Tesla (TSLA) stock inched lower on April 2 after the electric vehicle (EV) giant reported its first quarter. deliveries that were significantly below Wall Street estimates.
In its press release, Elon Musk’s company said it delivered 358,023 vehicles in the first quarter, a drop of more than 14% sequentially and missing consensus estimates of around 365,645 units.
Compared to its year-to-date high, Tesla stock is now down about 20%.
Investors dumped TSLA stock this morning primarily because the first-quarter deliveries report indicates that the “EV slowdown” may be a company-specific issue, not a macro trend.
As Tesla struggled with a production-delivery gap of more than 50,000 units, its Chinese competitors saw a significant sales rebound in March.
BYD (BYDDY) surged with nearly 296,000 passenger vehicles sold, while Li Auto (LI) and Nio (NIO) each posted strong double-digit (month-over-month) gains. Even the newcomer Xiaomi (XIACY) exceeded 20,000 monthly units.
This divergence indicates that Tesla is losing control of the world’s largest EV market (China) as local brands offer more frequent updates and aggressive pricing.
Despite the weakness in deliveries, Wedbush senior analyst Dan Ives still recommends holding onto Tesla stock in 2026.
According to Ives, investors should focus more on the company’s artificial intelligence (AI) initiatives as they are now more important to its future cash generation and share price performance.
Ives maintained an “Outperform” rating on TSLA with a $600 price target, indicating over 60% upside potential from current levels.
At less than 15 times sales, EV stocks are currently trading at a valuation multiple much lower than their historical average, making them even more attractive to those looking for a bargain.
Other Wall Street analysts are not as optimistic as Ives, but they do believe that the recent sell-off in TSLA stock has gone too far.
According to Barchart, while the consensus rating for Tesla is “Hold,” the average price target of around $405 indicates a potential upside of nearly 13% over the next 12 months.