Caution Builds Around Tesla (TSLA) with Delivery Decline and Bearish Price Targets

Tesla Inc. (NASDAQ:TSLA) is one of the best big tech stocks to buy right now. Tesla’s Q2 2025 update raised concerns over its position as a leader in the EV and clean energy markets. Recent reports suggest that growth in its flagship automotive segment has declined considerably, as competition has eaten into its share with more affordable vehicles.

The company delivered over 384,000 cars in the quarter, which was a 13% decline year-over-year. Not only that, the vehicle average selling price (ASP) also decreased, which led to a 12% year-over-year decline in revenue of $22.5 billion. The near-term outlook remains challenging, with Elon Musk and his management team cautioning that the company faces some rough quarters ahead.

Still, Tesla maintains a strong balance sheet with over $37 billion in cash, which should help it weather the near-term headwinds. It also gives the company flexibility to invest aggressively in R&D, capacity expansion, and vertical integration of battery supply chains.

Investors are also watching to see if Musk can refocus on operational execution after his turbulent period in U.S. government affairs, as improvements here could restore analyst confidence.

Sentiment on Wall Street remains mixed, with some analysts taking a more cautious stance. Among the most bearish on the street is Guggenheim’s analyst Ronald Jewsikow. He recently reiterated his Sell rating on the stock with a $175 price target, expecting a staggering nearly 50% correction. His bearish outlook is due to doubts about whether the company can deliver on its Robotaxi and Full Self-Driving (FSD) timelines, despite recent announcements and strong investor interest. He also notes the absence of a firm plan for removing safety drivers and the limited rollout of the new FSD model, which could challenge the market’s upbeat outlook.

Tesla Inc. (NASDAQ:TSLA) is an EV manufacturer and clean energy company that designs, manufactures, and sells electric vehicles, battery energy storage systems, solar products, and related services.

While we acknowledge the potential of TSLA as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.