Ross Gerber, a prominent investor and president of Gerber Kawasaki Wealth & Investment Management, has warned that Tesla’s shares could drop by as much as 50% in 2025 due to several concerns. The predictions come after an initial surge in Tesla stock post-Elon Musk’s election win, which has since slowed down.
Gerber pointed out four main reasons behind his bearish outlook on Tesla:
1. Full Self-Driving capabilities are not yet mature, with the use of cameras as a primary system being less effective than other driverless systems that utilize lidar sensors.
2. Elon Musk’s multiple business ventures and unpredictable behavior could be detrimental to Tesla shareholders, taking focus away from the company’s core business.
3. Slowdown in vehicle sales is due to competition from China’s BYD, which is gaining popularity globally, and Musk’s close association with former President Trump, leading to public backlash against Tesla.
4. The premium valuation of Tesla stock, with a forward price-to-earnings ratio of 118 times, may not hold up if the company fails to deliver on its promises.
Gerber’s predictions are supported by some major Wall Street firms, including JPMorgan, which warned of potential downside in Tesla stock after the latest earnings release. With Gerber having sold his own shares and reduced his firm’s stake by 31% in 2024, it seems he is putting his money where his mouth is on this bearish outlook for Tesla.
Source: https://www.businessinsider.com/tesla-stock-price-2025-outlook-crash-elon-musks-gerber-tsla-2025-2