Shares of electric vehicle (EV) giant Tesla (NASDAQ:TSLA) continue to be in the news. In a recent development, TSLA stock closed 4.9% higher on Monday as investors reacted positively to the announcement that the company will unveil its Robotaxi on August 8.
Despite this optimism, the company faces challenges such as declining demand for EVs and increased competition. This is evident through its weaker-than-expected Q1 delivery numbers. To add to investors’ pain, Tesla is among the worst-performing S&P 500 (SPX) stocks so far this year. TSLA stock has lost over 30% of its value year-to-date, underperforming the S&P 500’s nearly 9% gain.
Tesla Settles Autopilot Lawsuit
In separate news, Tesla has come to an agreement with the family of a driver who lost his life in a tragic accident in 2018, involving the company’s Autopilot feature. This settlement was finalized just before attorneys were set to deliver their opening statements, the Wall Street Journal reported.
While the settlement terms were not disclosed, it ended years of legal proceedings. Tesla, known for its advanced driver assistance systems like Autopilot and FSD Capability options, faces considerable product liability claims due to these features, resulting in various legal and regulatory risks. However, the company has been making efforts to effectively manage its risks. Notably, Tesla’s legal and regulatory risks constitute 17.5% of its total risks, which is slightly below the sector average of 18%.
Is Tesla a Buy, Sell, or Hold?
Given the near-term demand headwinds and pressure on margins, Wall Street remains sidelined on TSLA stock. It has nine Buys, 19 Holds, and seven Sell recommendations for a Hold consensus rating. The average Tesla stock price target of $196.72 implies about 13.72% upside potential from current levels.
