Tesla undermined Elon Musk's defense against SEC: JPMorgan
Tesla may have just injured Elon Musk's own case of the kind with the SEC, according to JP Morgan.
" The now clear inconsistency of the CEO's statement of statements with official company guidance can damage the perception of management comments, destroy the investor's confidence and potentially place further pressure on the shares, analyst says. Ryan Brinkman in a note to clients late Wednesday.
"All year delivery guide was stated in the release to have been" confirmed "at an earlier level of 360,000 to 400,000 units, which we undermine a key term for CEO Elon Musk's legal defense against the SEC ̵[ads1]1; that his February 19 tweet that Tesla will Making around 500,000 cars in 2019 was not new information needed for pre-approval, "Brinkman said.
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On Thursday, Musk goes to Manhattan's federal court to continue his faceoff with the Securities and Exchange Commission, claiming he has violated an earlier agreement by posting important information on Tesla on February 19. [19659003] Musket tweeted to its more than 24 million Twitter followers: "Tesla has made 0 cars in 2011, but will make around 500k in 2019."
Tesla shares fell more than 10 percent in premarket trading Thursday morning.
Although the government claims that Musk's tweet broke an agreement not to post material information without first seeking approval from company lawyers, the chief executive has argued that the information was innocent and did not need to be discovered. He will try to convince the court that he did not violate a fraud statement in October and should not be disdained.
But Tesla's press release on Wednesday night can undermine this argument with the latest production updates.
"Despite the demand from Q1 2019 to Q4 2018 due to the decline in federal tax credit, US orders for Model 3 cars were significantly larger than we could deliver in Q1 "We affirm our earlier guidance of 360,000 to 400,000 vehicle deliveries in 2019," press release said.
said Brinkman: "Although it could be argued that official year-round guidance increased somehow from 360-400K deliveries at the time of the shareholder's letter to 350-500K of Model 3 alone just hours later, to 420-600K total production February 28 – and now back to 36-400K deliveries – the choppiness and inconsistency of this communication will still, in our opinion, destroy the investor's confidence. "
