From Nasdaq:

Tesla, Inc. (NASDAQ:TSLA) shares fell sharply on Monday due to a wider market downturn and the announcement of Model Y price cuts in the U.S. by Tesla. The company’s market capitalization decreased by $17.33 billion, with the stock closing 2.81% lower at $188.13.

Analyst Gary Black feels the stock was hit excessively due to a temporary $1,000 price cut for Model Y vehicles in the U.S., costing the company $65 million in lost profits in 2024. He suggested that traders may be overreacting and discounting further price cuts.

On the other hand, analyst Gordon Johnson of GLJ Research provided a bearish analysis, calculating that a $1,000 price reduction for the Model Y would result in a $298 million impact, equating to a decrease in stock price. He suggested an implied stock move of $5.61 per share, aligning with the drop witnessed on Monday.

Tesla faces challenges ahead with an aging product lineup and limited presence in the affordable segment. Analysts suggest exploring alternative revenue-generating avenues, such as the energy business, to unlock additional value. Potter’s assessment suggests that Tesla’s stock is worth only $135 when considering solely the EV business for valuation.



Read more: Was Tesla’s $17B Monday Meltdown Justified? Bullish Vs. Bearish Analysts Evaluate Model Y Price Cut Impact