Tesla Shares Fall After Mizuho Cuts Price Target

Tesla Inc. (NASDAQ: TSLA) experienced a significant drop in share prices on Monday, falling nearly 5%. This decline came after analysts at Mizuho downgraded their price target for the electric vehicle manufacturer from $515 to $430, leading to market reactions that have raised questions.

Economist Peter Schiff took to social media to express his confusion over the negative market reaction, suggesting that the situation might not be as bleak as it appears. Schiff pointed out that even with the reduced price target, it is still approximately 80% higher than Tesla's closing price of around $238 on Monday. "But why is this even bad news if the lowered price target is still 80% higher than today’s closing price?" Schiff asked on X.

The downgrade from Mizuho was driven by concerns about weakening demand for Tesla vehicles. The analysts adjusted their delivery forecasts, lowering this year's estimate from 2.3 million to 1.8 million vehicles, with a similar reduction for 2026, reducing the forecast from 2.9 million to 2.3 million vehicles. According to reports, Tesla has notably struggled in markets including the U.S., China, and Europe, where the company has been described as having underperformed last month.

Mizuho further noted that the electric vehicle maker is facing challenges related to a "deterioration in geopolitics" and a changing public perception of the brand. Issues surrounding Elon Musk‘s activities, particularly his involvement with the Trump administration’s Department of Government Efficiency, have reportedly sparked protests and incidents of vandalism against Tesla cars and showrooms.

Investor sentiment towards Tesla has been observed to be eroding, as highlighted by Dan Ives, an analyst from Wedbush Securities. He has mentioned that investor patience is wearing thin, particularly due to Musk's recent absence from major Tesla facilities, with reports that he has not been seen at any manufacturing plant in the past two months.

Adding to the current unease among Tesla investors, Ross Gerber, a long-time supporter of the company, shared a video showing protests outside a Tesla store in Santa Monica. The video even featured his young child expressing relief that they do not own a Tesla, further illustrating the shifting sentiments towards the brand.

Since reaching a peak price of $479.86 in December, Tesla's shares have lost about half their value, emphasizing the volatility the company is currently facing in the market. Despite the gloomy outlook from Mizuho, the consensus price target for Tesla among 30 analysts remains at $318.22, with estimates ranging from a high of $550 to a low of $24.86. The average rating from recent analysts, including Canaccord Genuity and Wells Fargo, stands at $321.33, suggesting a potential upside of 36.1% from the current price.

Benzinga Edge Rankings assesses stocks based on various criteria such as momentum, value, growth, quality, and price trends. For those interested in understanding how Tesla performs according to these metrics, they can consult the evaluations provided.

Tesla, Stocks, Investment