Tesla (TSLA) shares are getting run over right out of the gate post-holiday weekend.
The stock is down 7% premarket as president Trump and Elon Musk return to public battle. The general vibe from those I have chatted with is that Musk creating his own political party is the last thing Tesla shareholders want to see. Where is the board of directors here to get this guy under control?
However, lost in the sauce today is that the new tax and spending bill signed into law by Trump ends the EV tax credit on Sept. 30. That’s further bad news for Tesla, argues William Blair analyst Jed Dorsheimer.
“The elimination of the corporate average fuel economy (CAFE) fines requires a reset in expectations,” Dorsheimer wrote. “While the $7,500 tax credit is likely to affect demand, the combination of a demand headwind and over $2 billion in profit from regulatory credits at risk may be too much for investors to bear. Unlike the EV tax credit, we expect the reduction in regulatory credit revenue to result in a direct hit to profitability, prompting yet another across-the-board reset to Street models.”
Tesla is our “stock of the day” on Yahoo Finance’s Opening Bid this morning. Tune in around 9:40 am ET here to get some fire analysis!