“Concerns Over Fixing Negative Feedback Loop On and Off Twitter”
Prolonged negative sentiment affects vehicle sales, etc.
Oppenheimer downgraded to “average-market yield,” saying Elon Musk’s Twitter turmoil was hurting investor sentiment in Tesla (TSLA). He has removed his previous price target ($436) for the day and has not offered a new price target.
According to CNBC on the 19th (local time), Oppenheimer downgraded its investment grade rating, saying it could no longer separate Tesla from Musk’s controversial Twitter management.
“We have tried to isolate Elon Musk’s involvement in other activities from our analysis of Tesla, but it is no longer possible,” company analyst Colin Rush wrote in a memo that day.
“Inconsistent standards for Twitter, how much additional money will be poured into Twitter amid widespread public backlash following the arbitrary closure of journalist accounts and Musk’s reduced options on him are driving investors away from Tesla,” he wrote.
Tesla shares are down 57% this year. However, he said prolonged negative headlines and negative sentiment on Twitter could create a “negative feedback loop” that could hurt Tesla vehicle sales and limit its financial performance.
Tesla shares rose 4% in pre-opening trading after Musk tweeted that he would follow the results of a poll asking Twitter users if he should step down as Twitter CEO.
As of 8:20 a.m. Eastern Time, a total of 17.5 million people participated in the vote, with 57% of opinions wanting Musk to step down as Twitter CEO.
Guest reporter Kim Jung-ah kja@hankyung.com
