Tesla (NASDAQ: TSLA) shares took a steep dive on Monday, dropping more than 15% to close at just over $222—the lowest level since late last year. The electric vehicle giant emerged as the S&P 500 biggest decliner, kicking off the week on a sour note and extending a seven-week losing streak. The stock has now shed over half its value since hitting a record high of $479.86 on December 17, erasing all gains made after President Donald Trump’s election win in November.
The downturn slashed Tesla’s market capitalization to about $840 billion, per Visible Alpha data, amid a broader sell-off in equity markets. Since Trump took office, CEO Elon Musk has been working with the Department of Government Efficiency to trim federal spending. However, instead of lifting Tesla’s stock, this stretch coincided with a sharp decline.
Several factors are weighing on Tesla. A disappointing fourth-quarter deliveries and earnings report has rattled investors, while uncertainty looms over Trump’s proposed tariffs. Sales in China have weakened, and registrations have slipped in Europe to start the year. Some market watchers speculate that Musk’s high-profile role in the Trump administration might be hurting Tesla’s brand appeal and sales, though opinions remain split.
Analysts are divided on Tesla’s (NASDAQ: TSLA) outlook. Of the 19 brokers tracked by Visible Alpha, 10 rate the stock a “buy,” five say “hold,” and four stick with “sell.”
UBS analysts, for instance, reaffirmed their “sell” rating on Monday, trimming their price target from $259 to $225. They also slashed their first-quarter delivery forecast to 367,000 vehicles from 437,000, citing softer-than-expected demand for the new Model Y. While UBS sees the Model Y refresh and a yet-to-be-announced lower-cost model as potential sales boosters, they caution that demand for the new Model Y appears “somewhat muted” so far and expect a lower-cost vehicle to carry slimmer profit margins.
