Tesla's Market Turbulence: Analysts Predict Further Declines Amid Valuation Concerns

Key Points

• Tesla (TSLA) is the worst-performing S&P 500 stock year-to-date with analysts predicting further declines.
• Bernstein has reduced Tesla's stock-price target to $120 suggesting a 33% downside from its current level.
• Tesla faces challenges including softening demand margin pressures and increased competition.

In this news

Tesla, Inc. Common Stock (TSLA) has been facing significant headwinds in the stock market, with a year-to-date performance that places it as the worst-performing stock in the S&P 500, plummeting by approximately 28.5%. Analysts from firms such as Bernstein and GLJ Research have raised red flags over Tesla's valuation, suggesting that there may be more pain ahead for shareholders. Bernstein has notably slashed its price target for Tesla from $150 to $120, indicating a potential 33% downside from its current trading position.

The earnings outlook for Tesla (TSLA) appears to be on shaky ground, with expectations of a decline due to a combination of softening demand for electric vehicles and increasing pressure on profit margins. The company is reportedly attempting to shift its focus away from its core automotive business, which is currently besieged by challenges. Despite this, analyst recommendations for Tesla stock remain mixed, with a consensus rating hovering around 'Hold'.

Looking ahead, Tesla (TSLA) is anticipated to grapple with intensified competition, an aging model lineup, and potential delays in scaling its next-generation platform, which could be pushed back as far as 2026. With analysts adjusting their financial forecasts and expressing concerns about the company's growth prospects, Tesla's future in the stock market remains uncertain, with significant challenges to overcome.