Stocktake: Has the Tesla bubble burst?

Chaos caused by coronavirus outbreak is what catalysed company’s plummeting share price

 A Tesla charging station in San Ramon, California, USA. Photograph: John G Mabanglo/EPA

A Tesla charging station in San Ramon, California, USA. Photograph: John G Mabanglo/EPA

 

Tesla’s skyrocketing valuation was the subject of a number of Stocktake columns in February, the last of which cited a report warning that the bursting of the Tesla bubble was a case of “not if, but when”. As it happens, the stock peaked a day later before falling all the way down from $950 (€ 885) to $350 (€ 325).

Tesla’s valuation never made much sense to Stocktake but the chaos caused by the coronavirus outbreak is what catalysed the plummeting share price, not specific valuation concerns. General Motors, Ford, Daimler and BMW all traded on lowly valuations prior to mid-February’s market peak; that hasn’t stopped them suffering selloffs ranging from 40 to 50 per cent. It may be premature to say the Tesla bubble burst or for the bears to claim victory; you can get a trade right for the wrong reasons.

The Irish Times Logo
Commenting on The Irish Times has changed. To comment you must now be an Irish Times subscriber.
SUBSCRIBE
GO BACK
Error Image
The account details entered are not currently associated with an Irish Times subscription. Please subscribe to sign in to comment.
Comment Sign In

Forgot password?
The Irish Times Logo
Thank you
You should receive instructions for resetting your password. When you have reset your password, you can Sign In.
The Irish Times Logo
Please choose a screen name. This name will appear beside any comments you post. Your screen name should follow the standards set out in our community standards.
Screen Name Selection

Hello

Please choose a screen name. This name will appear beside any comments you post. Your screen name should follow the standards set out in our community standards.

The Irish Times Logo
Commenting on The Irish Times has changed. To comment you must now be an Irish Times subscriber.
SUBSCRIBE
Forgot Password
Please enter your email address so we can send you a link to reset your password.

Sign In

Your Comments
We reserve the right to remove any content at any time from this Community, including without limitation if it violates the Community Standards. We ask that you report content that you in good faith believe violates the above rules by clicking the Flag link next to the offending comment or by filling out this form. New comments are only accepted for 3 days from the date of publication.