Investors have intensified their selloff on Elon Musk’s Tesla stocks on Monday, marking a drastic 15% decline for the electric vehicle giant—a drop unmatched since September 2020. Following a prolonged downturn, Tesla’s shares have now endured seven consecutive weekly losses, aligning with the Nasdaq’s broader tumble of nearly 4%, its sharpest fall since last year.
The drop in Tesla’s share value, with a cumulative descent from its December high point of $479.86, has halved the company’s market capitalization, stripping away over $800 billion. This downturn coincides with CEO Elon Musk’s active political engagements in Washington, D.C., with the Trump administration.
Meanwhile, UBS has revised its outlook on Tesla, adjusting its target price downward from $259.00 to $225.00 and sticking with a “Sell” rating, after the Q4 2024 results underwhelmed market expectations. The Swiss bank also lowered its Q1 2025 vehicle delivery forecast from 437,000 to 367,000 units, citing underwhelming delivery pace, although potential spikes are anticipated with increased promotional strategies.
While Tesla reported revenue growth of just 0.95% over the past year, UBS’s Evidence Lab highlighted reductions in delivery wait times for leading models like the Model 3 and Model Y in major markets, signaling possible demand softness. Meanwhile, Tesla’s auto gross margin dropped to 10.3% from the 16.4% seen earlier, excluding credits, reflecting these demand challenges.
The prevailing consensus among 45 Wall Street analysts places Tesla’s mean target price at $338.49, as the electric vehicle manufacturer navigates through persistent market volatility.
