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Tesla’s Cyber Truck And Its Effect On The Stock

Jordan Baird

Jordan Baird is the head ASR Wealth Advisers client services desk and has been with the organisation since 2017. He first started investing in his early years. While he believes that investors should leave no stone unturned he has a particular interest in trading based on broad macroeconomic trends along with specific analysis of innovative up-and-coming companies.

Tesla (NASDAQ: TSLA) fell over 6% on Friday, after unveiled its ‘Cyber Truck’. Despite the truck’s impressive features, including an all-electric battery, with range of 500 miles and a 0-60 mph time of as low as 2.9 seconds, the stainless steel, futuristic aesthetic clearly proved too much for most, with the car being labelled a niche product at best.

Tesla Cyber Truck
Tesla (NASDAQ: TSLA) shares fell over 6% on Friday, after the reveal of its ‘Cyber Truck’, with investors pointing to its niche exterior design. However, the shares rebounded after Tesla CEO Elon Musk announced 200,000 pre-orders in the first 48 hours. (Credit: Business Insider).

As a result, investors do not expect the truck to sell at Detroit pickup volumes, and the share price reflects this expectation. Furthermore, the launch did no marketing wonders with the “armored glass” windows accidentally shattered during a demonstration of its strength.

Over the weekend, Tesla’s CEO and co-founder Elon Musk tweeted that the pre-orders had reached 200,000 as of Sunday. Consequently, Tesla (NASDAQ: TSLA) shares rebounded, traded up as much as 5% early Monday. The pre-order numbers rival that of the Model 3 (released three years ago), which received 325,000 orders in the first week. However, analysts are pointing to the pre-order booking fee as a potential reason for the truck’s early success, which is only US$100 for the ‘Cyber Truck’, compared to US$1,000 for the Model 3.

The share price fall represents only a small dip in an overwhelmingly positive financial year so far, with the stock up over 56% already. Tesla Inc (NASDAQ: TSLA) is now trading at $336.34 per share and has a market capitalization of over $60b.

 


 

Disclaimer:

This article has been prepared by the Australian Stock Report Pty Ltd (AFSL: 301 682. ABN: 94 106 863 978)

(“ASR”). ASR is part of Amalgamated Australian Investment Group Limited (AAIG) (ABN: 81 140 208 288 Level 13, 130 Pitt Street, Sydney NSW 2000).

This article is provided for informational purpose only and does not purport to contain all matters relevant to any particular investment or financial instrument. Any market commentary in this communication is not intended to constitute “research” as defined by applicable regulations. Whilst information published on or accessed via this website is believed to be reliable, as far as permitted by law we make no representations as to its ongoing availability, accuracy or completeness. Any quotes or prices used herein are current at the time of preparation. This document and its contents are proprietary information and products of our firm and may not be reproduced or otherwise disseminated in whole or in part without our written consent unless required to by judicial or administrative proceeding. The ultimate decision to proceed with any transaction rests solely with you. We are not acting as your advisor in relation to any information contained herein. Any projections are estimates only and may not be realised in the future.

ASR has no position in any of the stocks mentioned.

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