Tesla Stock Has Crashed 50% and Investors Just Got Bad News From One of Wall Street's Biggest Bulls

The Tesla story has long been a tale of visionary ambition and turbulent execution. But in early 2025, the company’s stock is reeling—not just from weak sales and regulatory hurdles, but from a stark reversal in sentiment from one of its most vocal supporters. Wall Street’s optimism is fading fast, and the numbers tell a stark story: Tesla’s stock has plummeted nearly 47% from its December 2024 peak, hitting $242.41 by mid-April. Even bulls are now sounding alarms.

The Downgrade Tsunami

The sell-off gained momentum after Wedbush analyst Dan Ives, a longtime Tesla bull, slashed his price target from $550 to $315—a 43% reduction—citing “brand damage” from Elon Musk’s political entanglements and rising competitive pressures. Ives estimates Tesla has already lost 10% of its future customer base due to Musk’s divisive role in the Trump administration’s Department of Government Efficiency (DOGE). This shift is particularly alarming because Ives had previously defended Musk’s vision, calling Tesla “the Apple of the automotive world.”

But Ives isn’t alone. JPMorgan downgraded Tesla’s price target to a brutal $120, citing 13% year-over-year delivery declines in Q1 2025 and fears that U.S. tariff policies could erode margins further. Meanwhile, Goldman Sachs and Wells Fargo cut targets to $260 and $130, respectively, as macroeconomic headwinds and trade tensions take their toll.

The Math Behind the Meltdown

Tesla’s struggles are baked into its financials. Key metrics paint a grim picture:
- Sales Slump: Deliveries fell to 336,681 units in Q1 2025, marking the first annual decline since 2011. Europe and China saw catastrophic drops—76% in Germany and 49% in China—as competitors like BYD and Waymo undercut Tesla on price and innovation.
- Margin Squeeze: Aggressive 2024 price cuts to boost demand backfired, sending EPS plummeting 53% to $2.04. Tesla now trades at a P/E ratio of 122.36, nearly six times the S&P 500 average, despite deteriorating fundamentals.
- Regulatory Headwinds: Musk’s political stance has alienated progressive buyers, while U.S. tariffs on Chinese-made batteries and components are inflating costs.

The Crossroads: Bulls vs. Bears

Bulls cling to Tesla’s long-term vision: its Full Self-Driving (FSD) platform and Cybercab robotaxi could unlock a $1 trillion opportunity by 2030, they argue. Optimism also persists around energy storage and services, which are projected to drive 17.5% revenue growth to $117.2 billion in 2025.

But bears see a company overextended. Delays in autonomous driving approvals, rising competition from Chinese automakers, and Musk’s focus on side projects like Optimus robots—still unproven revenue streams—add to the risks. Barclays now forecasts 1.95 million deliveries in 2025, well below Tesla’s internal targets and the Bloomberg consensus of 2.08 million.

Conclusion: A Volatile Path Ahead

Tesla’s stock sits at a precarious crossroads. While the median analyst target of $305.93 suggests modest upside, the risks are existential. A $120 price target from JPMorgan underscores fears of valuation collapse if deliveries continue to stagnate or regulatory approvals falter.

Investors must weigh two realities:
1. The Near Term: Tesla’s stock is priced for perfection, yet it faces declining sales, margin pressures, and a bruised brand. A further 10% drop in deliveries could trigger a death spiral in investor confidence.
2. The Long Term: The FSD platform and robotaxi vision remain game-changers—if executed. But execution risks are immense, and competitors like Waymo are already leapfrogging Tesla in autonomous tech.

For now, the numbers are unkind. With a P/E ratio twice that of 2020, Tesla’s valuation hinges on a bet that Musk can revive growth while navigating political and regulatory minefields. Until then, investors are left with a stark choice: ride the rollercoaster of a visionary’s ambition—or bet on the odds of a comeback.

The verdict? Tesla’s stock isn’t just a play on electric vehicles—it’s a gamble on Musk’s ability to balance politics, innovation, and profitability. For bulls, the upside is massive. For the rest, the writing is on the wall: Tesla’s crash is far from over.