These are times of nervousness to Tesla fans on Wall Street. Now they believe the future is no longer what it was, paraphrasing the famous market analyst Yogi Berra.
In recent weeks, even some of Tesla’s biggest supporters among analysts are changing course. They are reducing their high target prices to 12 months and sounding the alarm over the reaction against polarizer CEO Elon Musk – and the damage it has caused Tesla brand since it became a high -level member of Trump’s team.
At the end of last month, Deutsche Bank analysts, RBC Capital Markets, Stifel Nicolas and Piper Sandler reduced target prices for Tesla.
And on Sunday came the shock, through one of Tesla’s most prominent optimistic: Dan Ives, from Wedbush Securities, reduced its target price to 12 months by 43%to 315 dollars.
The movement caused Tesla shares to fall more than 7%, to a minimum of $ 222.24 at the beginning of the market, in the middle of a volatile morning for stocks in general – before recovering some of these initial losses in the early afternoon, closing 2.6% lower. The slip follows a drop of more than 5% on Thursday and more than 10% on Friday.
Ives also has a “overpoise” recommendation, or buy, for Tesla, because he believes the company still has long -term strengths. But with the protests at Tesla’s showrooms and the drop in sales around the world, he said it is critical to Tesla’s future that Musk moves away from Trump administration before it’s too late to repair the damage.
Investors seem to agree. Even after Tesla reported her biggest drop in quarterly sales in the company’s history on Wednesday, the actions closed up after the politician reported the same day as Musk was preparing to get away from her role in the short term. But responsible from the White House and Musk rejected the allegation, with the CEO classifying it as “fake news.”
These denials may have impaired Tesla’s actions, as well as the growing recession fears linked to Trump government plans with tariffs – although Tesla is less exposed to US tariffs than other car manufacturers.
The Tesla’s post-election roller coaster
Tesla’s actions almost doubled in value between election day and a historic peak on December 17, as many investors believed that the narrow ties of Musk with Trump would help the brand. But since then, as it has become more evident that Musk would play a central role in some of the administration’s most controversial measures, they have lost virtually all these gains.
Administration members took extreme measures to try to help Musk. Trump announced that he would buy a Tesla himself and organized an event at the White House to introduce the cars. Then, on March 19, the Secretary of Commerce and former Executive of Wall Street, Howard Lutnick, said at Fox News that viewers should “buy Tesla” and that actions “will never be so cheap.”
According to experts, these comments may have violated the rules of government ethics. However, the recent drop in shares means that Tesla’s actions are, in fact, below this point.
The global reaction is “very bad” for Tesla
Ives wrote that while still seeing an advantage for Tesla’s long -term actions, Musk’s political role has caused serious damage to the brand in the short term.
This is the case not only in America, but also in Europe and China, Ives said. China is the world’s largest electric vehicle market and is also Tesla’s second largest market behind the United States, with nearly $ 21 billion in sales in 2024.
Ives called China “The Key to Tesla’s future success.” He warned that “Trump’s tariff policies reaction in China and the musk association will be difficult to underestimate,” which will “lead Chinese consumers to buy home products even more.” The official estimates that the company has lost 10% of its future customer base worldwide, which, according to him, could be a conservative forecast.
Tesla “has essentially become a political symbol worldwide … and this is very bad for the future of this disruptive technology,” he said.
Like Ives, Deutsche Bank analysts, Stifel Nicolas, Piper Sandler and RBC Capital Markets continue to have a purchase recommendation for Tesla, despite their short -term doubts. All still have target prices at 12 months above the current price of stock.
But there are prominent Wall Street analysts – including those of JPMorgan Chase and Wells Fargo – who tell investors to sell their Tesla actions. Both predicted that Tesla’s shares will lose more than 40% of their value over the next year, from the point of last Friday.
“Tesla’s first quarter sales and production report leads us to think that – if so much – we may have underestimated the consumer’s degree of reaction,” wrote Ryan Brinkman, an analyst at JPMorgan Chase, in a note to customers on Friday. “What seems clear, however, is that the trend in Tesla sales is worse than we and the market we predicted.”
