Tesla Inc.'s stock has witnessed significant volatility recently, prompting both speculation and cautious optimism among investors. Having experienced a steep decline of 22.75% in early 2025, the company has seen approximately $353.97 billion wiped off its market capitalization. This downward trend has not dimmed the confidence of CEO Elon Musk, who is still predicting ambitious gains for the company’s stock.
One of Musk's more audacious forecasts suggests the stock could see a remarkable 1,000% rally over the next five years, potentially driving prices to about $2,930, equivalent to approximately Rs 2.5 lakh. “It will require outstanding execution, but I think more like 1000% gain for Tesla in 5 years is possible,” Musk stated, expressing his belief during discussions around the company's performance.
Despite Musk's optimism, analysts and investors are raising concerns about the challenges facing Tesla. The stock initially soared to heights above $479.86 during December 2024 but has since suffered considerably, reflecting broader market sentiments following Donald Trump’s return to presidential politics. Notably, the market capitalization dropped from $1,296.35 billion to just $942.38 billion as of February 28 this year, as reported by financial analysts.
Ross Gerber, president and CEO of Gerber Kawasaki Wealth & Investment, warned of potential worsening conditions for Tesla. He stated, "The decline could become steeper... Tesla has become the target for 'all the anti-Elon anger out there,'" highlighting the risks surrounding Musk's political affiliations and the backlash from different groups.
This backlash has materialized during nationwide protests dubbed the “Tesla Takedown,” where demonstrators have taken to the streets to voice their opposition to Musk’s policies, particularly following substantial government workforce cuts. Recent reports indicated nine arrests during these protests, emphasizing rising tensions within communities helped by Tesla's earlier promises of growth and innovation.
On the technical analysis front, Tesla’s stock appears to be trading below its eight-day, 20-day, and 50-day moving averages, indicating bearish sentiment among traders. Closing at $292.98, the stock is still above its 200-day moving average of $278.76. The analysis suggests potential support at this level, but weaker momentum indicators signal caution moving forward.
The moving average convergence divergence (MACD) reading of negative 25.31 and the relative strength index (RSI) at 30.60 suggest the stock may be nearing oversold conditions. Investor sentiment reflects caution; the stock has dropped 22.75% year-to-date but boasts impressive growth of 55.72% over the past year. Nevertheless, analysts remain skeptical, with average price targets hovering around $336.19, which suggests only modest upside potential.
Despite the negativity, some analysts argue there is still value to be found within Tesla. Estimates from different rating agencies, including Benchmark and Stifel, suggest modest potential recovery, pointing to around 10.26% potential upside at most. With such divergent views present, the environment remains one of uncertainty.
Tesla's stock performance has become emblematic of broader market trends, reflecting investor anxiety and the impact of political dynamics on high-stakes companies like Tesla. With Musk’s return to the helm of the White House shaping opinions and stirring action among the public, how Tesla's stock will navigate through the storm remains to be seen.
While Musk’s ambitious projections clash with harsh market reality, the coming months will be pivotal. Investors are left to speculate whether Musk can leverage his innovative potential to turn things around for Tesla amid widespread skepticism and growing opposition. The future of Tesla’s stock will hinge not only on market conditions but also on how well Musk can manage corporate image and execution strategy moving forward.