Tesla Motors Inc TSLA 2.52% could be one of the best short-selling opportunities in the market today. According to Bank of America analyst John Murphy, Tesla’s stock has nearly 30 percent downside ahead.

Tesla’s recent $2 billion equity offering was not surprising given the companies ambitious growth goals and high cash burn, but Murphy believes shareholders should prepare for even more dilution in the future. He pointed out that Tesla’s $750 million equity raise in Q3 of 2015 quickly evaporated when the company burned $1 billion in the second half of 2015.

“With roughly $1.4 billion of cash on its balance sheet at the end of 1Q16, and an estimated quarterly cash burn rate of ~$(400)+ multi-million, we believe the incremental capital, as well as a full-draw down on its existing ABL, will likely only sustain TSLA through 2017,” Murphy explained.

Murphy continued…

Click here to continue reading

Want to learn more about how to profit off the stock market? Or maybe you just want to be able to look sophisticated in front of your coworkers when they ask you what you are reading on your Kindle, and you’d prefer to tell them “Oh, I’m just reading a book about stock market analysis,” rather than the usual “Oh, I’m just looking at pics of my ex-girlfriend on Facebook.” For these reasons and more, check out my book, Beating Wall Street with Common Sense. I don’t have a degree in finance; I have a degree in neuroscience. You don’t have to predict what stocks will do if you can predict what traders will do and be one step ahead of them. I made a 400% return in the stock market over five years using only basic principles of psychology and common sense. Beating Wall Street with Common Sense is now available on Amazon, and tradingcommonsense.com is always available on your local internet!