A long-term bearish analyst on Tesla said that Tesla may ultimately plummet by 65%;
He reiterated his target price of $85.
He said that this electric vehicle manufacturer has soared in the hype of artificial intelligence, but has been "severely overestimated.".
An analyst warned that Tesla has been severely overvalued, and its stock price may eventually plummet by 65%.
Roth Capital analyst Craig Irwin, who has long been bearish on Tesla, reiterated his target stock price for Tesla - $85. This means that the company's stock price will fall by more than half from its current level.
As of the close of the US stock market on last Friday (the last trading day of 2023), Tesla's annual increase was about 130%.
"I am bearish because I believe it has been severely overestimated," Irwin said in an interview.
He compared the company to Toyota, which produces about 9 million cars annually. By comparison, Tesla only produced 1.37 million cars last year.
"What Tesla doesn't have is what Toyota doesn't. If its sales are only a small fraction of Toyota's, why is its trading price much higher than Toyota's?" he said.
Nevertheless, Irwin has maintained a "neutral" rating on Tesla's stock as the electric vehicle manufacturer still has some products to support its stock price.
One of the products is Tesla's potential new generation of cars, which Musk has been discussing for many years. Earlier this year, a source revealed that Tesla executives had planned to meet with Indian officials to discuss building a factory for this small car priced below $25000.
Irwin warned, "But I think this is a slow change for the next few years."
Regarding this, Musk also counterattacked, believing that he overlooked Tesla's potential in the fields of artificial intelligence and autonomous driving. During the latest interview, the host shared Irwin's views. Musk responded, "He got it wrong. We are an AI/robotics company."
Irwin's views are also contradictory to those of other Wall Street strategists, as their enthusiasm for Tesla continues to grow after the significant rise in Tesla stocks in 2023. In a report last week, US investment bank Wedbush predicted that Tesla's stock price would soar to $350, which means Tesla's stock price will rise by about 41%.
Strategists say that this is due to increased profit margins, advancements in fully autonomous driving technology, and strong sales momentum in China, which should bring Tesla the same "good luck" as Apple did between 2008 and 2009.