Needham & Company Downgrades Tesla Motors (TSLA) to Underperform

(Updated - July 19, 2018 6:12 AM EDT)

(updated to add analyst comment)

Needham & Company downgraded Tesla Motors (NASDAQ: TSLA) from Hold to Underperform.

Analyst Rajvindra Gill believes the company remains overvalued. The analyst comments "Our bearish stance assumes: 1) slower sales of Model S/X on increased competition, possible cannibalization from Model 3 and expiration of credits; 2) slower gross margin improvement for Model 3 based on persistently high manufacturing costs, namely low yields; 3) negative impact to gross margin as ZEV credits decline in 2019; 4) lower energy revenue given the recent restructuring and lastly 5) an unsustainable capital structure with a projected $6BN FCF burn through 2020 and a $1.486BN note due in 2019."

For an analyst ratings summary and ratings history on Tesla Motors click here. For more ratings news on Tesla Motors click here.

Shares of Tesla Motors closed at $323.85 yesterday.

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