The electric carmaker, Tesla Motors Inc (NASDAQ:TSLA), is continuing a tough ride with its shares falling in excess of 15% in the past two weeks. The shares of the electric automobile company declined nearly 1% after its Chinese head left the position without any notice.
Tesla does have a bright future and the demand for its electric automobiles is likely to grow at a healthy rate. However, the auto manufacturer is enduring some tough days as its growth prospects in the Chinese markets are having some setbacks.
First, the existing head of China, Veronica Wu, left the company without giving any explanation. This might be a bad news for the company as the Chinese market is showing excellent demand for electric vehicles with support from the government. In addition to it, Tesla Motors Inc (NASDAQ:TSLA) is investing heavily to install charging stations in the country; however, the common share parking enjoyed by the Chinese consumers is a tough nut to crack because Tesla’s cars require in-house charging facilities.
The secondary problem for Tesla Motors Inc (NASDAQ:TSLA) is its continually falling share prices. The shares of the electric carmaker have declined 24% in the last three months after reaching a record price of $286.04 on September 04. Ari Wald, technical analysis head at Oppenheimer, has predicted a support level at $180 and called the condition “a little concerning” in the shorter term.
Erin Gibbs, S&P Capital IQ Global Markets Intelligence’s Chief Investment Officer, has supported Wald’s price target and further added that the shares of Tesla Motors Inc (NASDAQ:TSLA) are likely to find a base near 100x forward earnings.
The falling share prices are a bit depressing considering the 153% Year-over-Year increase in October registrations for Model S. The shares of Tesla are trading at $207.00 with 37% growth year-to-date.
This article has been written by Prakash Pandey.