The Reasons Some Tesla Bears Believe the Stock May Drop Nearly Half
Amid a general market recovery, Tesla’s stock increased about 4% on Friday. However, the company reported losses for the eighth week, and some Wall Street analysts anticipate more drops. According to JPMorgan and Wells Fargo experts, the stock may drop by around half in value once more since it peaked in December. Wells Fargo and JPMorgan’s targets are incredibly pessimistic and far lower than the average of analysts that Visible Alpha tracks.
Despite a general market recovery, Tesla (TSLA) shares increased by about 4% on Friday. However, the company reported losses for the eighth consecutive week, and several experts predicted that the price would continue to decline.
The stock has lost over half its value since its closing top of $479.86 on December 17 and has given up almost all of its gains since the election on November 5. Wells Fargo and JPMorgan analysts reduced their price estimates to $130 and $120 this week, indicating that the stock may drop by almost half from Friday’s closing of $249.98.
The revised price estimates from JPMorgan and Wells Fargo analysts are incredibly pessimistic; they are much below the $366 average of analysts monitored by Visible Alpha, which would indicate a nearly 50% premium over Friday’s pricing.
Analysts at Wells Fargo stated that they “initially dismissed” concerns that the EV manufacturer would suffer from political backlash against CEO Elon Musk’s ties to the Trump administration. However, recent demonstrations and reports of vandalism against Tesla vehicles have called into question that, stating that they “raise the stakes for potential purchasers.” They emphasized dwindling sales in Europe, China, and the United States.
According to allegations surfaced on Friday, Tesla was among several automakers that expressed their worries about the Trump administration’s tariff policies to the office of the U.S. Trade Representative. According to letters from Tesla and other automakers, the taxes may cause other nations to retaliate, which would be detrimental to the American auto sector.
