A wealth manager dings Tesla, says there’s ‘absolutely no reason’ to own the company’s shares right now (TSLA)

  • According to Mark Tepper, CEO of the wealth-management firm Strategic Wealth Partners, there's "absolutely no reason" to own Tesla stock.
  • In an interview with CNBC, Tepper cited low margins, the expiration of a federal tax credit for Tesla's US customers, and increasing competition from the likes of Volkswagen and Porsche as reasons to be wary of Tesla stock.
  • The electric-car company's share price has slid over 15% during the past 12 months and over 25% since the beginning of 2019 as the company has failed to build on the profits it earned during the second half of 2018 and by posting losses during the first half of this year.
  • Tesla's share price fell as much as 7% on Thursday morning after the company released its third-quarter delivery report after markets closed on Wednesday.
  • While Tesla's 97,000 third-quarter deliveries set a company record, it fell on the low end of Wall Street's consensus estimates, which ranged between 95,000 and 100,000 vehicles.
  • Visit Business Insider's homepage for more stories.

Tesla's stock price has fallen by more than 25% since the beginning of this year, as of Friday morning. According to Mark Tepper, CEO of the wealth-management firm Strategic Wealth Partners, there's "absolutely no reason" to own the electric-car maker's shares.

In an interview with CNBC, Tepper cited low margins, the expiration of a federal tax credit for US Tesla customers, and increasing competition from the likes of Volkswagen and Porsche as reasons to be wary of Tesla.

"What you have here is you have a company that's just, quite frankly, notorious for overpromising and underdelivering, so there's absolutely no reason to own the stock right now," he said.

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Tesla's share price fell as much as 7% on Thursday morning after the company released its third-quarter delivery report after markets closed on Wednesday. While Tesla's 97,000 third-quarter deliveries set a company record, it fell on the low end of Wall Street's consensus estimates, which ranged between 95,000 and 100,000 vehicles.

"What's happened is the narrative has switched, from one of innovation to now it's one of survival," Tepper said. "So the stock's going to get whacked every time they miss."

A Tesla representative directed Business Insider to the company's third-quarter delivery report in which it said, "As was also the case in Q2, nearly all of our Model 3 orders were received from customers who did not previously hold a reservation, solidifying the transition to generating strong organic demand. We are continuing to focus on increasing production to meet that demand."

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Tesla's stock price has slid over 15% during the past 12 months and over 25% since the beginning of 2019 as the company has failed to build on the profits it earned during the second half of last year by posting losses during the first half of this year.

The company's market capitalization of $42 billion is greater than those of Ford ($34 billion) and Fiat Chrysler ($19.1 billion), but lower than that of General Motors ($49.6 billion). At around $230, as of Friday morning, Tesla's stock price is much higher than those of all three of its American competitors.

Watch CNBC's interview here.

Are you a current or former Tesla employee? Do you have an opinion about what it's like to work there? Contact this reporter at [email protected]. You can ask for more secure methods of communication, like Signal or ProtonMail, by email or Twitter direct-message.

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