Tesla: Overvalued Without The Dream Segments (Rating Downgrade) (NASDAQ:TSLA)

Downgrade From Outperform to Neutral

Morgan Stanley has downgraded Tesla from Outperform to Neutral. Tesla's stock price has been on a downward trend since November 2021 and has lost over 50% of its value. The downgrade by Morgan Stanley is based on the view that Tesla's valuation is too high and that the company's growth prospects are not as strong as they once were.

Tesla's Valuation

Tesla is currently valued at over $700 billion. It is the most valuable automaker in the world, even though it produces far fewer cars than traditional automakers like Toyota and Volkswagen. Tesla's valuation is based on the expectation that the company will continue to grow rapidly in the future. However, Morgan Stanley believes that this growth is not sustainable and that Tesla's valuation is too high.

Tesla's Growth Prospects

Tesla has been growing rapidly in recent years. The company delivered over 900,000 vehicles in 2021, up from 500,000 in 2020. However, Morgan Stanley believes that this growth is not sustainable and that Tesla will face increasing competition from traditional automakers in the years to come. Tesla is also facing challenges in its other businesses, such as solar energy and energy storage.

Conclusion

Morgan Stanley's downgrade of Tesla from Outperform to Neutral is based on the view that Tesla's valuation is too high and that the company's growth prospects are not as strong as they once were. Tesla's stock price has been on a downward trend since November 2021 and has lost over 50% of its value. It is unclear whether Tesla's stock price will recover in the near term.