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On Tuesday, Wedbush Securities reiterated its Outperform rating on Tesla stock (NASDAQ:TSLA), currently trading at $228.67, with a steadfast price target of $550.00. This target sits at the high end of Wall Street’s range, with analyst targets spanning from $135 to $550, according to InvestingPro data. The firm’s commentary highlighted the need for CEO Elon Musk to actively lead Tesla during what they describe as a critical time for the company. The firm expressed concern over Musk’s heavy involvement with the DOGE initiative and his close ties with the Trump administration since President Trump’s second term began in January. According to Wedbush, Musk’s preoccupation with these matters has led to his absence from Tesla’s facilities and has negatively impacted the perception of the company, as evidenced by protests at Tesla dealerships and violence against Tesla drivers in various locations across the United States and Europe.
Tesla’s share price has experienced significant strain, with InvestingPro data showing a 44.99% decline year-to-date and the stock currently trading at high earnings and EBITDA multiples. Investors are reportedly losing patience as Musk appears to neglect the company amid these challenging times. According to InvestingPro’s Fair Value analysis, the stock appears to be approaching fair valuation levels after its recent decline. Wedbush analysts believe that Tesla is at a "moment of truth," and that continued focus on DOGE and the Trump administration without attention to Tesla could lead to more extensive brand damage. Current research indicates that less than 5% of Tesla owners would reconsider their purchase due to Musk’s actions, suggesting that the impact on customer loyalty remains limited for now.
Wedbush has seen similar situations with Musk in the past and notes that he has historically risen to the occasion for Tesla’s shareholders. Despite near-term challenges and downward revisions in Street projections for 2025, Wedbush remains optimistic about Tesla’s medium and long-term innovation prospects. InvestingPro data reveals Tesla maintains strong financial health with more cash than debt on its balance sheet and liquid assets exceeding short-term obligations. For deeper insights into Tesla’s financial health and 20 additional ProTips, subscribers can access the comprehensive Pro Research Report available on InvestingPro. The firm emphasizes the importance of the upcoming months for Musk to navigate the turbulence and shape the future narrative for Tesla.
In other recent news, Tesla’s financial outlook has been notably adjusted by UBS, which cut the company’s stock price target from $259 to $225 while maintaining a Sell rating. This revision follows a lowered delivery forecast for the first quarter of 2025, with expectations now set at 367,000 vehicles, down from an initial estimate of 437,000. The adjustment reflects a 5% year-over-year decline and a 26% quarter-over-quarter drop, positioning it 13% below the current consensus from Visible Alpha. UBS’s analysis also points to low delivery times for Tesla’s Model 3 and Model Y, indicating weaker demand. Additionally, Redburn-Atlantic has maintained its Sell rating on Tesla with a $160 price target, citing concerns over stagnant sales volumes and potential financial strain from increased inventory and possible U.S. tariffs on imports from Mexico. The firm has lowered its fiscal year 2025 earnings per share forecast by 5% due to these factors. The recent developments underscore a challenging outlook for Tesla, as analysts express concerns over demand and financial pressures.
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