Jim Cramer Says 'There's Nothing Magnificent' About Tesla (TSLA)

We recently published a list of Top 10 Stocks on Jim Cramer’s Radar as Trump Tariffs Wreak Havoc Across Global Markets. In this article, we are going to take a look at where Tesla, Inc. (NASDAQ:TSLA) stands against other top stocks on Jim Cramer’s radar as Trump tariffs wreak havoc across global markets.

Jim Cramer in a latest program on CNBC said that President Donald Trump’s new tariffs were much worse than expected. Cramer believes investors were getting “tired” of worrying about the tariff threat and went into a “bring it on” mode ahead of the Wednesday announcement.

“Regular viewers know that I’ve never been a huge fan of free trade. It would be fine if everybody plays by the rules, but we’re the only country that plays by the rules. I want fair trade instead, which means tariff those who tariff us just as hard. Of course, I’ve been hoping for reciprocal tariffs, and that’s what we allegedly got, even if they were far more severe than I’d hoped for. With reciprocal tariffs, we hammer specific countries for putting up specific trade barriers or subsidizing specific industries. While we got reciprocal tariffs, I never expected them to be this high, nor did many other people. From Wall Street’s perspective, Trump might as well have used a meatax, which is what we were most afraid of. The term reciprocal meant nothing in the end; the term punitive is more accurate.”

Cramer Calls China an ‘Insidious Octopus’

Cramer called China an “insidious Octopus” and mentioned how the country used several “loopholes” to enter the US and European markets. However, he believes the tariffs will result in higher prices for consumers. Cramer said Trump does not “care” about falling stock prices or rising consumer prices.

“Trump doesn’t seem to care about the stock market this time around. Why should he care about certainty, which I’ve said over and over again is what makes investors happy? He’s not trying to make investors happy. He’s not about happiness for us. He’s about making these countries bend to his will, and if it causes inflation, then it causes inflation. He never promised you a rose garden stock market, and I sure didn’t see one in the Rose Garden today.”

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For this article, we picked 10 stocks Jim Cramer recently talked about during his programs on CNBC. With each company we have mentioned the number of hedge fund investors. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).

Tesla, Inc. (NASDAQ:TSLA)

Number of Hedge Fund Investors: 99

Jim Cramer in a latest program discussed the market uncertainties stemming from President Trump’s tariff policies and said the following about the Mag. 7 group of stocks.

“You can buy some low multiple techs, industrials, and banks here. We did that for the charitable trust today, right under the teeth of the selloff. I would not jump back into the Magnificent 7 because, as of tonight, there is no “Mag 7” anymore. I came up with that name, and I’m scrapping it right now — no moniker fits the two or three that remain viable. And I’m not going to put it out there — there’s nothing magnificent about Tesla or Nvidia.”

Tesla’s EV sales are falling all over the world as the company faces challenges from competitors. Even if Elon Musk increases his focus on fixing the company’s problems, it would take a lot of effort to come out of the demand crisis. For example, in California, the largest U.S. market for electric vehicle adoption and sales, Tesla sales fell about 12% year over year in 2024, causing its market share to drop from 60.1% in 2023 to 52.5% in 2024. Was it because Californians are buying fewer EVs? No. Californians purchased more than 2 million electric cars during the year, almost double when compared to the past two years.

Things aren’t looking good for Tesla in Europe, either. For example, in Germany, Tesla delivered just 1,429 new cars in February, down 76% from the same month last year. In contrast, battery-electric vehicle (BEV) registrations surged 30.8% during the month.

Tesla, Inc.’s (NASDAQ:TSLA) product lineup is showing signs of stagnation, with over 95% of sales still coming from the Model 3 and Model Y. Meanwhile, competitors are rolling out more advanced models. According to Reuters, Tesla’s market share in Europe is slipping as legacy automakers like BMW post stronger sales. Chinese competitor BYD is also gaining ground in Europe, despite talk of tariffs.

Polen Focus Growth Strategy stated the following regarding Tesla, Inc. (NASDAQ:TSLA) in its Q4 2024 investor letter:

“The largest relative detractors in the quarter were Tesla, Inc. (NASDAQ:TSLA) (not owned), Thermo Fisher Scientific, and Broadcom (not owned). We’ve spoken at length about our rationale for not owning Tesla. The stock enjoyed a 54% return during the quarter, with effectively all of the share price performance strength coming in the post-election period, as the market expressed a positive view on Elon Musk’s prominent role in the incoming Trump administration and its potential implications for Tesla. While we agree this development should be a net positive for Tesla and recognize the company’s interesting future prospects for autonomous driving and humanoid robots, its current valuation demands that shareholders pay primarily for potential innovations that have yet to materialize, with uncertain risks and timelines, presenting a different type of risk profile than we are comfortable with. Today, Tesla is an automobile manufacturer limited to the higher-income segment and is increasingly challenged to sell vehicles when interest rates are not zero. As such, we continue to question the company’s long-term growth profile, its ability to scale a large robotaxi service (which seems to be the source of euphoria in Tesla shares), and its corporate governance.”

Overall, TSLA ranks 2nd on our list of top stocks on Jim Cramer’s radar as Trump tariffs wreak havoc across global markets. While we acknowledge the potential of TSLA, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than TSLA but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.

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