Tesla Stock Forecast: Buckle Up! Tesla Shareholder Ross Gerber Drops Four Alarming Reasons the Stock Could Tank 50% in 2025; If You’re Invested, Check Out What He’s Saying
The Tesla Brand: Buckle Up for a Thumping?
Tesla, the pioneer in the electric vehicle (EV) industry, has been a hot topic in the world of finance and technology. However, one of its major shareholders, Ross Gerber, has raised a red flag about the company’s future prospects. As the president and CEO of Gerber Kawasaki Wealth & Investment Management, a company renowned for its investment advice, Gerber has sounded the alarm, warning investors that Tesla’s stock could plummet by a whopping 50% in 2025. Let’s dive into the four reasons why this might be the case.
1. Full Self-Driving (FSD) Technology Not Ready for Prime Time?
Gerber’s first concern is Tesla’s Full Self-Driving (FSD) technology. Despite Elon Musk’s ambitious goal of launching a driverless taxi network in Austin, Texas, by June, Gerber believes that it’s a far-fetched target. He stressed that Tesla’s self-driving technology relies on cameras, which, in his opinion, puts them "well behind" in the race for autonomy. As a result, he’s concerned that the company’s technology may not be ready for widespread adoption.
Gerber’s Verdict: "I’m in the camp now that you need LIDAR to have a safe enough system for Full Self-Driving."
2. Elon Musk’s Split Attention: A Detriment to Tesla’s Future?
Gerber’s second concern is Elon Musk’s divided attention. As the CEO of multiple companies, including Tesla, SpaceX, xAI, x (formerly Twitter), and DOGE, Gerber believes that Tesla isn’t getting the focus it needs. "His 100% focus is on AI, and that’s really a detriment to Tesla," Gerber stated. He thinks that if Musk dedicated more time to Tesla’s autonomous projects, he’d feel more confident about the company’s future.
3. Slowing Vehicle Sales and Rising Competition: The Perfect Storm?
Gerber’s third point is the slowing down of Tesla’s vehicle sales and the growing competition in the EV market. While Tesla has long been a leader in the EV industry, Gerber pointed out that the company’s core business – selling vehicles – is slowing down. Moreover, competition from Chinese EV giant BYD is intensifying, especially in emerging markets. "BYD is such a good company, everybody in the emerging markets are buying BYDs," Gerber remarked.
4. Tesla’s High Valuation: A Recipe for Disaster?
Gerber’s final concern is Tesla’s sky-high valuation. With a market capitalization of over $1.1 trillion, Tesla is trading at nearly five times the size of Toyota, despite delivering only a fraction of Toyota’s profits. Gerber believes that the company’s stock is overvalued and could fall significantly if its growth slows.
Gerber’s Warning: "We think it’s pretty overvalued."
The Verdict: Buckle Up for a Potential 50% Drop?
In conclusion, Gerber’s concerns about Tesla’s FSD technology, Elon Musk’s divided attention, slowing vehicle sales, and high valuation could lead to a 50% drop in its stock price. JPMorgan, a leading investment bank, has also released a bearish outlook on Tesla’s stock, keeping its price target at $135, implying a potential 60% downside. If you’re invested in Tesla, it’s essential to take heed of Gerber’s warning and keep a close eye on the company’s future developments.
Frequently Asked Questions
Why did Ross Gerber say Tesla’s stock might fall by 50%?
Gerber pointed to the delayed development of Full Self-Driving technology, Elon Musk’s split attention, dwindling car sales, and the overly high valuation of Tesla compared to its realized earnings.
Is Elon Musk distracted from Tesla?
Yes, according to Gerber, Elon Musk’s focus is split among his other businesses, such as SpaceX, xAI, and AI, without Tesla’s full attention.
By acknowledging these potential red flags, investors can make more informed decisions about their positions in the Tesla stock market. But will Gerber’s warnings prove prescient, or will Tesla defy the odds and continue its dominant position in the EV industry? Only time will tell.
