GLJ Research Analyst Lowers Tesla's Price Target, Maintains Strong Sell Rating

GLJ Research's Gordon Johnson lowered their price target on Tesla (NASDAQ: TSLA) by 2.8% from $23.53 to $22.86 on 2024/04/16. The analyst maintained their Strong Sell rating on the stock.

According to Johnson, the reason behind the downward revision in price target is Tesla's disappointing performance in the first quarter of 2024. The company delivered 95,000 fewer vehicles compared to the previous quarter, Q4 2023. This significant decline in deliveries has raised concerns about Tesla's growth trajectory.

Furthermore, Johnson expects Tesla's average selling price per vehicle to decline by $2,000 in the first quarter, resulting in a revenue decline of $5 billion. This projected decrease in revenue highlights the challenges the company is facing in maintaining profitability.

Looking ahead, Johnson pointed out that Tesla's announcement of layoffs indicates a downward revision in their delivery estimates for the second quarter. GLJ Research's previous estimate of 425,000 deliveries has now been revised to 405,000. Johnson believes that the current consensus estimates for Tesla's deliveries are "too high."

The analyst rating landscape for Tesla is mixed, with 50% of top-rated analysts currently rating the stock as a Strong Buy or Buy. Meanwhile, 40% see it as a Hold, and 10% either recommend or strongly recommend selling the stock. This divergence in opinions among analysts reflects the uncertainty surrounding Tesla's future performance.

In terms of earnings per share (EPS) forecasts, the consensus among analysts is that Tesla's upcoming year will deliver a figure of $5.43. If these analysts' predictions hold true, it would represent a year-over-year increase of 14.8% in Tesla's EPS.

Looking at Tesla's stock performance, it has experienced a significant decline since its last quarterly report on December 31, 2023. The stock price is down 36.8% during this period. On a year-over-year basis, Tesla's stock is down 16%. This underperformance compared to the broader market is evident when comparing it to the S&P 500, which is down 21.7% during the same timeframe.

Gordon Johnson, the analyst behind the recent rating and price target revision, is ranked in the top 15% of Wall Street analysts by WallStreetZen. With an average return of 11.5% and a win rate of 61.4%, Johnson specializes in analyzing stocks in the Technology and Basic Materials sectors.

Tesla, Inc. is a renowned electric vehicle manufacturer that operates globally. The company designs, develops, manufactures, leases, and sells electric vehicles, as well as energy generation and storage systems. Tesla's product offerings include sedans, sport utility vehicles, and energy generation and storage products. The company also provides after-sales services, including vehicle insurance and financing options.

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