This article is brought to you by a Russian Telegram channel "Antihype on money," an analytical channel about all economic hype trends and their triggers.
What happened: Tesla shares doubled in price over the past three months, breaking the mark of $500 per share. The reason for the new rally on Monday was the forecast of the Oppenheimer fund analyst to raise the target level for stocks above $600. From the big perspective, the latest rally was supported by the generally favorable market conditions and news about permission to build a new Tesla factory in China.
What really happened: The rally is based on strong expectations that the company is able to consistently generate positive cash flow. Meanwhile, Tesla is still facing regular problems. Having the highest market capitalization among American automakers, overtaking Ford and GM, the company is still far from regularly generating profit for investors. This makes its shares vulnerable to correction at the moment when the attention of investors switches from growing to profitable companies.
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