This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

'Fast Money' Recap: Valuation Matters for Tesla

NEW YORK (TheStreet) -- While the Nasdaq slumped 0.32%, the S&P 500 climbed 0.56% on Wednesday. 

On CNBC's "Fast Money" TV show, Guy Adami, managing director of, said "valuation suddenly seems to matter" for shares of Tesla Motors (TSLA). Without its upside momentum, investors have to wait for a large-volume day where the stock reverses to the upside before getting long. 

Steve Grasso, director of institutional sales at Stuart Frankel, pointed out how well shares of Tesla have held up compared to many other "momentum" stocks over the past month. 

Brian Kelly, founder of Brian Kelly Capital, said investors are no longer willing to "stand for this type of uncertainty." Specifically regarding Tesla, he was referring to costs, sales volume and the Gigafactory as shareholder uncertainties. 

Karen Finerman, president of Metropolitan Capital Advisors, warned that shares of Tesla have not gone down nearly as much as they could, and a "collapse" in the stock price is still in the realm of possibilities. 

Ben Kallo, an analyst at R.W. Baird, has a buy rating on shares of Tesla with a $275 price target. He said the company reported a great quarter, guided for strong deliveries in the next quarter and is "firing on all cylinders." Although R&D spending is expected to increase and possibly took investors by surprise, Kallo said it is "necessary" for the company and its international expansion plans. He suggested buying the stock near $175. 

Turning to SolarCity (SCTY), the company beat on top-line expectations while once again surprising analysts by raising guidance. Kallo has a buy rating on shares of SolarCity with a $75 price target. He added the stock has more room to the upside and analysts will need to hike their price targets. 

Grasso said the $175 level in Tesla Motors coincides with the 200-day simple moving average. However, he admitted that that level may fail to hold as support. 

Kelly pointed out how poorly SCTY has traded compared to TSLA over the past several months, adding that the latter could have further downside ahead. 

Adami said the S&P 500 has been rather "impervious" to the selloff in momentum stocks but admitted the pressure is currently to the downside for the broader market. He argued that good, but not great earnings results and slower than expected growth could be a negative for stocks. 

1 of 3

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,156.85 +24.88 0.15%
S&P 500 2,001.57 +2.59 0.13%
NASDAQ 4,562.1890 +9.43 0.21%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs