Tesla shares jumped 8% after the company reported its first annual sales decline since 2008, despite missing profit and revenue estimates. JPMorgan analyst Ryan Brinkman criticized Tesla’s valuation, citing a pattern of missed earnings projections and a disconnect between the company’s financial performance and stock price.
Brinkman suggested that Elon Musk’s bold predictions may have influenced the stock’s rise, including his statement about Tesla’s Optimus humanoid robot potentially generating “north of $10 trillion in revenue.” However, Brinkman remains bearish on Tesla’s stock, sticking with a $135 price target representing potential downside of 68% from current levels.
The analyst highlighted that Tesla’s guidance for growth in 2025 was moderated to only “a return to growth,” which fits into a broader pattern of the company’s financial performance and consensus estimates declining, while its share price continues to rise. Brinkman believes that Tesla shares have become “completely divorced from the fundamentals,” leaving investors skeptical about the company’s prospects.
Despite this skepticism, Musk remains a dominant force in the market, with shares up 4% year-to-date and 119% over the past year. As Musk gets closer to the White House, investors appear to be more focused on his personal success rather than Tesla’s underlying fundamentals.
Source: https://markets.businessinsider.com/news/stocks/tesla-stock-price-outlook-jpmorgan-tsla-earnings-fundamentals-profit-miss-2025-1