Tesla Has Wall Street Traders In A Complete Frenzy Right Now

Photo credit AP
Photo credit AP

Tesla spent the latter half of 2017 trying to bounce back from the sluggish start to production of the Model 3 sedan. On Tuesday, it’s set to report fourth-quarter deliveries, but no one has any idea what to expect. In particular, Wall Street’s in a huge tizzy, and it shows the sometimes-absurd power this one hyped and speculated-over company has on the entire market.


Wall Street analysts, working against the cloud of secrecy that hangs over Tesla, have predicted anywhere from 800 to 4,000 Model 3s were delivered in the last quarter of 2017, as we reported in The Morning Shift today. That’s a big range!

The reason for this is that Tesla’s disclosed very little about what it’s done to address a “manufacturing bottleneck” that threw production of the Model 3, which starts at $35,000, off course. Tesla placed most of the blame on issues at the Gigafactory, but earlier said those problems are being worked out.

Initially Tesla expected to produce 5,000 Model 3s per week by the end of 2017; that goal has since been pushed back to late March.

With that in mind, it’s not just Wall Street analysts who have no idea what to expect. Traders themselves are bracing for the worst, reports Business Insider. Equity investors have increased short bets—that is, bets that Tesla’s highly-valued stock will fall—by roughly 22 percent in the three months leading up to today.

Here’s more from BI:

The increase in bearish wagers likely corresponds with mounting concerns over Tesla’s ability to hit delivery targets. It’s been an ongoing worry for Wall Street analysts like Jeffrey Osborne at Cowen, who’s had a long-running “underperform” rating on the stock.


Another explanation for the surge in short interest is one recently floated by S3 Partners — that traders are using short bets on the market’s best-performing stocks to hedge against broader weakness. The wisdom behind using stocks like Tesla as a proxy is that the biggest, most influential stocks dictate the overall direction of the market.


Pity the poor Wall Street trader—unable to figure out what money pit to shove their money into. What’s going to happen with Tesla? No one can say! Chaos ensues. Draw your children close, then eat them. Spare them the catastrophe that may come. Or not.

We’ll see how they react later today once Tesla’s deliveries come out.

Senior Reporter, Jalopnik/Special Projects Desk



My field work confirms there were at a minimum, none deliveries (although there could have been more) as I have seen with my own eyes not a single Tesla Model 3 driving around my city.

I hope this eases some of the tension.