Analyst Says Tesla (TSLA) 'May Not Have Hit Rock Bottom Yet'

We recently published a list of Top 10 Buzzing Stocks You Should Watch Today. In this article, we are going to take a look at where Tesla Inc (NASDAQ:TSLA) stands against other top buzzing stocks you should watch today.

Jim Cramer in a recent program on CNBC expressed surprise that the Republican administration could be this damaging to shareholders

“These are hideous depressing days for the bulls. I’m not used to seeing a White House that doesn’t seem to care that it’s causing the decline. It’s dazzlingly counterintuitive to see a Republican in particular be so callous toward the shareholder class. After all historically that constituency has been very pro-Republican. It’s a total blast zone out there and ground zero is tech.”

Cramer said that the tech selloff forced him to revisit his age-old mantra of “own it, don’t trade it” regarding two major technology stocks.

READ ALSO: 7 Best Stocks to Buy For Long-Term and 8 Cheap Jim Cramer Stocks to Invest In.

For this article, we picked 10 stocks Wall Street analysts are paying close attention to. With each company, we have mentioned its latest hedge fund sentiment. 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

Steve Westly, The Westly Group founder & managing partner, said in a recent program on CNBC that Tesla Inc (NASDAQ:TSLA) Q1 delivery data showed a “stark” contrast to the broader industry, where EV sales are growing. The analyst believes the Elon Musk-led company needs a growth catalyst soon:

“You can’t go on forever without showing growth in profits, and look, this is a rough quarter for Tesla, and they may not have hit rock bottom yet. Big miss on deliveries—337,000 vehicles versus an estimate of 380,000. That’s a 13% decrease, and it stands in stark contrast to the rest of the world. EVs grew 29% year-over-year, Tesla’s shrank 13%. So that’s why the share price has dropped 50% from a December high of 1.5 trillion, down now to just over 700 billion. It’s hard to lose $800 billion in shareholder value without investors getting a little worried. Now analysts expect a flat Q1, revenues probably 21.5 billion. That could be lower revenues for 2025, and if you want to be valued as a flashy high-tech company, you need the growth to go with it. Punch line: Tesla needs to find a new growth engine soon.”

Tesla’s EV sales are falling all over the world as the company faces challenges from competitors. Even if Elon Musk increases his focus to fix 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.

ClearBridge Large Cap Growth Strategy stated the following regarding Tesla, Inc. (NASDAQ:TSLA) in its Q1 2025 investor letter:

“Our active underweight to the Magnificent Seven added more than 100 basis points to relative returns for the quarter, with underweights to EV maker Tesla, Inc. (NASDAQ:TSLA) and Google parent Alphabet being among the largest relative contributors. We added to both positions, taking advantage of what we view as short-term weakness as Alphabet missed high expectations for cloud revenue growth in its latest quarter, while Tesla worked through negative sentiment over CEO Elon Musk’s role in the Trump administration.”

Overall, TSLA ranks 3rd on our list of top buzzing stocks you should watch today. While we acknowledge the potential of TSLA as an investment, our conviction lies in the belief that under the radar 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.

READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.

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