Tesla analysts cut their price targets on the stock

April 10, 2024 at 11:53 AM

Wall Street analysts are cutting their price targets on Tesla's (TSLA) stock. At Piper Sandler, Tesla's price target was cut to $205 from $225; at Jefferies, it was cut to $165 from $185. Both firms also cut their annual sales expectations for the EV maker. Analysts at Bank of America also cut their price target on Tesla shares by $60 to $220 from $280.

Yahoo Finance's Seana Smith and Brad Smith discuss Wall Street's changing tone on Tesla.

For more expert insight and the latest market action, click here to watch this full episode of Morning Brief.

Editor's note: This article was written by Stephanie Mikulich.

Video Transcript

BRAD SMITH: With Tesla's recent volatility, Wall Street is beginning to get a bit concerned. Now, two analysts are expecting a decline in sales with Alexander Potter of Piper Sandler, expecting deliveries to slip half a percent to just shy of $1.8 million vehicles while Philippe Houchois of Jefferies foresees--

SEANA SMITH: Good job on that.

BRAD SMITH: Thanks. I tried. --foresees roughly a 3% drop to $1.77 million. Both analysts also cut their price targets to $205 and $165 respectively here. So, a little bit more bearishness entering the chat here on Tesla right now.

SEANA SMITH: Yeah. Not exactly a huge surprise. We know Tesla has been a massive underperformer, to say the least, since the start of the year, the worst performer within the S&P. We have certainly seen an entire shift just in terms of how investors view this stock and how they have viewed the stock over the last several weeks.

And some of the criticisms surrounding Musk, at least most recently about what he was saying for Robotaxi and what that's going to do with Tesla is that, that's just a sideshow. He's doing everything he can as part of the playbook that we've seen before trying to distract investors from some of the concerning trends that we are seeing in terms of sales and the decline in sales that we could potentially see here in the coming quarters. And he's trying to shift that focus to that next new shiny object. And this could be Robotaxi.

It was interesting what Jefferies had to say about Robotaxi because they did acknowledge that yes, it is helping sentiment, but they do have some doubts surrounding Robotaxi and fundamentally what it's going to do to the investment story at least in the near term. And then you compare that to what we heard from Piper Sandler. You have to put that look on your face.

BRAD SMITH: I mean, this is just an April to forget for Tesla.

SEANA SMITH: Well, yeah.

BRAD SMITH: It started off with--

SEANA SMITH: In 2024 to forget for a day.

BRAD SMITH: Yeah, that's true too. Wells Fargo, they started things off. They saw moderating delivery growth driven by lower demand, diminished return on price cuts, estimating the auto gross margin excluding credits would fall by 130 basis points year over year in Q1. So Yeah, this is not a-- this is not a good year so far.

SEANA SMITH: Not a good year. But Jefferies did point out a silver lining, though, within they say or excuse me, Piper Sandler pointing out that silver lining within their note, saying that they are confident that Tesla is going to be able to overcome demand issues by 2026.

BRAD SMITH: OK.

SEANA SMITH: So, you've got that longer term investment horizon. If you're able to withstand some of the volatility that we could see over the next 18 to 24 months, you could be looking at a strong 2026.

BRAD SMITH: Yeah. As a friend of mine would say, grab a snack and come right back on this name perhaps.

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