JPMorgan slashed Tesla’s (TSLA) price target to the Street’s lowest levels so far, citing worst quarterly deliveries in three years. Analyst Ryan Brinkman lowered the price target on Tesla stock to $120 from $135, implying a massive 51.6% downside potential from current levels. Brinkman maintained his “Sell” rating on Tesla stock, while cutting vehicle delivery estimates for Q1 and the full year Fiscal 2025.
The analyst noted that the decision to lower the deliveries arises from the growing backlash on CEO Elon Musk’s political choices and diminishing brand value. Consumers are reacting in “myriad different ways,” the analyst noted, referring to consumer protests at Tesla stores globally, increasing sales boycotts, and a large number of Tesla autos being sold in the second-hand markets.
JPMorgan Cuts Tesla’s Auto Deliveries
Brinkman cut Tesla’s EV (electric vehicle) deliveries for both the first quarter and full year of Fiscal 2025 to address the negative market image. The analyst slashed Tesla’s Q1 deliveries by a massive 20% from 444,000 to 355,000 units, marking the weakest quarter for Tesla’s auto shipments since Q3 of Fiscal 2022. Also, the figure represents an 8% fall compared to Q1FY24 and a 15% decline compared to the December quarter.
For the full year Fiscal 2025, JPMorgan projects Tesla to deliver approximately 1.78 million autos, marginally lower compared to the deliveries of 1.79 million achieved in FY24. The analyst is appalled by the rapidly growing backlash for Tesla and Musk and says he has never seen a company’s brand value fall so drastically in such a short time. In this year alone, TSLA stock has lost 38.6%, erasing all the post-election gains, when Tesla stock had almost doubled by December.
Does Tesla Stock Have a Future?
Musk’s drastic measures to cut expenses as head of the DOGE (Department of Energy Efficiency) committee and his polarizing comments on some European political scenarios have cost Tesla shareholders a rude setback in terms of sales and stock price. Simultaneously, Musk is also losing his footing on the world’s billionaire’s list, since most of his wealth is tied to his stake in Tesla.
Analysts too remain cautious about Tesla’s stock trajectory due to the growing consumer discontent. On TipRanks, TSLA stock has a Hold consensus rating based on 12 Buys, 12 Holds, and 12 Sell ratings each. Also, the average Tesla price target of $331.07 implies 33.5% upside potential from current levels.
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