From Nasdaq: 2025-06-09 00:45:00

Tesla Inc. (NASDAQ: TSLA) saw a 14% drop in stock price, now trading at $285, down from highs above $350. Revenue growth slowed to 1% in the last 12 months, with net margins falling to 2% in Q1 FY2025. Political uncertainties and competition from Chinese EV makers add pressure, raising concerns about demand erosion.

If Tesla’s revenue continues to decline and net margins shrink further, EPS could fall below $1.00, leading to a re-rating of the stock. A downside scenario suggests a potential drop to $30 or even $75 per share. Recovery could come from product expansion and stabilization of revenues, with an upside potential to $400+ if earnings rise.

Despite risks, Tesla remains a dominant player in the EV market. However, the current valuation is based on substantial growth, despite warning signs in recent earnings. An uncertain risk-reward skew suggests a potential rational decline towards $150. Investing in a diversified portfolio like the Trefis High Quality (HQ) Portfolio may offer more stability and outperformance compared to single stock investments.



Read more at Nasdaq: Can Tesla Stock Fall to $150?