Tesla stock notched another grim milestone Friday, extending stock year-to-date dive to over 40%, and there remains plenty of cause to remain highly c

Tesla Shares Are Officially Down 40% This Year—Here’s Why The Stock Could Fall Further

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2024-04-25 06:00:05

Tesla stock notched another grim milestone Friday, extending stock year-to-date dive to over 40%, and there remains plenty of cause to remain highly cautious about the stock in the near term even as it grows cheaper.

Tesla’s 2% loss to about $147 per share Friday, spurred by the company recalling all 3,878 Cybertrucks on the road, was its sixth consecutive day of a more than 1% loss and sent its share price to 65% below its split-adjusted November 2021 peak of over $400.

It’s now the cheapest it’s been since last January to buy Tesla stock, but there’s plenty of negative catalysts behind the steady losses.

Tesla’s nightmarish start to the year saw its January earnings reveal significant misses for both sales and profits; a 9% year-over-year decline in first-quarter vehicle deliveries, far short of forecasts of 7% growth; and comes ahead of the company’s first batch of 2024 financial results Tuesday, which analysts expect to reveal a 5% year-over-year slip in revenues and a 42% drop in profits, according to consensus forecasts compiled by FactSet.

Aside from the bad headlines, what makes Tesla stock still a difficult bet? Simply put, Tesla is still valued like a growth stock—but it’s not growing and isn’t expected to grow in the near term.