NFLX provides a good case study of how an otherwise pristine company made a series of PR blunders in quick succession that shattered investor confidence and caused the stock to plummet. Golden children, priced to perfection, are extremely vulnerable to such a turn.
Think back to when Tesla announced the voluntary recall in June, on the blog.
Partial Recall | Blog | Tesla Motors The stock went up because Tesla proactively owned it, acknowledged it, and articulated their plan. Customers and investors will forgive mistakes if a company owns up to it and acknowledges it and provides a plan.
Tesla could stop the bloodletting now by taking control of the message, rather than trying to allow a few spokesperson comments land here or there at some news outlets. The WSJ just came out with a story with the headline, "Tesla Shares Keep Burning, Questions Swirl About Car Fire." Do folks realize how incredibly damaging that headline is? "Questions swirl" implies lack of control, lack of transparency, lack of trust, lack of competency, unanswered questions. The story has no Tesla comment, and when there's a void of information reporters seek out information from others who are less informed. There's an analyst comment. Sorry, but when you're facing a PR crisis, the company needs to carry the message, not a surrogate analyst.
