- Tesla shares on Thursday snapped their longest losing streak in nine months.
- Nearly $US7 billion in investor wealth was erased during the six-day skid.
- Markets Insider has detailed five figures that place the staggering sell-off into perspective.
- Watch Tesla trade live.
For six days, Tesla shares appeared in a state of free-fall.
That was before they rose on Thursday, ending a skid that erased nearly $US7 billion in market value. It was the stock’s longest losing streak in nine months.
The severe decline came as widely followed Tesla analysts slashed their price targets and earnings estimates at a rapid clip, highlighting mounting concerns over demand for Tesla’s vehicles and the electric-car maker’s financial position.
It’s not uncommon to see a stock “bounce” after a large sell-off, as investors swoop back in when they think shares are oversold.
Frank Cappelleri, the chief market technician at Instinet, told Markets Insider on Thursday that it would come as no surprise to see a near-term bounce after such a sharp sell-off.
History has shown that when Tesla’s stock has fallen 20% in a week – something it’s done four times in the last six years, and narrowly avoided this time around – a bounce has followed.
“The difference now, of course, is that TSLA has broken below a very clear supply zone – a zone that had previously provided support numerous times,” he said. “Negative momentum has since taken over, and we see the result. This could make an rally attempt at risk of being faded again.”
Here are five figures that place the stock’s recent drop into perspective:
Tesla just snapped its longest losing streak since August 2018
Tesla shares fell for six straight sessions between May 15 and May 22.
That was the longest losing streak in nine months, going back to a seven-day skid in August 2018. Earlier that month, CEO Elon Musk sent shares soaring when he tweeted about having “funding secured” to take Tesla private. Shares ended that month with a small gain.
Tesla’s performance in May
Shares have declined 19% in May, placing the stock on track for its worst month since March 2018, when it fell more than 22%.
Shares have been under significant pressure since Tesla’s bigger-than-expected first-quarter loss
Tesla reported a first-quarter loss last month that was larger than Wall Street was expecting.
The stock fell 8% over the next two days as some analysts cut their price targets and reassessed the company’s direction.
Since the stock-market close on April 24, the day the report was released, Tesla shares have fallen 24%.
Tesla is on track for its worst annual performance as a publicly traded company
With the stock’s 42% decline so far this year, Tesla is on track for its worst annual performance since it went public in 2010.
It’s only negative year was in 2016, when it fell 11%.
Tesla’s best year was in 2013, when the stock soared 344%.
Shares have been cut in half since Musk’s “funding secured” tweet
On August 7, 2018, Musk tweeted, “Am considering taking Tesla private at $US420. Funding secured.”
He then posted a follow-up tweet that said shareholders could either sell at $US420 a share “or hold shares & go private.” That day, shares climbed as high as $US387.46 apiece. They have since fallen 50%.
That initial declaration sparked a monthslong battle with the Securities and Exchange Commission, which was eventually settled in April.
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