Tesla shares experienced a minor recovery on Friday, rising nearly 4% during a general market rebound. However, the stock has been on a downward trend for eight consecutive weeks, with some analysts predicting further declines.
Analysts from Wells Fargo and JPMorgan have set price targets significantly below the market average, anticipating that Tesla’s stock could again lose roughly half of its value. These targets are notably bearish compared to the average estimates tracked by Visible Alpha, which are marked at $366.
On Friday, Tesla’s stock closed at $249.98, far from its December peak of nearly $480. This sharp decline has erased the stock’s gains since the November election. The lowered price targets by Wells Fargo and JPMorgan, at $130 and $120 respectively, imply a near 50% drop from Friday’s prices.
Wells Fargo analysts have revised their previous stance, attributing the potential stock decline to political backlash linked to CEO Elon Musk’s previous interactions with the Trump administration. Incidents like recent protests and vandalism of Tesla vehicles have increased risks for potential buyers, affecting sales negatively in major markets like the U.S., China, and Europe.
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Additionally, Tesla’s concern about the Trump administration’s tariff policies was brought to light as the company, along with other automakers, expressed apprehensions to the U.S. Trade Representative’s office. They warned that such policies might provoke retaliatory actions from other nations, which could harm the U.S. automotive industry.
The outlook for Tesla’s stock remains uncertain, with bearish analysts predicting significant losses amidst broader political and economic challenges. While the company’s recent decrease in market value reflects these concerns, future developments in trade policies and political climate could further influence stock performance.
