Tesla Stock Analysis: Analyst Predicts Rebound Despite Recent Challenges
Tesla stock (NASDAQ: TSLA) has faced significant challenges recently, with CEO Elon Musk’s involvement in the United States Government, tariffs, and lower-than-expected delivery figures impacting the stock price. Despite these obstacles, one analyst believes that the concerns surrounding Tesla’s short-term performance are exaggerated.
According to Mickey Legg, an analyst at Benchmark, the negative narrative surrounding Tesla shares is overblown. Despite a 32 percent drop in share price since the beginning of the year, Legg encourages investors to focus on the future catalysts that lie ahead for the company.
In a note to investors, Legg stated, “We believe the recent stock pullback and sales declines, while significant, are overblown considering the near-term issues impacting the company and the scope of opportunities around the corner.”
One of the key factors contributing to the stock’s decline is Musk’s involvement with the Department of Government Efficiency (DOGE), which has raised concerns about his focus on Tesla. However, Musk’s role with DOGE is expected to come to a close, which could positively impact Tesla’s stock performance.
Additionally, Tesla has announced plans to launch affordable models in the first half of the year, which could help boost vehicle sales. The company is also set to introduce Tesla-operated robotaxis as a paid service in Austin, TX, with potential for expansion to other cities.
Legg believes that a reduced role for Musk in the government could lead to a stock rebound. He stated, “Recent headlines suggest Musk could be reducing his role with the White House, and we can see political backlash diminishing as the year progresses. In our view, there is significant potential for a stock rebound, and we believe the breadth of near-term opportunities outweigh headwinds.”
Despite the recent challenges, Tesla shares have shown a positive trend, with a 20 percent increase as of 3:22 p.m. on the East Coast.