Tuesday Update: The Most Hated Stock In The World


Tesla (TSLA) 

This morning the financial news was all abuzz about a $10 price target placed on TSLA (trading at $200) from an analyst at Morgan Stanley, "one the most rational of analysts that are out there." 

Tesla shares could drop to $10 in a worst-case scenario, Morgan Stanley says

Read a little further in the article, "However, Jonas kept his main price target for the stock at $230 and also has a bull-case forecast of $391.

So this analyst has a range on TSLA of between $10 - $391. And why "$391" - where did that extra $1 come from when $390 makes the point? Maybe that's why he is considered the most rational analyst, since a target of $390 would clearly be irrational. 

This most hated stock on Wall Street got bought in my custodial accounts today, added to what I have been accumulating for the past couple of years. Why now? Because of this:

Tesla’s $218M acquisition of ultracapacitor firm opens doors to energy breakthroughs

and this: 

Maxwell Could Be Worth Billions to Tesla  

In summary, Tesla has taken its global lead in electric battery technologies and ratcheted it up 10X. There is no auto manufacturer even close to Tesla in this number one most important component of electric transportation. But "the most rational of analysts out there," apparently doesn't think this battery technology is of any value, or, is at best worth $10 a share. 

There isn't anything bullish about this YTD chart, but check out the 5 minute directly below as it reflects the stock price immediately after the $10 news came out: 



TSLA is having a real hard time staying below $200 no matter how bad the news. Against all of my trend following instincts, I am adding to my long term TSLA holdings here. Call me the most "irrational" of analysts out there.