Since CEO Elon Musk took over the reins of the social media company, Twitter, the shares of electric vehicle giant Tesla (NASDAQ:TSLA) have declined about 16%. Musk’s takeover was followed by several efforts to mitigate problems that have been impacting Twitter’s performance, including slowing advertising revenue, a $12.5 billion debt load, and an elevated cost base.
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The latest trouble for Twitter comes from the Federal Trade Commission (FTC). The WSJ reported that the agency has requested that Twitter submit internal communications involving Musk and the details of layoffs that have occurred since he acquired the business.
Basically, the FTC is concerned that the drastic cutdown in Twitter’s workforce to less than 2,000 employees from 7,500 in October 2022 might affect its ability to protect consumers’ privacy. On these matters, the agency seeks to have an audience with the CEO himself.
Owing to a settlement in 2022, Twitter is bound by a consent order with the FTC, under which the agency is supposed to investigate the company’s privacy practices. It is worth highlighting that the spike in the FTC’s interest in Twitter comes as most of the layoffs have impacted privacy, security, and compliance employees.
Is Tesla a Buy, Sell, or Hold?
Persistent problems at Twitter continue to distract Musk’s attention, which is likely taking a toll on Tesla’s performance. Tesla Investor Day, held on March 1, turned out to be a big disappointment for Tesla lovers as it was devoid of details. Furthermore, the company is facing several setbacks, including vehicle recalls, faltering demand, and strong competition in the EV space.
Overall, Wall Street is cautiously optimistic about Tesla stock, with a Moderate Buy consensus rating based on 22 Buys, eight Holds, and three Sells. The average TSLA stock price target of $211.59 implies 12.7% upside potential from the current levels.
