


Topline
Tesla earned a new analyst downgrade in the wake of last week’s stunning showdown between the formerly close allies in Tesla CEO Elon Musk and President Donald Trump, as the stock continues to face pressure from Musk’s activities outside of his executive duties.
Skepticism about Tesla’s upcoming robotaxi rollout also fueled the analysts’ cooling optimism.
In a Monday note to clients, Baird analysts led by Ben Kallo cut their rating for Tesla stock from buy to neutral, cutting his share price target for the automaker 14% from $370 to $320, still above Tesla’s $297 ticker Monday.
Kallo partially attributed his waning optimism on Tesla to last week’s spar between Musk, the richest person on Earth and the top GOP donor in the 2024 election cycle, and Trump, who said Musk “lost his mind” after the centibillionaire went after Trump, most explosively suggesting the president was in some way connected to the late Jeffrey Epstein’s criminal activities.
Musk’s “relationship with President Trump has been a positive, but now adds uncertainty and fuels questions regarding brand damage” for Tesla, explained Kallo.
Also driving the downgrade was skepticism on Tesla’s looming robotaxi launch meeting expectations.
The Baird group noted it forecasts just 6,000 of the driverless cabs will be on the road by the second half of next year, a fraction of the “hundreds of thousands” Musk recently predicted, though Kallo expressed optimism about Tesla’s “outsized opportunity” in robotaxis and robotics.
Musk’s “ties to the government are a double-edged sword” for Tesla, according to Kallo, who noted Tesla stock’s big runup following Trump’s victory “despite deteriorating fundamentals” in its core electric vehicle business.
To that end, Tesla stock is up 17% since Election Day, trouncing the S&P 500 yardstick’s 5% return. That outperformance came even as Tesla’s underlying financial and vehicle sales were exceptionally weak. Tesla’s first-quarter vehicle deliveries grew at their worst annual pace on record, while its revenue came in at its lowest level since Q2 2022 and its net profit was its weakest since Q4 2020. Analysts pointed to the polarizing nature of Musk’s right-wing political activity, headlined by his $288 million in donations to Trump and affiliated U.S. election efforts, as a key catalyst for this slump, as sales across western Europe and Democratic strongholds including California cratered in early 2025. Last week, Goldman Sachs analysts predicted Tesla’s vehicle deliveries this quarter would fall at a record 18% pace compared to the same period last year.
Wedbush analyst Dan Ives, one of the most outspoken voices covering Tesla and often among the most bullish, maintained Monday his Wall Street-leading $500 price target for Tesla. Ives wrote to clients he still anticipates the Trump administration will “fast track” key regulatory hurdles for Tesla in its robotaxi push “despite the Musk beef.” Musk “needs Trump for many reasons, including a green light on a federal framework” for autonomous driving, explained Ives.
More than $20 billion. That’s how much poorer Musk is since last Wednesday, just before his clash with Trump reached a fever pitch. Musk is still worth a world-leading $394 billion, according to Forbes’ calculations.