Amid Tesla’s soaring stock price and Model 3 production ramp up, one Wall Street firm says that CEO Elon Musk’s idea for a vertically integrated business won’t be able to scale up as quickly and profitably as consensus thinks.
Jefferies set a 12-month share price target at 27 percent less than the value at Monday’s close, amounting to a $280 share price. The firm’s skepticism is simple: it doesn’t think that Tesla will be able to reach its lofty goals, reports CNBC.
“Achievements to-date and vision are impressive, but we don’t think Tesla’s vertically integrated business model can be scaled up as profitably and quickly as consensus thinks and valuation multiples imply,” analyst Phillip Houchois wrote in a note to clients.
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