Market Watch: Tesla’s stock tumbles after Goldman Sachs downgrade
Shares of Tesla Motors Inc. TSLA, +2.92% slumped 3.5% in morning trade Thursday, after the electric car maker was downgraded at Goldman Sachs, which cited potential risks to Model 3 delivery timelines and free cash flow concerns. Analyst David Tamberrino cut this rating to neutral from buy, and slashed his stock price target to $185, which is 8% below current levels, from $240. The changes were part of a downgrade of the broader auto sector to cautious from neutral, citing the belief that the U.S. auto cycle peaked in 2015. For Tesla, Tamberrino said he is concerned about risks to the business related to management’s decision to deploy capital for acquisitions, such the attempt to buy SolarCity Corp.