Investors appear more concerned than analysts, as the stock has dropped much more than delivery estimates this year - despite more bullish analysts
Shares of Tesla Inc. fell Monday, as analysts and investors continued to express concerns over how many cars the electric-vehicle giant will say they sold over the past few months.
Expectations for first-quarter deliveries, which are expected to be released on Wednesday, have been falling as Tesla faces increasing public backlash over Chief Executive Elon Musk's role in the Trump administration and worries about the impact of tariffs on imported auto parts.
The stock $(TSLA)$ slid 1.7%, to pare an earlier intraday loss of as much as 7.7%. The decline comes after the stock rose 6% last week to snap a record nine-week losing streak, and posted its first weekly gain since the inauguration.
On Monday, Stifel analyst Stephen Gengaro cut his first-quarter delivery forecast by 23%, to 353,418 EVs from 458,672. He blamed the timing of the ramp-up in the production of the new Model Y and the protests against CEO Musk for his reduced outlook.
He also said the highly anticipated rollout of a lower-priced model by the end of June might cause some consumers to hold off on purchases.
Despite the lowered delivery view, Gengaro reiterated his buy rating on the stock. While he trimmed his stock price target by 4%, to $455 from $474, the new target still implies 78% upside from current levels.
"We expect share price volatility to persist in the near term," Gengaro wrote in a note to clients, adding he remains "optimistic" over the medium- and longer-term, as lower-priced vehicle sales and full self-driving in Austin, Texas, kicks in later this year.
Gengaro is the latest bullish analyst to drastically cut their delivery estimate. Earlier this month, Baird's Ben Kallo knocked his estimate down to 315,400 from 369,400.
Last week, even Wall Street's biggest bull, Wedbush's Dan Ives, said he expects a "very soft" delivery number that could be in the 355,000 to 360,000 range. And although Tesla should remain relatively shielded from tariffs, since all of its EVs are assembled in the U.S., Ives said Tesla will still be hurt and forced to raise prices, as a number of parts used to make its EVs are imported.
Despite the lowered outlook, investors have expressed much more concern than the sell-side analysts on Wall Street.
The stock has fallen 13% in March and has tumbled 36.9% year to date. That compares with the S&P 500 index's SPX 6.7% decline this month and 5.6% decline this year.
Meanwhile, the average first-quarter delivery estimate of analysts compiled by FactSet has only slipped by 7.1% this month to 408,000 vehicles. That "consensus" estimate is just 13% below what was expected at the end of last year.
The current average price target of analysts is $358.25, which implies 40.5% upside from current levels. While that target has ticked 0.6% lower from a month ago, it's 21% above where it was three months ago.
The difference in the intensity of investor and analyst concerns has also led the number of bullish analysts to rise. Of the 57 analysts surveyed by FactSet who cover Tesla, 29 (51%) are bullish, up from 27 at the end of March and 26 at the end of 2024.
Cantor Fitzgerald's Andres Sheppard was one of those analysts who flipped to bullish earlier this month. He said the stock had fallen enough that longer-term investors should start buying, as long as they can deal with some volatility over the shorter term.