Tesla (TSLA) rose to dominance as the face of the electric vehicle (EV) revolution, with Elon Musk at the helm, pushing the limits of technology and innovation. Lately, however, Musk has been making headlines for different reasons, including his growing role leading the Department of Government Efficiency (DOGE). Investors remain wary, and even Musk admits he’s struggling to juggle his many ventures, spreading his focus thin.
As a result, TSLA stock marked its ninth straight week of losses on Friday, March 21.
Intensifying competition from Chinese EV makers is also weighig on shares. BYD Company (BYDDY) has dethroned Tesla in global battery EV sales and unveiled its ultra-fast charging, while Zeekr (ZK) is offering free advanced self-driving tech, leaving Tesla struggling with stalled growth, premium pricing, and an intensifying competitive onslaught.
With rivals outpacing Tesla on price, technology, and innovation, and Musk’s attention stretched thin, could this be a buy-the-dip opportunity or a warning sign of more trouble ahead?
About Tesla Stock
Texas-based Tesla (TSLA) has redefined mobility, automation, and energy, evolving beyond an automaker into a technological force. With a market cap of nearly $800 billion, the automaker stands among the elite Magnificent 7 tech titans.
Yet, storm clouds have gathered. TSLA stock’s 2024 surge, driven by Elon Musk’s political proximity to President Donald Trump, hit a speed bump as European registration data revealed declining demand. Growing scrutiny from European leaders, uneasy with Musk’s polarizing stance, further eroded Tesla’s standing in key markets and investor confidence.
The automaker’s stock has taken the hardest hit among the Mag7 in 2025, plunging 41% in three months as post-election hype has faded and fundamentals weakened. Yet, even after slipping into the red this year, TSLA is still up 60% over the past year.
Tesla’s stock may have hit a speed bump, but its valuation remains sky-high, priced at 93 times adjusted forward earnings and 7.42 times sales. Even after the drop, it towers over sector peers. Yet, for Tesla, this is a relative bargain, trading below its historical averages.
Tesla Misses on Q4 Earnings
Tesla’s high-speed ride journey hit turbulence, missing Q4 and full-year 2024 delivery targets and posting a sluggish Q4 earnings report on Jan. 29. Revenue edged up just 2% year over year to $25.7 billion, missing expectations. Automotive sales slumped 8% as Tesla’s price cuts across its Model 3, Y, S, and X lineup, aimed at revving up demand, backfired. Adjusted EPS of $0.73 climbed a modest 3% but still underwhelmed. Even so, Tesla stayed cash-rich, closing 2024 with $36.6 billion in cash and investments, $8.4 billion in adjusted net income, and $3.6 billion in free cash flow.
The real intrigue, however, lies in Tesla’s roadmap. While skipping concrete fiscal 2025 guidance, it dubbed the year “seminal,” spotlighting advancements in Full Self-Driving (FSD) technology. Tesla’s grand vision is to surpass human driving safety and launch unsupervised FSD and robotaxi services in select U.S. regions. Looking ahead, Tesla is racing to expand FSD (Supervised) into Europe and China by 2025, while AI-powered autonomy remains the centerpiece of its future. Furthermore, Elon Musk is already talking big - calling 2026 “epic” and predicting a “ridiculously good” 2027 and 2028, all hinging on AI, autonomy, and the Optimus humanoid robot.
Analysts tracking Tesla predict 2025 EPS to be around $2.46, up 20.5% year-over-year before surging by another 36% annually to $3.34.
Tesla’s Brutal Slide
TSLA stock is no stranger to stock swings, but 2025 has been particularly brutal. Down nearly 33% on a YTD basis, the once-dominant EV giant is struggling against a relentless wave of competition, leadership distractions, and mounting controversies.
Chinese EV makers, led by BYD and Zeekr, aren’t just catching up – they are outpacing Tesla. BYD’s new charging system adds 250 miles of range in five minutes - twice as fast as Tesla’s best Superchargers. Zeekr is handing out advanced self-driving tech for free, while Tesla still charges a premium. Meanwhile, the global EV market is not growing as fast as expected, and Musk’s once-lofty goal of 20 million annual vehicle sales by 2030 seems increasingly far-fetched as Tesla’s market share shrinks.
It’s not just competition denting TSLA. Musk’s political entanglements and his role with DOGE have alienated some investors and customers. Meanwhile, the threat of a U.S.-China trade war looms large. Tesla’s Shanghai factory is its lifeline, and any retaliation could be devastating.
Then there’s the Cybertruck disaster. Nearly 46,000 units have been recalled – again – after reports of panels flying off on highways. With eight recalls in just over a year, the truck’s futuristic appeal is fading fast. Social media videos of people peeling off Cybertruck panels by hand have gone viral, further embarrassing the brand.
What Do Analysts Expect for Tesla Stock?
Recently, Wedbush’s Dan Ives, a longtime TSLA bull, kept his “Outperform” rating and $550 price target on the EV maker but warned of a “brand tornado crisis.” Musk’s political ties to DOGE, Trump’s cost-cutting agency, are stirring backlash. Ives says Musk must publicly commit to balancing Tesla and DOGE while unveiling clear plans for low-cost EVs and full self-driving. Without action, Tesla risks permanent damage. “Tesla is going through a crisis and there is one person who can fix it … Musk,” the analyst concluded.
TSLA stock has a consensus “Hold” rating overall, but bullish sentiment is rising. Among 40 analysts covering TSLA stock, 15 stand firm with a “Strong Buy” – up from 13 analysts a month back. Meanwhile, three advocate a “Moderate Buy,” 12 advise a “Hold,” and 10 suggest a “Strong Sell.”
Tesla has a mean target price of $338.94, implying 23% upside could be in play. The Street-high target of $550 suggests the stock could rally as much as 100% from the current level.
TSLA’s slide raises red flags, but its long-term vision still sparks debate. With competition fierce, Musk’s distractions growing, and confidence shaken, a rebound is tough. Until Tesla regains focus, this dip may be more of a warning than an opportunity.
