Sep 28, 2018

What they're saying: Analysts sound off on Musk lawsuit

Photo: Bill Pugliano/Getty Images

Wall Street analysts are reacting negatively to the Securities and Exchange Commission's fraud lawsuit against Tesla CEO Elon Musk, which sent the automaker's stock sharply lower.

Why it matters: In the past year, Elon Musk has evolved from one of Tesla's biggest assets to one of its biggest risks.

What analysts are saying:

  • Brian Johnson, Barclays: "While Tesla may still have value as a niche automaker, the premium the shareholders have been willing to pay for future founder-driven business optionality is likely to dissipate."
  • Romit Shah, Nomura Instinet (who recently called Tesla "uninvestable"): "We believe that the removal of Mr. Musk as Chairman and CEO could have wide ranging impacts on the company, its brand, and its ability to raise funds."
  • Colin Langan, UBS: "Regardless of the outcome of the lawsuit, we continue to estimate Tesla will need to raise capital in 2019. Technically, Tesla could still raise capital despite the lawsuit against Musk; however, it may be more challenging if investors are concerned about Musk’s ongoing role at the company... Without Musk, investors may no longer be willing to continue funding a company that has never reported an annual profit."
  • David Whiston, Morningstar Research: "We see immense key-man risk for the stock, as Tesla's fate is closely linked to Musk's actions. Should he leave the company, we would not be surprised to see the stock fall dramatically."

Go deeper: Elon Musk throws a Tesla tantrum by refusing to settle

Go deeper

In photos: We've seen images like the protests in Minneapolis before

Photo: Kerem Yucel/AFP/MPI/Getty Images

The photos of protests around the country following the death of George Floyd during an encounter with Minneapolis police are hauntingly familiar. We’ve seen them many times before, going back decades.

Why it matters: "What is also unmistakable in the bitter protests in Minneapolis and around the country is the sense that the state is either complicit or incapable of effecting substantive change," Keeanga-Yamahtta Taylor, an assistant professor of African-American studies at Princeton University writes in the New York Times. The images that follow make all too clear how little has changed since the modern Civil Rights Movement began in the 1950s.

Updated 6 mins ago - Politics & Policy

Coronavirus dashboard

Illustration: Aïda Amer/Axios

  1. Global: Total confirmed cases as of 11 a.m. ET: 5,968,693— Total deaths: 365,796 — Total recoveries — 2,520,587Map.
  2. U.S.: Total confirmed cases as of 11 a.m. ET: 1,749,846 — Total deaths: 102,900 — Total recoveries: 406,446 — Total tested: 16,099,515Map.
  3. Economy: The future of mobility in the post-pandemic worldGeorge Floyd's killing and economic calamity are both part of America's unfinished business.
  4. Supreme Court: Chief Justice Roberts sides with liberals in denying challenge to California's pandemic worship rules.
  5. Public health: Hydroxychloroquine prescription fills exploded in March.
  6. 2020: North Carolina asks RNC if convention will honor Trump's wish for no masks or social distancing.
  7. Business: Fed chair Powell says coronavirus is "great increaser" of income inequality.

The aftermath of George Floyd's death: Everything you need to know

A mural outside Cup Foods in Minneapolis, near where George Floyd was killed in an encouner with police. Photo: Steel Brooks/Anadolu Agency via Getty Images

Former Minneapolis police officer Derek Chauvin is in jail under $500,000 bail on charges of third-degree murder and manslaughter after a video of him kneeling on George Floyd's neck for more than eight minutes and Floyd's death catapulted the country's major cities into a state of protest.

The big picture: Floyd's fatal run-in with police is the latest reminder of the disparities between black and white communities in the U.S. and comes as African Americans grapple with higher death rates from the coronavirus and higher unemployment from trying to stem its spread.