Tesla's Biggest Wall Street Bulls Get Jittery On Fundamentals While Elon Musk's Politics Further Polarizes Retail Traders

Tesla, Inc.'s most prominent cheerleaders on Wall Street are starting to dial back their optimism as concerns mount about declining deliveries amid increasing political backlash for the brand.

Shares of the EV giant are on track for a record ninth straight weekly decline — ever since CEO Elon Musk took up additional duties as part of Trump's administration in Washington, D.C.

Investor sentiment eroded further on Thursday after Tesla recalled over 46,000 Cybertrucks due to a potentially loose exterior panel.

On Thursday, Morgan Stanley analysts led by Adam Jonas cut their Tesla price target to $410 from $430, citing lower-than-expected deliveries in their updated models, an aging lineup, and a "buyer's strike" driven by negative brand sentiment.

The firm noted reports of plunging sales in Europe and China through the year's first two months.

They now forecast 2025 deliveries at 1.615 million units, down 9.8% year-over-year, compared to their previous estimate of 1.924 million (+7.5% y/y). Morgan Stanley lowered its 2030 deliveries estimate to about 4.7 million from 5.2 million.

The analysts said a recent survey showed 21% of respondents expecting Tesla's deliveries to decline by more than 10% year-over-year — a stark contrast to the more bullish outlook at their "Tesla Bull Bear Lunch" in January.

However, the research firm retained its 'Overweight' rating based on its earlier argument that Tesla is becoming a "highly diversified play on AI and robotics." 

According to The Fly, Piper Sandler lowered its price target to $450 from $500, adjusting for factory shutdowns and a Model Y refresh rather than political risks. The research firm noted that Tesla shares had returned to their valuation before the 2024 presidential election. 

Still, Piper Sandler said the company's long-term potential to reshape the transportation and energy markets remains unchanged.

TSLA sentiment and message volume as of March 20. | source: Stocktwits

On Stocktwits, retail traders are fervently debating the growing backlash Tesla is facing, including reports of vandalism and attacks on its vehicles.

"Smashing someone's car to 'punish' a brand seems illogical when you break it down," said one user, who argued that the owner suffers a financial and practical loss while the company itself is not directly impacted.

At the same time, skeptics pointed to Musk's abrupt Tesla all-hands livestream, in which he urged investors to "hang on to your stock", as a sign of desperation.

Musk also stated on social media that "Tesla has ramped up security and activated Sentry Mode on all vehicles at stores."

According to Koyfin data, Tesla stock has lost nearly 40% year-to-date and trades at an almost 44% discount to analysts' average price target.

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