Tesla CEO Elon Musk is being counseled to redirect his attention to Twitter and SpaceX and stay away from Twitter’s “money pit” by an analyst who previously had the highest price target on Wall Street for the company’s shares.
Wedbush analyst Dan Ives advised Elon Musk to put his attention back on Tesla and SpaceX rather than the Twitter “money hole,” which will “become a lot worse before it gets better.”
Ives has always been an optimistic analyst for Tesla, and although he restated his $250 price target and kept his ‘Outperform’ rating, which he has had for a while, he is worried about Elon Musk’s present priorities.
In his most recent endeavor, Twitter, which he purchased after a drawn-out $44 billion drama, Musk has been laser-focused on regaining profitability.
Ives has begun to indicate that he is worried about what the Twitter fiasco will do to Tesla and SpaceX, even if it is simply one more thing on Musk’s extensive list of obligations.
Twitter at this point is essentially a money pit. Best thing for Musk now is to have others with social media backgrounds focus on Twitter; lay out a strategy to monetize and keep advertisers-which is difficult until they know the ground rules. Then Musk focus on Tesla and SpaceX pic.twitter.com/gJXqlow1np
— Dan Ives (@DivesTech) November 11, 2022
Ives remarked on CNBC Overtime last night that “we’re beginning to get into brand challenges here for Tesla because of this black eye from Elon Musk and the train disaster scenario with Twitter.” “In essence, I believe Twitter to be a money hole.”
Yesterday, Ives withdrew Tesla stock from Wedbush’s list of “Best Ideas.” He reaffirmed that Tesla’s long-term thesis is still much the same, but from the standpoint of the brand, he is worried by the stock’s short-term volatility. Ives referred to a decline in demand as a “ominous” omen for the future.
This morning, Ives reaffirmed it and counseled Musk to switch his attention back to Tesla and SpaceX. The best course of action for Musk right now, according to Ives, is to have people with experience in social media concentrate on Twitter and develop a plan to monetize and retain sponsors.
Ives and Wedbush have maintained their long-standing optimistic stance on Tesla. Ives had the highest price objective for the company on Wall Street. At the time, Ives had a $1,400 price objective on the stock.