Trump's tariffs cause Tesla shares to drop 5%, uncertainty looms

From Nasdaq: 2025-02-04 10:53:00

President Donald Trump’s tariff orders hit Tesla shares hard, with a 5% drop in S&P 500. Tesla’s CFO acknowledges the impact of tariffs on the company. Tesla’s EV business faces challenges with declining sales and missed earnings estimates. The future looks uncertain for Tesla amid global macro headwinds and competition.

Musk’s bold claims on AI and AVs aim to drive Tesla’s future growth. However, analysts view these claims skeptically. Tesla’s success in 2025 hinges on delivering unsupervised FSD and AI technology. The company’s financial performance depends on its core EV business amidst growing competition and affordability concerns.

Tesla’s energy generation and storage business show strong growth potential. The company aims to capitalize on the global energy transition with its Megapack products. However, Tesla’s stock is considered overvalued based on its price/sales ratio. Analysts advise caution when considering investing in Tesla at this time.

Investors should be cautious with Tesla due to near-term headwinds and uncertainties. Musk’s focus on long-term potential may not align with current market conditions. Analysts are losing confidence in the stock, leading to a Zacks Rank #5 (Strong Sell) rating. Tesla’s future success remains uncertain amidst industry challenges.



Read more at Nasdaq: Trump’s Tariffs Hit TSLA Hard, Shares Fall 5%: What’s Next?