TechFlow news — On March 12, according to Jinshi News, Tesla's stock price has plunged 52% from its all-time high in mid-December 2024, and even the high-profile support from U.S. President Trump has failed to reverse market sentiment. After Trump purchased a red Model S for the White House on Tuesday, Tesla shares rebounded 3.8% following Monday’s 15% plunge. However, investors fear the downturn is far from over, as Tesla has now erased all gains made since the post-election rally.
Brian Mulberry, client portfolio manager at Zacks Investment Management, said: “This stock is now trading purely on sentiment, and downward pressure is clearly dominant. In the short term, it could easily fall to $200 or even lower.” In the past week alone, at least four analysts have downgraded Tesla’s price target, while two previously bullish analysts have issued warnings over weak sales performance.
Tesla faces multiple challenges: no near-term updates expected for Full Self-Driving or robotaxi programs; Musk’s divided attention due to his work with the Department of Government Efficiency; Republican opposition to EV policies; declining global sales; and reputational damage caused by Musk’s political involvement. Despite retail traders having net purchased $2.8 billion worth of Tesla stock since last Tuesday, market confidence remains weak.
As of Monday’s close, Tesla’s forward P/E ratio stood at 75 times, significantly higher than the average of 25 times for the tech “Magnificent Seven” and 20 times for the S&P 500 index. Options markets indicate that one-month implied volatility has reached its highest level since late 2022, when Tesla’s share price had dropped to around $100.
