Mizuho Keeps Tesla PT at $375, Down from $390 Amid Outperform Rating

Mizuho Keeps Tesla PT at $375, Down from $390 Amid Outperform Rating

Tesla stock plummeted nearly 8% on July 7, 2025, after Elon Musk announced the launch of the American Party, a new political movement aimed at challenging both Democrats and Republicans in the 2026 midterms and 2028 presidential race. This sudden shift in Musk's focus has sent shockwaves through Wall Street, with investors expressing concern over his growing political involvement [1].

The stock, which had reached an all-time high of $488 in December 2024 following Donald Trump's re-election, has since fallen 35% to close at $315.35 last week. Monday's drop erased $1.4 billion in value, pushing Tesla shares down to $315.35 [1]. Analysts and investors alike worry that Musk's political distractions could hinder Tesla's core business, particularly at a time when the company is already facing declining sales and missed delivery targets [1].

Musk's new political movement has raised concerns about his ability to manage both Tesla and the American Party effectively. Many analysts, such as Dan Ives from Wedbush, argue that Musk's political involvement is a distraction that investors are growing tired of [1]. Additionally, the potential loss of EV tax credits due to policy changes and Musk's alignment with Donald Trump could pose significant financial risks for Tesla [1].

Mizuho has maintained its price target for Tesla at $375, down from $390, citing concerns over Musk's political distractions and the potential impact on Tesla's business [2]. The downgrade reflects a broader sentiment among analysts that Musk's political involvement is negatively affecting investor confidence in Tesla's future growth.

Despite the recent decline, Tesla's fundamentals remain strong, with the company expected to report solid earnings on July 23. The robotaxi platform and Optimus robot program are seen as potential drivers of future revenue. However, the uncertainty surrounding subsidies, deliveries, and Musk's political future is likely to continue pressuring the stock [1].

References:
[1] https://economictimes.indiatimes.com/news/international/us/tesla-stock-plunges-nearly-8-as-elon-musks-american-party-adds-to-sharp-35-drop-since-december-peak/articleshow/122301401.cms?from=mdr
[2] https://www.mizuho.com/en/