Y crossover and his further drop in prices. In addition, Elon Musk also announced that the RWD Standard Range will no longer be available.
However, in replacement, the company announced a new 230-mile variant. Musk added that the company will focus more on the long-range RWD version with a range of over 300 miles per charge. Vehicle sales / deliveries in the second quarter, with the COVID-19 pandemic raging, also suggested positive company resilience to investors.
With a record 90.650 deliveries, investors believe Tesla is on track to deliver up to 750.000 units of vehicles by 2021. These expectations from the company are the reasons for the new hype that the stock will be listed on the index. S&P 500. This series of positive outlook for the media contributed to the skyrocketing growth of TSLA stock.
Expert concerns about Tesla's title
Analysts believe that if Tesla's (TSLA) stock is truly overvalued, this could have a negative effect on its profitability if it were to hit the S&P 500. Larry McDonald, editor of The Bear Traps Report, spoke on the matter saying that “by buying [stocks ] Tesla now, front-runners are forcing the S&P indices to give the stock an ever-higher weighting, so ETFs / indexes will be forced to pay, buying even more shares.
In this way hot money comes out which will leave the indices that hold the stock market "and this will lead to a potential drop in the share price. The company's position on this service is also a reason for catching customers because, according to Tesla's philosophy, the company does not profit from the service.
The takings are used to enhance the company's owned service centers and inspections and repairs by mobile technicians. In 2016, Tesla claimed to have its cars inspected every 12.500 miles or once a year, whichever comes first. These strategies are expected to help Tesla (TSLA) support its meteoric rise in stock prices.
