Tesla's stock (TSLA) has faced significant challenges over the past months, culminating in its recent dip below the $300 mark, as bearish sentiments have infiltrated the market. On Thursday, February 27, 2025, the stock fell 12 points during the day's trading, reflecting a nearly 4% decline. This marks approximately 26% decrease year-to-date, indicating Tesla's dwindling performance amid increased competition and operational hurdles.
The electric vehicle manufacturer has been struggling to maintain its dominance, particularly as sales have taken a sharp downturn. Recent data from the European Automobile Manufacturers Association (ACEA) showed Tesla’s vehicle sales dropped to only 9,945 units sold from 18,161 the previous year. This significant decrease points to decreasing market dominance, especially as Chinese competitor SAIC Motor recorded impressive growth with 36.8% increase in sales across Europe.
Meanwhile, Tesla is also grappling with disappointing sales figures from its key market, China, where it experienced an 11.5% decrease year-over-year. The company sold 63,238 cars during February 2025, down from 71,447 units the previous year, highlighting the urgent need for the company to regain its footing.
Market analysts and investors are voicing concerns, expressing skepticism about when the stock might stabilize. "It is hard for Tesla to catch up with the smart-driving capabilities in Chinese cars, which even makes less sense, considering its high pricing," remarked Lu Panpan, a Tesla owner, during an interview with Reuters.
These factors have compounded pressures on Tesla, creating fears among traders and influencing bearish activity across the stock’s charts. Conversely, the S&P 500 index showed minimal movement, opening at 5864 on the morning after the recent US elections, yet it reflected how broader market sentiment can impact individual stocks.
Following the elections, hopes were high for economic growth spurred by potential extensions to Trump's tax cuts and streamlined regulations. Yet, chaotic foreign policy developments and newly imposed tariffs seem to have altered positive investor sentiment. While some analysts believe the pro-growth agenda might eventually prevail, others are cautious about immediate trading stability.
On the analyst front, Tesla has garnered mixed evaluations. UBS recently upgraded its price target from $226 to $259, maintaining a “sell” rating. Meanwhile, other firms like Roth MKM and Wedbush have tilted their projections more positively. Roth MKM upgraded Tesla’s rating from “neutral” to “buy” and set the target price at $380, whereas Wedbush indicated a target of $328.50.
This fluctuation has resulted garnered Tesla mixed ratings, with several analysts issuing holds based on varying projections; 13 have rated the stock as “buy,” 12 as “hold,” and 10 as “sell” according to current data. Overall, Tesla’s consensus rating sits as “Hold” with the average target price landing at $319.57 as reported by MarketBeat.com.
Regulatory scrutiny also looms over Tesla following probes by the National Highway Traffic Safety Administration relating to its autonomous features. These external pressures compound existing issues and leave investors unsettled about the company's long-term profitability.
Despite these challenges, Tesla seems intent on innovatively propelling forward. The company has plans for launching unsupervised robotaxi testing slated for June 2025, along with the introduction of a revamped Model Y and more affordable electric car aimed at enhancing its market appeal.
Investors are closely monitoring Tesla’s strategic directions, especially as it navigates the competitive electric vehicle space. With constant adjustments and innovations, the company must effectively counter falling sales numbers and bridging market gaps, especially against technologically advanced rivals.
Tesla's experience encapsulates the multitude of factors influencing stock performance, particularly post-election and influenced by political winds. With strong criticism expected to persist, both from analysts and the market, Tesla's potential recovery remains complex and dependent on its operational adjustments and market strategy.