Tesla shares gain for a second straight session on Wednesday, auto maker under scrutiny by the NHTSA due to Model 3 safety assertions

August 8, 2019 9:58 am

According to a report by Bloomberg earlier this week, last year a cease-and-desist letter was sent to Tesla Inc (TSLA) by the US National Highway Traffic Safety Administration (NHTSA), as the electric car maker failed to comply with the regulator’s guidelines in its statements regarding Model 3 safety.

The NHTSA also demanded that Tesla provided information about several vehicle incidents.

Tesla shares closed higher for a second consecutive trading session on NASDAQ on Wednesday. It has also been the sharpest daily surge since July 30th. The stock went up 1.16% ($2.67) to $233.42, after touching an intraday high at $233.57, or a price level not seen since August 2nd ($236.27).

Shares of Tesla Inc have retreated 29.86% so far in 2019 compared with a 19.30% gain for the benchmark index, Nasdaq 100 (NDX).

In 2018, Tesla’s stock went up 6.89%, thus, it outperformed the Nasdaq 100, which registered a 1.04% loss.

According to Bloomberg’s report, the cease-and-desist letter by the NHTSA stated that Tesla’s blog post from October 2018, which had presented the Model 3 car as having the lowest probability of injury of any vehicle ever scrutinized by the NHTSA, was not consistent with the regulator’s usage guidelines.

“This is not the first time that Tesla has disregarded the guidelines in a manner that may lead to consumer confusion and give Tesla an unfair market advantage,” Jonathan Morrison, NHTSA Chief Counsel, said in an October 17th letter to Tesla’s CEO Elon Musk, cited by the same media.

Analyst stock price forecast and recommendation

According to CNN Money, the 30 analysts, offering 12-month forecasts regarding Tesla Inc’s stock price, have a median target of $232.50, with a high estimate of $530.00 and a low estimate of $140.00. The median estimate represents a 0.39% downside compared to the closing price of $233.42 on August 7th.

The same media also reported that at least 11 out of 34 surveyed investment analysts had rated Tesla Inc’s stock as “Buy”, while 10 – as “Hold”. On the other hand, other 10 analysts had recommended selling the stock.

Where to Trade

BinaryTribune is a financial media specialized in providing daily news and education covering Forex, equities and commodities. Our academies for traders cover Forex, Price Action, Binary Options and Social Trading.

Related