10 Buzzing Stocks After Latest Earnings Season

4. Tesla Inc (NASDAQ:TSLA)

Number of Hedge Fund Investors: 99

Steve Westley from The Westley Group said in a latest program on Schwab Network that Tesla Inc (NASDAQ:TSLA) may not have hit the rock bottom yet and pointed out the key problems visible in the company’s Q1 report.

“I mean Tesla’s had the quadruple whammy this quarter. No new product, no date for the $25,000 Tesla a lot of people are looking for in delayed uh launch of the new cheaper Model Y. They’ve got a polarizing brand, US sales down 13%, sales in Europe down 43% — that’s a lot. Huge and growing competition from BYD and the other Chinese were coming out there with lower cost vehicles, and FSD is late, paused rollout in China, no approval yet in Austin. Those are four pretty big problems to solve.”

Westley said that Tesla Inc (NASDAQ:TSLA) is facing declines when the overall EV industry is seeing growth:

“Look, this is a big miss on deliveries — 337,000 versus 380,000 estimate. Lat Q1 actually down. 19.34 billion, less than anybody expected. But what really stands out here is Tesla’s revenues are down 13%, but rest of the world EV gains are up 29%. That’s hard for the alleged market leader to explain. Share price again dropped 50% from December — that’s a loss of $800 billion. Punch line: it’s a rough quarter for Tesla, and they may not have hit rock bottom yet.”

The analyst is right. 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.

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

“The underweight in Tesla, Inc. (NASDAQ:TSLA) contributed to performance in the first quarter of 2025. Tesla’s automobile sales declined in the quarter, in part due to factory changeovers that were required for updates to the company’s best-selling vehicle, the Model Y. This resulted in slower sales volume in the quarter. Competition from China’s BYD is causing market share losses for Tesla in several non-U.S. markets. The CEO’s position as an advisor to President Trump has damaged Tesla’s brand image among a cohort of traditional electric vehicle buyers.”