Wall Street analysts tend to agree that most stocks agree. But analysts are deeply divided on a handful of stocks. The most controversial of these is undoubtedly Tesla, the electric car maker. According to FactSet, the variance in Tesla’s target price is the largest of any stock.
In addition to Tesla, several top technology companies such as Facebook, AMD and Square, uber and Lyft, and General Electric, the troubled industrial group, also received diametrically opposed reviews. According to a survey of analysts, here are 20 of the most controversial companies with a market capitalisation of more than $10 billion.
Jefferies recently set a high target price for Tesla, saying the company’s share price would climb to $400 a share. In a note to investors, Jeffery said Tesla is expected to stabilize in 2019, “laying a better foundation for returning revenue and earnings growth in 2020.” The company also expects Tesla to maintain “product, price and technology advantages” next year, and said it would embark on a “continuous profitability” path.
But UBS, which is pessimistic about Tesla, expects Tesla’s share price to fall by half next year. UBS said in a recent report that it saw the general slowdown in discretionary spending as a “critical risk” for carmakers, and expected Tesla to struggle with “inability to reduce battery costs and performance”, as well as threats to the battery supply chain and changes in the way electric vehicles are regulated.
Shares in General Electric have been strong this year, up more than 50 per cent, and William Blair believes it will climb further. The company was the most optimistic about GE’s stock, telling investors after it reported third-quarter results that GE “continues to perform well against a backdrop of geopolitical turmoil” and that “it is indisputable that there will be more volatility in the future”. William Blair expects GE to “close strongly in 2019” with a target price of $15, meaning the company’s share price will rise another 35 per cent.
JPMorgan, on the other hand, remains GE’s biggest bear. Ge has been Wall Street’s sharpest critic of GE since it warned investors three years ago that its share price would plummet, with a target of $5. In a recent report, JPMorgan said it did not believe GE’s “management has set a bottom for its business performance,” adding that “GE has fallen short of the guidance set in March for pre-tax profits on its core business.” “
Similar to GENERAL ELECTRIC, social media giant Facebook has performed well this year, with shares up nearly 55 per cent. Mizuho Securities lists Facebook as the top choice for internet stocks. The company said its “pragmatic approach” to regulation will help it overcome political concerns following its recent quarterly results and expects Facebook to raise key products such as online payments by 2020.
But Societe Generale believes Facebook’s share price will fall sharply. The company said Facebook’s recent performance had only added to “already high” expectations and said it must now address “a number of privacy, security and regulatory issues.” Societe Generale expects Facebook’s share price to fall to $120 a share in the coming months, down 40 percent from its current share price of nearly $200.