Tesla Faces Declining Sales and Increased Competition, Prompting Sell Rating

Wells Fargo analyst Colin Langan has maintained their bearish stance on TSLA stock, giving a Sell rating on December 10.

Colin Langan has given his Sell rating due to a combination of factors impacting Tesla’s market performance. The available data for November shows a significant decline in Tesla’s deliveries across major markets, with a year-over-year decrease of 9% and a quarter-to-date drop of 15%. This downward trend is particularly pronounced in Europe, where sales have fallen by 12% year-over-year in November and 28% year-to-date, excluding the temporary boost from Norway due to tax incentives.
In the United States, the expiration of the IRA credits has led to a noticeable reduction in demand, with estimates showing a year-over-year sales decline of 24% in November. Despite a month-over-month rebound in China, sales there are still slightly down compared to the previous year. The overall sales slump is expected to persist into the fourth quarter, reflecting increased competition in Europe and the diminishing impact of previous incentives. These factors collectively contribute to a concerning trend for Tesla’s quarterly performance, prompting the Sell rating.

In another report released on December 10, GLJ Research also maintained a Sell rating on the stock with a $19.05 price target.

Based on the recent corporate insider activity of 45 insiders, corporate insider sentiment is positive on the stock. This means that over the past quarter there has been an increase of insiders buying their shares of TSLA in relation to earlier this year.