Shortly after Elon Musk frantically turned to Twitter to reveal to the world that Apple CEO Tim Cook wouldn’t return his calls when Musk was searching for a bailout, Morgan Stanley revealed its take on the implications Tesla now faces following Apple’s entrance into the EV market.
According to a note released by Morgan Stanley Analyst Adam Jonas, Apple’s plans to dive into the auto market creates the most daunting bear case for Tesla’s stock that investors will have to face as of late. Jonas predicts that Apple’s recent announcement has a strong potential to diminish Tesla’s skyrocketing price, with its buy rating falling to a $540 price target – roughly 15% below current trading levels.
Moreover, with the iPhone maker potentially making a debut into the vehicle market, other legacy automakers such as Ford and GM could have their competition efforts stiffened if Apple really wanted to “throw its weight around.” Given Apple’s historic success and proven access to talent and capital, the company has all of the necessary ingredients to make a big footprint in the auto industry.
Information for this briefing was found via Bloomberg. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.