Tesla shares fell sharply in early trading Thursday, retreating over 6% to around $254, following a historic surge in the previous session.
The decline came as broader markets also opened lower, with the S&P 500 down 2.2% and the Dow Jones Industrial Average falling 1.9%.
Wednesday’s session marked Tesla’s second-best day on record, with the stock jumping 22.7%.
That rally was only eclipsed by a 24.4% surge on May 9, 2013, when the company posted its first-ever quarterly profit.
The massive gain on Wednesday was driven by President Donald Trump pausing the imposition of full reciprocal tariffs on non-retaliating countries.
The sharp rebound came after a difficult stretch for Tesla, which had lost over 20% since April 2, when President Trump announced sweeping tariffs on imports.
The rebound appeared to reflect a shift in sentiment, with some investors viewing the sell-off as overdone.
However, concerns over the impact of tariffs on economic growth and corporate earnings have continued to weigh on markets.
Automakers, including Tesla, remain under pressure from the potential for higher costs and lower demand.
Why are analysts cutting Tesla’s target price?
Wall Street sentiment toward Tesla is turning increasingly cautious as trade tensions reshape the global automotive landscape.
Analysts from UBS, Goldman Sachs, and Mizuho have all lowered their price targets for the electric vehicle maker, citing mounting risks from tariffs, softening demand, and potential earnings downgrades.
UBS slashed its target to $190 from $225, implying nearly 30% downside from Wednesday’s close, and maintained a Sell rating.
Analyst Joseph Spak noted that Tesla’s earnings expectations remain too elevated and could face further downward revisions after first-quarter 2025 results.
He also flagged potential tariff-related pressure on Tesla’s energy division due to exposure to China.
Goldman Sachs cut its target to $260 from $275, a modest 4% decline from current levels, and reiterated a Neutral stance.
Analyst Mark Delaney highlighted offsetting factors, while concerns over weak auto demand, higher costs from tariffs, and risks to US EV policy persist, he pointed to Tesla’s longer-term AI-related initiatives as a potential cushion.
Mizuho remains the most optimistic among the three. While trimming its target to $375 from $430, the firm still sees about 38% upside and reaffirmed an Outperform rating.
Analyst Vijay Rakesh acknowledged competitive pressures in Europe and China but believes Tesla will retain its lead in the US EV market.
Earlier on Wednesday, Benchmark added Tesla to its “Best Ideas” list on Wednesday, maintaining a “buy” rating on the stock.
The firm also revised its price target downward from $475 to $350 to account for the shift in market sentiment following recent tariff announcements.
Tesla’s Saudi Arabia launch
Tesla, Inc. is entering the Saudi Arabian market, marking a strategic push into one of the world’s most oil-dependent regions.
The move comes despite infrastructure challenges, such as a lack of charging stations across the kingdom’s vast highway network, which remains dominated by internal combustion engine vehicles.
The company will formally launch operations at an event in Riyadh on April 10, followed by the opening of temporary retail locations in Riyadh, Jeddah, and Dammam starting April 11.
Tesla is betting that its success in the nearby United Arab Emirates and a slowly growing interest in electric vehicles across the Gulf region could translate into a foothold in Saudi Arabia.
The timing of Tesla’s entry aligns with a possible visit by US President Donald Trump to Saudi Arabia, the UAE, and Qatar later this month — a trip that, while not officially confirmed, would come amid heightened US engagement in the region.
The post After Wednesday’s record rally, Tesla stock falls 6% today as analysts cut price targets appeared first on Invezz
