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Tesla CEO Elon Musk may be headed for an impromptu meeting with his HR department following his repsonse to a post from Wedbush analyst Dan Ives on Tuesday by writing “Shut up, Dan,” after Ives shared recommendations for the Tesla board on X.
Musk's recent involvement in the Trump administration and its controversial gutting of federal departments, overseen by Musk, has had a direct impact on Tesla sales and share price. His newest political pronouncements are also causing concern for the board.
Ives, who has the highest Tesla stock price target on Wall Street at $500, raised concerns about Musk’s announcement of his new America Party and its political implications. The post followed a 7% drop in Tesla’s stock on Monday, which erased $68 billion in market value.
He called for Tesla’s board to issue a new compensation package for Musk that would give him 25% voting control and allow for a merger with xAI. He also recommended “guardrails” on how much time Musk devotes to Tesla and board oversight of Musk’s political endeavors.
In a follow-up post titled, “The Tesla board MUST Act and Create Ground Rules For Musk; Soap Opera Must End,” Wedbush analysts said the America Party launch marked a “tipping point in the Tesla story,” and urged the board to act.
“Shut up, Dan,” Musk responded on X.
Despite the criticism, Wedbush kept its $500 target and buy rating on Tesla shares.
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“Elon has his opinion and I get it, but we stand by what the right course of action is for the Board,” Ives said in an email to CNBC.
Concerns grow over political focus
Musk’s 2018 CEO pay package, once worth $56 billion, was voided last year by the Delaware Court of Chancery. The ruling cited a lack of independence by Tesla’s board and improper negotiation with Musk. Tesla is appealing the decision and working on a new package.
William Blair analysts downgraded Tesla stock from buy to hold, citing concern over Musk’s “political plans and rhetoric” and the impact of a recent federal spending bill on Tesla margins and EV sales.
“We expect that investors are growing tired of the distraction at a point when the business needs Musk’s attention the most and only see downside from his dip back into politics,” they wrote. “We would prefer this effort to be channeled towards the robotaxi rollout at this critical juncture.”
James Fishback, CEO of Azoria Partners, said his firm delayed the launch of an ETF (Exchange Traded Fund) focused on Tesla due to Musk’s political activities. “Elon has gone too far,” he said on X. Fishback called on Tesla’s board to meet “immediately” to evaluate Musk’s political ambitions and how they align with his CEO duties.
Tesla’s share price under pressure
Tesla stock is down 25% this year, trailing other tech megacaps and US indexes.
Musk said Saturday he had launched the America Party to give Americans “back your freedom,” but provided no details about registration, funding or endorsed candidates.
