‘When a stock becomes unmoored from valuation because it has certain dynamic growth aspects to it, and has cult-like aspects to it, you have to just walk away’
The incredible six-day, 60 per cent rally in Tesla Inc. that left Wall Street watchers scratching their heads screeched to a halt Wednesday.
Tesla shares have “had a Bitcoin-like move and profits are being taken off the table with technical levels being hit,” Wedbush analyst Daniel Ives said. The analyst expects the stock to settle in the US$700 range and start moving higher again on the potential of its China business, despite coronavirus fears.
That sentiment may have finally caught up with the stock, starting with the jaw-dropping US$109 drop in the price right before the closing bell on Tuesday. The stock closed at US$887.06, bringing its 2020 gains to 112 per cent. Wednesday’s selloff would pare that back to an year-to-date gain of 73 per cent.
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