Tesla stock closes lower than $150 for first time in more than two years as analysts say they can’t ignore Elon Musk’s Twitter ‘nightmare’ anymore

Tesla Inc. shares closed lower than $150 for the first time in more than two years Monday, after analysts said they are concerned that Chief Executive Elon Musk is being distracted from running the $484 billion electric-vehicle maker as he also runs the social-media Twitter service.

Tesla TSLA,
-0.24%
shares closed down 0.2% at $149.87. Factoring in the stock’s 3-for-1 split in August, shares closed lower than they have since Oct. 15, 2020, when they finished at a split-adjusted $149.63. The S&P 500 index SPX,
-0.90%
slipped 0.9% Monday and the tech-heavy Nasdaq Composite Index COMP,
-1.49%
declined 1.5%.

Tesla shares are down 57.5% year to date, compared with a 19.9% ​​fall on the S&P 500 and a 32.6% drop on the Nasdaq. Tesla shares suffered their worst week since 2020 last week, as a high-profile investor called on Musk to name a new Tesla CEO and Musk sold $3.6 billion in Tesla stock, his second large sale of shares in a little more than a month.

For more: Tesla stock suffers worst week since 2020 as Elon Musk sells, large shareholder asks for new CEO

Tesla shares have struggled since Musk agreed to acquire Twitter for $44 billion earlier this year, then sued to try to get out of the deal. Since officially closing the deal in October, Musk has appeared to spend much of his time focused on the social-media service, and has reportedly pulled in employees of Tesla as well as SpaceX in an attempt to turn Twitter around.

FactSet/MarketWatch

Oppenheimer analyst Colin Rusch downgraded Tesla to perform in a Monday note, citing the maelstrom at Twitter and noting he had tried to ignore it previously.

“While we continue to see Tesla evolving EV and autonomous technology in advance of peers and driving costs to levels those peers will struggle to match—and have tried to separate Elon Musk’s non-Tesla endeavors (personal and professional) from our analysis on TSLA— we believe Mr. Musk’s acquisition and subsequent management of Twitter now make that separation untenable,” Rusch said.

“The combination of Twitter’s unclear cash needs and diminishing options for Mr. Musk to serve those needs amid the broad public backlash driven by inconsistent standards application for Twitter users, notably banning select journalists, is pushing us to the sidelines,” Rusch continued.

“Time to end this nightmare as CEO of Twitter,” Wedbush analyst Dan Ives wrote in a separate Monday note, citing a poll that Musk posted on Twitter late Sunday, asking users whether he should step down as CEO.

Read: Poll shows Twitter users favor removal of Elon Musk

“From the botched verification subscription plan to banning journalists to political firestorms caused on a daily basis its been the perfect storm as advertisers have run for the hills and left Twitter squarely in the red ink potentially on track to lose roughly $4 billion per year we estimate ,” wrote Ives, who has an outperform rating on Tesla and a $250 price target.

Meanwhile, Sen. Elizabeth Warren called on Tesla’s Chair Robyn Denholm to address concerns that the board has failed to meet its legal duties in not addressing its CEO’s behavior.

Read: ‘Tesla is not Musk’s private plaything’ — Sen. Elizabeth Warren asks Tesla chair to address CEO’s conflict with Twitter

Of the 43 analysts who cover Tesla, 27 have buy-grade ratings,13 have hold ratings, and three have sell ratings, along with an average target price of $281.19.

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