

Investor's Corner
Tesla stock: Morgan Stanley pumps the brakes and lowers PT ahead of earnings
Analysts at Morgan Stanley pumped the brakes on Tesla stock by lowering its price target ahead of the automaker’s Earnings Call late this week.
Tesla shares are down 15 percent so far this year. Over the past year, shares are up 66 percent, but moving into 2024, some bulls are remaining cautious.
Morgan Stanley is one of them. In a note to investors released on Monday, analysts at the firm noted there are several factors that could spell trouble for global demand, including increased competition, pricing instability, and slowing demand for EVs.
Tesla will report Earnings on Wednesday. The company reached its 1.8 million unit delivery goal in 2023. It also dominated EV deliveries in the United States and Europe and was toward the top of the list in China. It launched the Cybertruck, a new Model 3 design, and has plenty of other catalysts moving into 2024. However, an ever-changing landscape, more competition, and other factors have Morgan Stanley proceeding with increased caution for the year.
In a note from analysts at the firm, they wrote about the potential risks for the stock this year:
“Global EV momentum is stalling. The market is over-supplied vs. demand. We anticipate Tesla’s 2024 outlook to be cautious on volume and profitability…Tough sledding for EVs but we remain OW on AI and robotics optionality.”
Adam Jonas listed several risk factors for the stock in the note, which include price cuts, weakening or expiration of EV incentives, excess capacity in China, residual value risks, and fleets cutting EV concentration.
Price Cuts
Tesla is still working on pricing stability, which improved greatly throughout 2023 but still offered some concern for investors. Less expensive EVs equate to increased adoption, but it also puts pressure on margins and profitability for the company.
Tesla has already cut prices in China and Europe this year, which is concerning from Morgan Stanley’s standpoint:
“Tesla has already announced price cuts in China and Europe that matched or exceeded our prior expectations of price reductions for the full year 2024. The German Tesla price cuts came merely days after Tesla announced production cuts at Giga Berlin related to Red Sea shipping issues. Lower production is usually positive for prices. This suggests the European EV situation is changing quite rapidly.”
Expiration/Weakening of EV Incentives
In the U.S. especially, Tesla is adjusting the narratives that surround some of its vehicles and their eligibility for EV tax credits. Two Model 3 configurations lost the tax credit, and as it is one of the best-selling EVs in Tesla’s lineup, it is not a positive, although the car is still affordable.
Morgan Stanley is also skeptical about the future of the IRA, stating it looks to be “increasingly uncertain.”
Some consumers are in need of these incentives to purchase the vehicle, and even if they are not a necessity, they are a benefit. It could sway many consumers in the direction of other vehicles. It is important to note that Volkswagen, BMW, Audi, and Ford also lost tax credit eligibility on some of their EVs.
Excess Capacity in China
Morgan Stanley said its Chinese team noted sales cannibalization, increased battery capacity and inventory, and the expiration of “certain local stimulus measures” as reasons Tesla may feel the heat.
Residual Value Risks
Price cuts from OEMs have pressured EV residuals, and dealerships are less bullish on electric cars than ever. Jonas writes that residual value volatility “hurts the value proposition for consumers and creates uncertainty around leasing partners who don’t want to hold this risk.” This includes Tesla.
Tesla’s leasing penetration is in the low single digits globally, Morgan Stanley notes.
Fleets Cutting EVs
Hertz made a drastic announcement earlier this month, stating it would backtrack its massive commitment to EVs as it did not properly account for the cost of damages. One-third of its EV fleet is being sold off, and a portion of the proceeds will go back into combustion engine vehicles.
Other companies are doing this as well on a smaller scale. Fleets offer a few advantages, including a large boost to orders for EV makers. Hertz planned to buy 100,000 Teslas, for example.
They also give drivers an opportunity to drive EVs before buying. While this will still be available, it will be less widespread.
Price Target Downgrade
Morgan Stanley moved its price target to $345 from $380.
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Investor's Corner
Shareholder group urges Nasdaq probe into Elon Musk’s Tesla 2025 CEO Interim Award
The SOC Investment Group represents pension funds tied to more than two million union members, many of whom hold shares in TSLA.

An investment group is urging Nasdaq to investigate Tesla (NASDAQ:TSLA) over its recent $29 billion equity award for CEO Elon Musk.
The SOC Investment Group, which represents pension funds tied to more than two million union members—many of whom hold shares in TSLA—sent a letter to the exchange citing “serious concerns” that the package sidestepped shareholder approval and violated compensation rules.
Concerns over Tesla’s 2025 CEO Interim Award
In its August 19 letter to Nasdaq enforcement chief Erik Wittman, SOC alleged that Tesla’s board improperly granted Musk a “2025 CEO Interim Award” under the company’s 2019 Equity Incentive Plan. That plan, the group noted, explicitly excluded Musk when it was approved by shareholders. SOC argued that the new equity grant effectively expanded the plan to cover Musk, a material change that should have required a shareholder vote under Nasdaq rules.
The $29 billion package was designed to replace Musk’s overturned $56 billion award from 2018, which the Delaware Chancery Court struck down, prompting Tesla to file an appeal to the Delaware Supreme Court. The interim award contains restrictions: Musk must remain in a leadership role until August 2027, and vested shares cannot be sold until 2030, as per a Yahoo Finance report.
Even so, critics such as SOC have argued that the plan does not have of performance targets, calling it a “fog-the-mirror” award. This means that “If you’re around and have enough breath left in you to fog the mirror, you get them,” stated Brian Dunn, the director of the Institute for Comprehension Studies at Cornell University.
SOC’s Tesla concerns beyond Elon Musk
SOC’s concerns extend beyond the mechanics of Musk’s pay. The group has long questioned the independence of Tesla’s board, opposing the reelection of directors such as Kimbal Musk and James Murdoch. It has also urged regulators to review Tesla’s governance practices, including past proposals to shrink the board.
SOC has also joined initiatives calling for Tesla to adopt comprehensive labor rights policies, including noninterference with worker organizing and compliance with global labor standards. The investment group has also been involved in webinars and resolutions highlighting the risks related to Tesla’s approach to unions, as well as labor issues across several countries.
Tesla has not yet publicly responded to SOC’s latest letter, nor to requests for comment.
The SOC’s letter can be viewed below.
Investor's Corner
Tesla investors may be in for a big surprise
All signs point toward a strong quarter for Tesla in terms of deliveries. Investors could be in for a surprise.

Tesla investors have plenty of things to be ecstatic about, considering the company’s confidence in autonomy, AI, robotics, cars, and energy. However, many of them may be in for a big surprise as the end of the $7,500 EV tax credit nears. On September 30, it will be gone for good.
This has put some skepticism in the minds of some investors: the lack of a $7,500 discount for buying a clean energy vehicle may deter many people from affording Tesla’s industry-leading EVs.
Tesla warns consumers of huge, time-sensitive change coming soon
The focus on quarterly deliveries, while potentially waning in terms of importance to the future, is still a big indicator of demand, at least as of now. Of course, there are other factors, most of them economic.
The big push to make the most of the final quarter of the EV tax credit is evident, as Tesla is reminding consumers on social media platforms and through email communications that the $7,500 discount will not be here forever. It will be gone sooner rather than later.
It appears the push to maximize sales this quarter before having to assess how much they will be impacted by the tax credit’s removal is working.
Delivery Wait Time Increases
Wait times for Tesla vehicles are increasing due to what appears to be increased demand for the company’s vehicles. Recently, Model Y delivery wait times were increased from 1-3 weeks to 4-6 weeks.
This puts extra pressure on consumers to pull the trigger on an order, as delivery must be completed by the cutoff date of September 30.
Delivery wait times may have gone up due to an increase in demand as consumers push to make a purchase before losing that $7,500 discount.
More People are Ordering
A post on X by notable Tesla influencer Sawyer Merritt anecdotally shows he has been receiving more DMs than normal from people stating that they’re ordering vehicles before the end of the tax credit:
Anecdotally, I’ve been getting more DMs from people ordering Teslas in the past few days than I have in the last couple of years. As expected, the end of the U.S. EV credit next month is driving a big surge in orders.
Lease prices are rising for the 3/Y, delivery wait times are… pic.twitter.com/Y6JN3w2Gmr
— Sawyer Merritt (@SawyerMerritt) August 13, 2025
It’s not necessarily a confirmation of more orders, but it could be an indication that things are certainly looking that way.
Why Investors Could Be Surprised
Tesla investors could see some positive movement in stock price following the release of the Q3 delivery report, especially if all signs point to increased demand this quarter.
We reported previously that this could end up being a very strong rebounding quarter for Tesla, with so many people taking advantage of the tax credit.
Whether the delivery figures will be higher than normal remains to be seen. But all indications seem to point to Q3 being a very strong quarter for Tesla.
Elon Musk
Tesla bear Guggenheim sees nearly 50% drop off in stock price in new note
Tesla bear Guggenheim does not see any upside in Robotaxi.

Tesla bear Guggenheim is still among the biggest non-believers in the company’s overall mission and its devotion to solving self-driving.
In a new note to investors on Thursday, analyst Ronald Jewsikow reiterated his price target of $175, a nearly 50 percent drop off, with a ‘Sell’ rating, all based on skepticism regarding Tesla’s execution of the Robotaxi platform.
A few days ago, Tesla CEO Elon Musk said the company’s Robotaxi platform would open to the public in September, offering driverless rides to anyone in the Austin area within its geofence, which is roughly 90 square miles large.
Tesla CEO Elon Musk confirms Robotaxi is opening to the public: here’s when
However, Jewsikow’s skepticism regarding this timeline has to do with what’s going on inside of the vehicles. The analyst was willing to give props to Robotaxi, saying that Musk’s estimation of a September public launch would be a “key step” in offering the service to a broader population.
Where Jewsikow’s real issue lies is with Tesla’s lack of transparency on the Safety Monitors, and how bulls are willing to overlook their importance.
Much of this bullish mentality comes from the fact that the Monitors are not sitting in the driver’s seat, and they don’t have anything to do with the overall operation of the vehicle.
Musk also said last month that reducing Safety Monitors could come “in a month or two.”
Instead, they’re just there to make sure everything runs smoothly.
Jewsikow said:
“While safety drivers will remain, and no timeline has been provided for their removal, bulls have been willing to overlook the optics of safety drivers in TSLA vehicles, and we see no reason why that would change now.”
He also commented on Musk’s recent indication that Tesla was working on a 10x parameter count that could help make Full Self-Driving even more accurate. It could be one of the pieces to Tesla solving autonomy.
Jewsikow added:
“Perhaps most importantly for investors bullish on TSLA for the fleet of potential FSD-enabled vehicles today, the 10x higher parameter count will be able to run on the current generation of FSD hardware and inference compute.”
Elon Musk teases crazy new Tesla FSD model: here’s when it’s coming
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