JPMorgan has downgraded its price outlook for Tesla shares to $120 from $135, while sticking with an Underweight rating. This decision reflects growing concerns about consumer perceptions of the electric vehicle giant along with a decrease in its delivery figures.
Across the globe, Tesla is encountering significant brand resistance, from boycotts to protests, as well as a noticeable uptick in the resale of previously owned vehicles, particularly in the U.S., analysts noted.
This move accompanies a general market expectation set by LSEG data, which places the median target for Tesla stock at $370. Analysts at JPMorgan are forecasting the company to deliver roughly 1.78 million vehicles in the current year—a slight drop from projections for 2024.
In contrast to these challenges, CEO Elon Musk announced on his own social network platform, X, ambitions to double Tesla’s vehicle production in the U.S. over a two-year timeline. Nevertheless, Tesla shares have seen considerable volatility, plummeting from last December’s peak, which erased the surge that had followed Donald Trump’s U.S. presidential victory in November. Despite recent setbacks, including a 15.4% plunge on Monday marking the sharpest decline in four and a half years, the stock has rebounded with a 10% gain.
Earlier, UBS had 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.
