Investor's Corner
Wall Street thinks Tesla ($TSLA) is headed into bear territory
In advance of tomorrow’s Q4 earnings call, Tesla investors and Wall Street analysts have seldom held more conflicting views about where the stock is heading. Shares in Tesla have advanced 50% in the past 3 months, setting historic highs along the way. Based on market capitalization, Tesla is now worth just slightly less than auto manufacturers Ford and General Motors.
Some analyst think the stock will go higher still. Morgan Stanley’s Adam Jonas forecasts a price of $305 per share in the near future but many of his colleagues disagree. Bloomberg recently polled 14 analysts and found the majority of them see the stock going lower in the months ahead. The median response was $48 per share below where the stock is today. That is the most pessimistic view among Wall Street traders since Tesla went public 7 years ago and is reflected in Bloomberg’s chart below.
Of the six analysts who have updated their advice on Tesla in the month of February, none has raised the estimate. That is despite the company announcing that it would begin pilot production of the Model 3 this week, news that has been one of the triggers for the latest run up. We “see no fundamental reason for run-up,” said UBS Securities LLC analyst Colin Langan. He sent a note to his clients last week in which he projected the price of Tesla stock to fall back to$160 a share over the next 12 months.
Why the disconnect? Traditionally, market watchers pay attention to something they call the Relative Strength Index, which measures the speed and change of a stock price either up or down. In essence, it is is a tool designed to strip out the emotional component that affects all stock valuations and insulate professionals from getting caught up in the herd mentality.
If the RSI climbs above 70, that indicates a stock is “overbought.” Such a level is widely considered to be a “sell signal.” Conversely, anything below 30 is considered “oversold” and is considered a “buy signal.” Tesla’s RSI soared to 83 last week, the highest level in more than 4 years.
Tesla has a lot on its plate this year. In addition to getting the Model 3 into regular production, it is aggressively pursuing its grid scale battery storage business, expanding the Gigafactory, completing the integration of SolarCity into the business, rolling out its new Solar Roof product line, continuing the expansion of its Supercharger network, opening new stores, and building new service centers. It is also pushing into new markets in Portugal, Dubai, Taiwan, India, and Korea.
In the spring of 2016, Elon Musk predicted Tesla would have a market capitalization equal to Apple by the year 2025, or somewhere around $700 billion. Musk has never been shy about touting his projections for the future and many investors take his pronouncements as articles of faith. They see stock analysts as Luddites who just don’t “get it” when it comes to Musk and Tesla.
“Tesla is a serial capital raiser,” says Adam Jonas. “As such, its ability to sustain its operations and fundamental value is inextricably linked to the very performance of its share price, creating a self-reinforcing momentum.” Whether that “self-reinforcing momentum” will continue to propel Tesla’s stock price higher is anybody’s guess.
Tesla short sellers won big following the company’s massive fall on Wall Street after it reported subpar Earnings on Wednesday.
Tesla short sellers collected about $4.12 billion in single-day profits on Thursday, according to Bloomberg. Shares fell as much as 15 percent during Thursday’s session. It closed as one of the worst days for Tesla on Wall Street in the past three years.
Investors sold off the stock after Tesla said it would aggressively direct its spending toward AI and its Optimus robot project. The company had record revenues, which were driven by one of the strongest quarters in terms of vehicle deliveries in company history.
However, it missed EPS estimates by reporting just $0.33, a far cry from the $0.53 analysts expected.
S3 Partners reported that about 3 percent of Tesla’s outstanding stock is sold short. Managing Director at S3, Ihor Dusaniwsky, provided the short seller’s potential profit, as well as another figure: shorts have likely had paper gains of $8.92 billion this year, as Tesla shares are down 30 percent in 2026.
Tesla (TSLA) Q2 2026 earnings results: miss on EPS, beat on revenue
Tesla has burned short sellers many times in the past, but the company’s latest Earnings Call was a chance for those skeptics to taste some payback. Although the company gave some very transparent information regarding future projects, the rollout of Robotaxi, Optimus, and Semi, many investors took their profits on Thursday.
Notable short sellers like Michael Burry have been transparent about their skepticism around Tesla shares. Burry just revealed three weeks ago that he had opened up a new short on the stock, stating he shorted Tesla shares at $416.22. “Happy it jumped back to this level,” he said in a blog post.
At the time of publication, Tesla shares were down about 3 percent and the stock was trading at $309.92.
Tesla stock (NASDAQ: TSLA) endured one of its sharpest single-day declines in years on July 23, tumbling approximately 14.5 percent and closing near $320 after opening the session around $374. The drop erased more than $140 billion in market value amid heavy trading volume and left the shares at multi-week lows.
The sell-off followed the company’s second-quarter 2026 results, released the previous evening. Tesla reported record revenue of $28.2 billion, up 26 percent year over year, driven by a Q2-record 480,126 vehicle deliveries. Energy storage deployments also rose strongly.
Tesla (TSLA) Q2 2026 earnings results: miss on EPS, beat on revenue
Yet profitability disappointed sharply. Operating income fell 57 percent to $398 million, compressing the operating margin to just 1.4 percent. Non-GAAP earnings per share came in at $0.33, well below the roughly $0.53 analysts had expected. Free cash flow turned negative by $1.1 billion as capital expenditures surged 142 percent to $5.8 billion, largely tied to accelerated spending on artificial intelligence, robotics, and autonomous systems.
The losses on capex were expected, as Tesla said it would be spending heavily in 2026.
Investors also reacted to lingering uncertainty surrounding key product timelines. During the Earnings Call, management reiterated ambitions for Robotaxi deployment and the Optimus humanoid robot, but offered limited new concrete milestones, renewing questions about execution pace that have long accompanied Tesla’s ambitious roadmap.
The magnitude of the decline places it among Tesla’s more severe one-day percentage losses since its 2010 initial public offering. Historically, the two largest single-day drops (split-adjusted) remain September 8, 2020, when shares fell 21.1 percent amid broader market volatility and valuation concerns, and January 13, 2012, with a 19.3 percent plunge during the company’s early growth struggles.
Other notable declines include an 18.6 percent drop on March 16, 2020, at the onset of pandemic-related market turmoil. Thursday’s move ranks roughly ninth on the all-time list but stands out as the steepest in more than a year.
Despite the short-term pain, Tesla’s long-term trajectory has repeatedly recovered from such volatility. The latest results underscore both the strength of its core automotive and energy businesses and the near-term costs of heavy investment in next-generation technologies.
In a striking revelation that underscores the lucrative crossover between Big Tech and space exploration, Alphabet Inc., Google’s parent company, disclosed a massive $94.1 billion equity stake in SpaceX following the rocket company’s blockbuster initial public offering earlier this year.
The disclosure came in Alphabet’s quarterly filing, marking the first time the long-held private investment has been publicly valued at market prices. Google was an early backer, investing alongside Fidelity in 2015 with roughly $500-900 million at a time when SpaceX was valued around $12 billion.
That bet has delivered extraordinary returns, roughly a hundredfold, transforming a strategic play on satellite internet and launch capabilities into one of Alphabet’s largest assets.
Google, $GOOGL, has said they hold $94 billion in SpaceX, $SPCX, shares after IPO.
— unusual_whales (@unusual_whales) July 23, 2026
Of the total holding, approximately $80 billion remains subject to short-term post-IPO lockup restrictions, preventing near-term sales. An additional $14.1 billion faces longer-term restrictions, extending into the third quarter of 2027. This structure limits immediate liquidity but protects against market volatility as SpaceX transitions into public trading.
The SpaceX position contributed significantly to gains in Alphabet’s broader investment portfolio, which also includes a major stake in AI leader Anthropic. Combined, these holdings helped drive nearly $100 billion in investment gains during the second quarter, providing a substantial boost to net income amid ongoing AI spending pressures.
Analysts view the disclosure as validation of Alphabet’s venture strategy beyond its core search and cloud businesses. The investment aligns with deeper ties, including reported multi-billion-dollar deals for AI computing capacity on SpaceX infrastructure. As SpaceX advances Starship flights, Starlink expansion, and ambitious Mars goals under Elon Musk, Google’s stake positions it to benefit from the commercialization of space.
For Alphabet, the windfall highlights how patient, forward-looking bets in transformative sectors can yield outsized rewards. While lockups temper short-term impact, the holding cements SpaceX as a cornerstone of Alphabet’s diversified portfolio in an era where aerospace, AI, and connectivity increasingly intersect. Investors will watch closely as restrictions lift and SpaceX’s public performance unfolds.
Tesla’s Supercharger Diner probably just secured more locations
Tesla short sellers win big after shares fall after earnings
