Tesla stock dropped another 2% in premarket trading Friday after falling 5.5% Thursday.
HSBC initiated coverage on the stock with a rating of "reduce" and a $146 price target. The analyst offered a novel argument against Tesla stock, saying that the company is increasingly pitching itself as a business built around artificial intelligence (AI), and autonomous vehicles and robots, rather than electric vehicles (EVs). That is inherently much riskier than being a carmaker, and for that reason, the stock should have a higher cost of capital due to the regulatory and technological challenges it faces in the transition, making the stock worth less.
In addition, President Joe Biden on Thursday backed the United Auto Workers' efforts to unionize carmakers Tesla and Toyota and asked auto workers to reject his Republican opponent, Donald Trump.
Biden spoke to UAW workers in Belvidere, Illinois, as the Democratic president tries to rally support for his economic agenda and firm up sagging popularity numbers, ahead of a re-election campaign next year.