Morgan Stanley's Equity Research Clickbait "Tesla Stock Could Go Up 10x…Or Get Cut In Half"

Thursday was a gift from the blogger gods for anyone slaving away at $25/post plus traffic-related bonuses. Rather than having to cook up clickbait headlines on Tesla, the equity research arm of Morgan Stanley did it for them.

In a video released to the public, MS made the typical hyperbolic case about Tesla, which mostly focuses on how cool Elon Musk is and how much they’d like to sit at his lunch table in the cafeteria. The voiceover asserts that Tesla is the only company they cover that could see its stock rise ten times…but, they caution, it could also be cut in half.

Well, which one is it? MS should know, given that they helped underwrite Tesla’s IPO, and one of their debt offerings, and have written countless notes breathlessly praising the company.

I am not a CFA charterholder and the following is not intended as investment advice. But I do know that this is a company that consistently over-promises and under-delivers, that markets a six-figure car that doesn’t even have Lane Departure, Forward Collision Warning or any other feature that would be mandatory in a traditional auto maker’s flagship, that has yet to turn a profit despite a $25 billion market cap, that loses money on every single Model S and has no revenue stream except for a shaky ZEV credit sales scheme, the value of which will be cut from roughly $4,000 per credit to a little over $1,000 per credit by 2017. If Tesla doesn’t get their mass market Model 3 out by then, they’re in big trouble. We haven’t even seen the long promised Model X yet, so it’s not looking good. Until then, they are nothing more than taxpayer subsidized playthings for the 1 percent.

Oh, and that long awaited announcement about ending range anxiety? Turns out it was a “trip planner” that plots charging points on your GPS screen. Nissan introduced that on the Leaf half a decade ago. Somehow, Elon Musk gets a pass for being some brilliant visionary when his accomplishments so far have been 1) the greatest Svengali the automotive world has ever seen 2) inventing an online payment method that half the world seems to despise. But as long as the tech press can keep living vicariously through him, he’ll be fine.

My own call for Tesla is “sell” with a price target of $0, based on their inability to generate sustainable revenue streams, the constant delays in product development, the obfuscation of key data and concerns regarding company management. Unfortunately, even the activist investors have been swayed by the relentless hype. Where’s Bill Ackman when you need him?

Disclosure: Author holds no position in Tesla but is long the entire S&P 500 via index funds.