Tesla is trading at 2-year lows, more than -50% from all-time highs we saw not long ago. The Tesla narrative has been imploding over past months. Cheap or expensive is hard to tell, but this news driven name has been brutally beaten. The 250/350 range was taken out a few weeks ago and the trajectory lower has resumed.
Tesla’s short interest ratio is 3.5, ROI -2.60%, ROE -21.60%, and the stock’s favorite color as of late is red.
It is easy to get overly bearish on this once high-flying name. Fundamentals are not great, and the Musk headline risk remains elevated. Recent trade war rhetoric is not helping the Tesla bull case but note the fact Tesla has reached some big support levels starting here. The stock is oversold, hated and most bulls have abandoned ship.
We will leave the longer-term fundamentals to Mr Chanos & Co, but at current prices Tesla is providing an interesting contrarian bounce trad set up.
Source, Charts by Bloomberg