MarketWatch reports Tesla stock falls even farther after recall of 123,000 Model S cars.
Tesla Inc. finished off its worst month in seven years with the news late Thursday that the electric-auto maker is recalling 123,000 Model S vehicles due to a potential flaw in a power steering component.
Investors continued to punish Tesla in after-hours trading, with the stock more than 3% in the red, giving back the day’s regular-session gains of 3.2%, when it closed at $257.50. Tesla stock is down 23% in the past month, as the S&P 500 index SPX, +1.38% has fallen 4%. Markets are closed Friday in observance of Good Friday.
The recall of the Model S vehicles is due to a bolt that could corrode, an issue that occurs in cars built before April 2016, and in winter conditions where roads are frequently salted, the company said. Just 0.02% of the cars ever experience the problem, Tesla said.
It's a small percentage of cars involved in the recall, but it will prove to be costly to a company already struggling to stay afloat.
Fraudulent Conveyance Lawsuit
Fraudulent Conveyance is heading to court: Tesla shareholder lawsuit against SolarCity deal set to proceed.
A class action lawsuit by Tesla Inc shareholders against the electric car maker's chief executive, Elon Musk, and the company's board over the SolarCity deal was set to proceed after a Delaware judge refused to dismiss it.
The news and sentiment is now so terrible that I wonder if a bounce is coming. I won't take much to cause a bounce, but I am not playing with this puppy. The floor could fall out at any time.
Crashes do not happen in overbought conditions, they happen in oversold conditions, and Tesla has everything going for it.
For discussion of fraudulent conveyance, please see Tesla Bankruptcy? Fraudulent Conveyance?
Mike "Mish" Shedlock