April 2,Wells FargoThe latest research report was released on Tuesday, announcing theTeslaThe stock rating was downgraded from neutral to underweight, and the target price was slashed in half to $130, a 51% drop from Tuesday's closing price of $268.46. Colin Langan, the bank's star analyst, and his team continue to forecast a decline in Tesla's delivery growth and expect price cuts to impact the company's margins. Tesla stock has been added to Wells Fargo's list of tactical ideas given the potential slide in the stock price.
The report pointed out that as the penetration rate of electric vehicles in the United States and Europe approaches saturation and the price war between Chinese local brands intensifies, Tesla has lacked effective means to stimulate sales in the short term. In particular, it warned that if the Biden administration cuts the electric vehicle tax credit policy by $7,500 in the second half of the year, it will further suppress demand.
In response to competition, Tesla's global price reduction strategy is eating profits. The bank predicts that earnings per share (EPS) in 2025 will plummet by 25% year-on-year, and gross profit margins may fall below the key support level of 20%, more than half from last year's historical high of 31%.
Regarding the Robotaxi driverless taxi business that Musk has high hopes for, the report raises sharp questions: the Autopilot system, which relies entirely on visual solutions, has major security vulnerabilities, and the delivery of the Cybertruck mass-produced at the Austin Gigafactory has been delayed many times. Langen particularly emphasized that if a commercial fleet cannot be formed before June, market confidence may be severely damaged.
It is worth noting that although Tesla's stock price bucked the trend and rose 6.2% on Tuesday, it still fell 37% during the year, which is nearly 40% lower than last year's historical high of $488.54.
Comments