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Tesla (NASDAQ: TSLA[/tock]) has found itself in rough waters. About two weeks ago its CEO and Chairman Elon Musk tweeted out that he had ambitions of taking the company private for the lavish sum of $70 billion dollars. At $420 per share, the proposed buy-out plan would be a huge upside for Tesla investors and naturally, the stock soared in the following days.

Investors and analysts alike were puzzled as Musk would need to secure funding somewhere in the neighborhood of $50 billion (in the event all stockholders were bought out) to make up for the 80 percent of the company he does not own himself. Things began to look less dicey as the Saudi Arabia foreign wealth fund was reported to have taken a somewhat small 5 percent stake in the company valued at $2 billion.

However, recent reports in the last 24 hours have hinted that Saudi is now considering investing in rival Lucid Motors, instead. Not good news for Elon Musk, who could be facing trouble if the SEC are to press charges over the now infamous tweet below:

Am considering taking Tesla private at $420. Funding secured.

— Elon Musk (@elonmusk) August 7, 2018

So there are a few problems swirling around this. First, there was some doubt as to whether Elon's tweet followed proper guidelines for disseminating company information to investors. There's been some somewhat solid arguments made that Tesla has in fact, pointed to Musk's Twitter account for Tesla news in the past, so that will probably not be an issue moving forward. We can in all likelihood forget about this first issue.

Next, there is the question of whether or not Elon was bluffing with his statement. If he didn't have "funding secured", which a recent blog post of his casts doubts on, then the SEC could potentially subpoena him for issuing false or misleading statements. Believe it or not, Elon basically claims the Saudi investors were "totally down" to help Tesla private with no actual deal agreed upon as his reasoning for the tweet. Here is a blub from his blog post dated August 13th, 2018:

Recently, after the Saudi fund bought almost 5% of Tesla stock through the public markets, they reached out to ask for another meeting. That meeting took place on July 31st. During the meeting, the Managing Director of the fund expressed regret that I had not moved forward previously on a going private transaction with them, and he strongly expressed his support for funding a going private transaction for Tesla at this time. I understood from him that no other decision makers were needed and that they were eager to proceed.

I left the July 31st meeting with no question that a deal with the Saudi sovereign fund could be closed, and that it was just a matter of getting the process moving. This is why I referred to “funding secured” in the August 7th announcement.

Now that PIF, the Saudi wealth fund in question, is in talks to invest in rival Lucid Motors, this deal could be nothing but thin air in the rearview mirror.

All of this adds up to a massive distraction for a company that is currently in what could be called an extremely sensitive position. The Model 3 is finally truly ramping up volume shipments and there shouldn't be much in the way of stopping Tesla from finally becoming profitable. With Model X, S, and 3 vehicles all hitting record production numbers, the automaker should be able to capitalize and become, as Tesla stated during its last earnings call, cash positive for the remaining half of 2018.

Investors may want to take note that JP Morgan analyst Ryan Brinkman has lowered their price target altogether for Tesla, citing the "going private" ordeal. Brinkman now has a PT of $195 for Tesla, representing a near 30 percent discount from today's closing price of $308.44.

JP Morgan wasn't the only firm lowering their expectations of Tesla stock. Piper Jaffray senior technical market analyst Craig Johnson said, "Key support is at $285 and failure to hold this level leaves the shares back in the 2013-2016 consolidation range of $183-$285".

Prices are down 20 percent since the price spike after Elon's tweet two weeks ago.