With Tesla share values down more than a third since their peak in January, newly released data from uk.Investing.com has revealed that 48 percent of UK investors believe Elon Musk has built up Tesla stock’s price based on “fantasy” and anticipate further losses in 2021.
According to the survey of 837 UK respondents, 45 percent of investors believe that Tesla’s market cap will continue dropping this year. Yet Musk can rely on the unwavering support of Tesla investors, with 64% more loyal to the CEO than the company itself.
“As one of the leading innovators in the auto industry, Tesla has generated a lot of interest from retail traders in recent years,” said Jesse Cohen, senior analyst at uk.Investing.com. “It has developed a loyal cult-like following from fans and enthusiasts who believe in the company’s technology and often laud CEO Elon Musk with praise, devotion and admiration. However, at the same time, the company has many vociferous critics who argue the electric vehicle pioneer could go bankrupt in the years ahead due to its soaring debt and high cash burn.”
Despite Musk creating a devoted following among those invested in Tesla, just 27 percent of UK investors on the whole believe Tesla share values will rise before the end of 2021 to a price close to the January highs, and only 7 percent anticipate a finish to the year that exceeds the stock’s previous peak. Investors’ prognosis is slightly more optimistic in the long run, with 22 percent saying the stock price will land between $1,000 and $2,000 two years from now, followed by 18 percent projecting an $800-1,000 value and 12 percent a value of $2,000-3,000.
“The insane run-up in the price of the stock over the last decade is, like all investments, a bet on the future,” Cohen continued. “As such, it helps to be comfortable with roller coasters if you want to buy Tesla stock. That’s because wild up-and-down volatile price swings have become a hallmark of the stock’s performance over the years.”
“It is important to remember success won’t happen overnight when dealing with a volatile stock like Tesla. Investors should take a long-term approach on their investment, especially if they believe in the company for the long haul.”
The survey also revealed the sheer influence of Elon Musk, with 74 percent of UK investors believing him to be the most influential personality around when it comes to financial markets. Moving forward, 73 percent of investors expressed support for policies that would reduce the power of big influencers such as Musk when it comes to manipulating financial markets.