The analysts at Stifel decreased Tesla’s (TSLA) target valuation to $474 although they kept the stock rating at Buy. Tesla provided three main reasons for their pricing readjustment which include a combination of mixed Q4 performance and present pricing complications and brand image problems. The uncertain state of the Trump administration along with growing Chinese automaker competition leads the analysts to a conservative viewpoint.

The company achieved historic minimum Q4 unit cost of goods sold while planning to introduce a budget-friendly vehicle during early 2025. The company’s production scale-up of Optimus along with promising energy storage prospects and the June release of FSD operate as main drivers for growth.

The company encounters ongoing pricing challenges at the same time as brand recognition reached historical minimums thereby creating potential negative effects on upcoming sales. Stifel attributes this decline in perception partly to CEO Elon Musk’s political involvement. According to the firm Tesla must manage competition arising from Chinese EV manufacturers as a primary market hurdle.