Since July 2023, TSLA has been in a crazy downward trend. Now, TSLA is starting to decline again, and negative sentiment in the market is also increasing. Is Tesla at a dead end? Or will we all miss out on Tesla's massive rebound at the most unexpected moment?

To find the answer, we need to first examine whether Tesla's current predicament is temporary.

The increasingly fierce competition in the electric vehicle (EV) market is one of the reasons for the current loss of confidence. This sounds counterintuitive, as Tesla was once an undisputed leader in the field of electric vehicles. However, other car manufacturers have been investing heavily in the development of electric vehicles. Therefore, Tesla's market share is also continuously declining, and its dominant position is no longer as stable as before. However, this does not mean that Tesla has reached its end.

The overall economic environment is another factor that puts pressure on Tesla's stock price. The US economy is facing fiscal challenges, including rising inflation, rising interest rates, and supply chain disruptions. Faced with such a problem, consumers are unlikely to spend money on luxury goods like Tesla, which puts pressure on Tesla's profits.  

Tesla CEO Elon Musk's actions have also caused concern among investors. As is well known, Musk's remarks are bizarre and his behavior is impulsive, and investors are concerned that this will damage Tesla's reputation and prospects. It is currently unclear where Tesla will go. However, supporting emotions are like a fickle beast: they come fiercely today and disappear tomorrow.

Given that the factors that are putting pressure on Tesla's stock price may continue to exist, Tesla's stock price may further decline. Although some of the issues affecting Tesla are only temporary, they will not change in the short term. For Tesla and its stock price, 2024 will be a tough year.

The excerpt from the article in Barron's Weekly below clearly illustrates this point.

Tesla's stock price is falling and should be sold immediately. The analyst said so.

Author: AL ROOT | Updated on January 31, 2024 at 07:47 AM Eastern Time

Tesla's stock price fell in early Wednesday trading due to the Delaware court announcing CEO Elon Musk's decision on Tuesday eveningSalary PlanInvalid, the compensation plan grants Musk approximately 300 million performance-based options.

If Tesla's market value reaches $650 billion (as it has in the past), then this ruling essentially abolishes Musk's 2018 compensation plan worth approximately $56 billion, which could have a wide-ranging impact on other businesses in the United States.

Carl Tobias, Williams Professor of Law at the University of Richmond, stated that Judge Kathaleen McCormick is critical of Tesla's corporate governance. This is an important corporate governance precedent

Tesla stock in pre-market trading on WednesdayMedium decline of 2.8%The Nasdaq Composite Index futures fell 1.3%. In the past month, Tesla's stock price has fallen by 19.7%, while the S&P 500 Index and Nasdaq Composite Index have risen by 4.6% and 6.3%, respectively.

Baird Company AnalystBen KalloIn a report on Wednesday, it was stated that "this ruling has put pressure on Tesla's stock price." Tesla's board of directors must take action. If it weren't for this salary, Musk would have been working for the company for nothing in the past few years. Kallo expects Musk to file an appeal.

Kallo also wrote, "In addition to the pressure that the ruling on the compensation plan will put on Tesla's stock price, we have also found that due to the interruption of Red Sea shipping and its impact on Tesla's European Gigafactory production, Tesla's delivery quantity in the first quarter is facing risks. We still believe in the long-term development of Tesla's stock price, but think it will decline in the near future

According to FactSet data, Wall Street expects Tesla to deliver approximately 494000 vehicles in the first quarter, higher than the approximately 485000 vehicles delivered in the fourth quarter of 2023.

Kallo has designated Tesla stock as a 'bearish option'. At Baird, the name "New Selection" is used to represent the current viewpoint. Kallo believes that Tesla's stock price is currently declining. Despite giving a "buy" rating and a target price of $300, Kallo is still bearish on Tesla.

Kallo has no bearish target. If the stock falls, Kallo only needs to remove the "newly selected" tag in another report.

After the opening on Wednesday, Tesla's stock priceFar lower than the 52 week high set last summer299.29 US dollars. Tesla's stock price performed better than some competitors on Wednesday, such as Lucid Group's stock price falling to $3.45, a decrease of 0.3%, and NIO's stock price falling to $5.67, a decrease of 2%; BYD's stock price fell 2% during the Hong Kong trading session. General Motors' stock price rose to $38.09, an increase of 0.1%.

Tesla's trading volume on Tuesday was 105.7 million shares, 12 million shares lower than its 50 day daily average trading volume of 117.7 million shares.

Kallo rated Tesla's stock as' buy '. Overall, 38% of Tesla stock analysts give a buy rating, with an average target price of approximately $217. The average buy rating of the constituent stocks of the S&P 500 index is about 55%.

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