Tesla: share price falls after BofA downgrade

(CercleFinance.com) - On Tuesday, Tesla posted one of the steepest declines on the Nasdaq 100 index, as Bank of America lowered its recommendation on the stock from "buy" to "neutral".


About an hour after opening, the electric vehicle manufacturer's stock shed 2.6%, while the technology-weighted index lost 0.7%.

In its research note, BofA considers that the current valuation of Elon Musk's group incorporates many of the long-term catalysts, starting with the 'robotaxi' project, which represents, according to the US bank's calculations, around 50% of the company's capitalization.

Beyond the 'robotaxi' - which is expected to be launched in mid-2025 - the New York firm indicates that prospects linked to autonomous driving (FSD) represent 28% of the company's valuation.

On the positive side, BofA recognizes that the launch of a new entry-level model in early 2025, followed by another at the end of 2025, could be a positive factor, as could the completion of a potential capital increase, since raising funds would help accelerate growth.

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