Tesla CEO Elon Musk Admits Tesla Stocks Are ‘Higher Than We Deserve’
The company’s market value is up big in 2017.
Tesla growth in 2017 has been trial-by-fire. The Silicon Valley automaker's expansion in comparison to last year has done mostly well, but as some speculators point out, its market value hasn't been thoroughly proven, and one of those critics is an unlikely one—Tesla CEO and founder Elon Musk. He has said in the past that he doesn't understand why his company's eval was so high, and according to Musk via a report from CNBC, it's currently "higher than [Tesla] deserves."
When contrasting Tesla stock in 2016 to today, overall figures show an increase of nearly 50 percent. The company had been building steam after its announcement of projects like the Gigafactory, Tesla solar tech, and especially the high-volume Model 3 production, all of which have contributed to a strong position at this year's halfway point. But due to a string of troubles, shares plummeted by 22.5 percent at the beginning of July, and Tesla is still up nearly 46 percent this calendar year—now we start to see where Musk is coming from.
The brand chief acknowledged that these struggles were imminent. Competition from other big, established manufacturers is finally starting to pick up, and development costs for a new, affordable car surely make a major difference to where the company stands financially.
Additionally, a recent crash that was blamed on Tesla's Autopilot system caught headlines and drove stocks down as well. Though the driver involved has since denounced these claims and put the fault on him, stock buyers are still wary of the company's standings in the situation.
Investors like Bernstein, KeyBanc Capital, Cowen, and Goldman Sachs all took note of this slump and made Musk aware of their discontent. Goldman analyst David Tamberrino pointed out that Musk and his company failed to follow through with its delivery target of 23,500 units, making for a shortcoming that only totaled about 22,000.
Regardless of that downturn, Tesla stocks have climbed three percent since. The third quarter of this year will be telling for the EV manufacturer, and if the Model 3 takes off without a hitch, fingers crossed, then Tesla could finally start to earn its high market evaluation.
Until then, Musk will still stand in limbo of balancing his company's development, and keeping Wall Street happy; neither of which are easy tasks.
