Despite lingering concerns about Tesla losing control of the European market, Norway remains a bright spot. According to the European Automobile Manufacturers Association (ACEA), Tesla registrations in December in the country (which can be taken as an indicator of sales) increased by 89% compared to the previous year period to 5,679 units. The company gained a 19.1% share of the Norwegian car market in 2025, becoming the best-selling car manufacturer in the country for the fifth consecutive year.
Is this silver lining enough to justify investing in TSLA stock now?
Headquartered in Austin, Texas, Tesla leads innovation in electric vehicles (EV) through its global manufacturing network of gigafactories. These facilities produce vehicles such as the Model 3, Model Y and Cybertruck, as well as energy solutions including its Powerwall batteries and Megapack storage systems.
Tesla’s operations span vehicle design, autonomous driving (AD) software development through full self-driving (FSD) upgrades, Supercharger network expansion, and solar energy integration, with a recent focus on expanding Cybertruck production in Giga Texas and improving artificial intelligence (AI)-powered robotics. The company has a market capitalization of approximately $1.46 trillion.
Tesla faces growing challenges to its once unrivaled dominance in electric vehicles, as market saturation and policy changes erode early advantages. The intensification of global competition indicates that a more contested landscape lies ahead for the company.
TSLA stock is down 5% over the past month. However, the stock remains in the green over the long term. In the last 52 weeks, the stock has gained 5% and in the last six months, 37%. TSLA hit a 52-week high of $498.83 in late December, but is now down 13% from that level.
www.barchart.com
Tesla stock is trading at an eye-popping valuation. Its forward price-earnings multiple is currently 251 times, which is significantly higher than the industry average.
Tesla’s total production for the third quarter of fiscal 2025 fell 5% year-over-year (YOY) to 447,450 units. While Model 3/Y production decreased by only 2% annually, the company’s other models recorded a considerable drop of 56% compared to the previous year. On the other hand, Tesla achieved record deliveries of 497,099 units, a year-over-year increase of 7%, during the quarter. Growth was once again driven by deliveries of its flagship 3/Y model, while deliveries of the other models declined compared to the previous year.
Tesla reported total revenue of $28.1 billion for the third quarter, up 12% year over year, while its automotive revenue rose 6% year over year to $21.21 billion. While Tesla’s revenue grew by double digits, it was modest compared to the company’s own standards. Furthermore, this slow growth also translated into declines in results.
Tesla’s total gross margin in the third quarter fell 185 basis points to 18%, while its operating margin fell 501 basis points to 5.8%. The company’s non-GAAP EPS decreased 31% year over year to $0.50. Tesla cited higher expenses and lower revenue from regulatory credits as reasons for the headwinds in results.
Wall Street analysts are not optimistic about Tesla’s ultimate growth trajectory. For the fourth quarter, analysts expect EPS to decline 48% year-over-year to $0.34. For fiscal 2025, EPS is projected to decline 45% year-over-year to $1.12, followed by a 59% year-over-year improvement to $1.78 the following year.
This month, analysts at Truist Securities maintained a “Hold” rating on TSLA stock while lowering the price target from $444 to $439. Following the announcement of deliveries of 418,227 units by the electric vehicle company in the fourth quarter, without estimates, analysts reduced the price target. Despite this, Truist also pointed to Tesla’s AI projects, particularly the development of FSD, which could be “far more important than car deliveries to long-term cash generation and TSLA stock performance.”
Late last month, Baird analyst Ben Kallo reiterated an “outperform” rating and kept the price target at $548, showing the company has a bullish view on Tesla’s prospects.
Wall Street analysts are now taking a cautious stance on TSLA stock, with an overall consensus rating of “Hold.” Of the 40 analysts rating the stock, 14 analysts have a “Strong Buy” rating, one analyst provides a “Moderate Buy” rating, 16 analysts play it safe with a “Hold” rating and nine analysts provide a “Strong Sell” rating. The consensus price target of $395.32 represents a potential downside of 8% from current levels. However, the street’s high price target of $600 indicates 39% upside potential from current levels.
www.barchart.com
Tesla’s strength in the Norwegian market could be significant, as electric vehicles are gaining importance in the country. Reportedly, 96% of cars sold in Norway in 2025 were electric vehicles, up from 89% in 2024 and 82% in 2023. In December, almost all cars sold in the country were electric vehicles. However, Tesla struggled to maintain its position in other key markets, such as France and Sweden.
Additionally, there are concerns surrounding Tesla’s production and delivery numbers. For fiscal 2025, Tesla reported its production numbers at 1.65 million units, down from the 1.77 million units produced in 2024. Delivery numbers also reported a year-over-year drop for the period. This shows that Tesla’s operations have come under pressure, recording two consecutive years of annual production and revenue declines.
Given this situation, it might be prudent for investors to watch TSLA stock for now.
As of the date of publication, Anushka Dutta had no (directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article are for informational purposes only. This article was originally published on Barchart.com
