Tesla Stock Hits Lowest Since January on Analyst Downgrade

Tesla’s stock plunged to its lowest level since January, driven by a downgrade from Deutsche Bank analysts criticizing Tesla’s shift away from its core electric vehicle business. The stock fell 3.5% to below $150, marking its lowest closing price since January 2023.

The downgrade came from a Deutsche Bank group led by Emmanuel Rosner, who downgraded Tesla from a buy to a hold and slashed its price target by 35% to $123, anticipating further downside of 19%. Rosner cited concerns about delays for Tesla’s less expensive Model 2 car and the company’s focus on developing robotaxis, an early-stage ride-hailing network of autonomous vehicles. He warned that this shift could create significant earnings pressure in the coming years.

Rosner also highlighted the risks associated with Tesla’s robotaxi plans, cautioning that the technology may not be ready despite CEO Elon Musk’s announcement of an unveiling on August 8. Rosner emphasized that the timeline for the technology’s deployment could be years away, leading to further downward pressure on Tesla’s share price.

Tesla’s stock has now declined by 40% year-to-date, significantly underperforming the S&P 500 and Nasdaq, which have seen gains of 6% and 7% respectively. The downturn in Tesla’s stock comes amid a challenging period for the electric vehicle industry, with other companies like Rivian and NIO also facing steep declines in their stock prices.

The industry as a whole is grappling with global demand challenges, leading Tesla to adopt a cash preservation strategy, including a recent announcement of a more than 10% reduction in its workforce. Tesla’s recent struggles mark a significant shift for a company once known for its explosive growth, signaling a challenging road ahead for the electric vehicle giant.