Shares of Telsa (TSLA) are higher on Wednesday, after the electric vehicle maker’s shareholders approved a long-term compensation package for its CEO, Elon Musk.
However, CFRA’s Efraim Levy isn’t convinced it was a wise move, and he reiterated a Sell rating on the stock.
Sure, Levy understands why the shareholders might like the plan: It could be seen as a “potential win-win” for both the stock and Musk, as the objectives align with a “shareholder-combination” that includes aggressive market capitalization and operational targets.
At the same time, however, he wonders why Musk needs these steep incentives, given that he already has a substantial equity stake in Tesla, and his personal reputation is also on the line. Overall, Levy writes that the stock still looks overvalued to him, hence his bearish stance. If you agree with Levy, there are always other stocks to play the electric car boom.
Tesla is up 2.2% to $317.49 in afternoon trading.