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At least five brokerages cut their price target on the stock, citing softer delivery in 2022, with Wedbush Securities making the biggest cut of $60 to bring its target to $300.
“The bullish narrative is clearly hitting a rough patch as Tesla must now prove again to the Street that the robust growth story is running into a myriad of logistics issues as opposed to demand softening,” Wedbush analyst Daniel Ives wrote in a note.
The stock, which is down 37% this year, fell 4.6% to $211.80 in premarket trading.
In its quarterly earnings report, the company pointed to challenges it was facing on the logistics front for a potential miss in hitting the delivery growth target of 50% this year.
Tesla Chief Executive Officer Elon Musk said on a post-earnings call that “demand is little harder” than it would otherwise be, while reiterating that the company was extremely confident of a record fourth quarter.
Tesla missed automotive gross margin expectations despite higher selling price of cars, as costs to ramp up production at its new factories in Berlin, Germany and Austin, Texas weighed.
“We are marginally more cautious post results given the unexpected price decline, tough production targets for 2022 (and beyond), and continued skepticism of the FSD timeline to full autonomy,” Wells Fargo (NYSE:WFC) analysts wrote in a note.
However, with a shift to electric vehicles gaining momentum globally, some analysts expect Tesla to be a big beneficiary.
“I don’t question demand as EVs are inevitable. (Tesla) has done a great job, there is going to be a shift to EVs,” Roth Capital analyst Craig Irwin said.
