After Disastrous First-Quarter Sales, Tesla's Stock Is Down 36% This Year. It Can Go Lower

Core Business Performance - Tesla's first-quarter deliveries were just under 337,000, falling 13% year over year and marking the lowest levels since 2022 [1] - The company is facing rising competition, particularly from BYD in China, which captured 32% of new EV sales compared to Tesla's 6% [2] - Tesla's sales have declined in Europe and China, indicating challenges in its core electric vehicle business [2] Impact of Leadership and Public Perception - Elon Musk's involvement with the Department of Government Efficiency (DOGE) and his political commentary are believed to negatively impact Tesla's performance [3] - Reports indicate that Tesla owners are trading in their vehicles at record rates, potentially due to Musk's actions and public perception issues [4] - Concerns about Musk's ability to balance multiple roles have intensified, especially following Tesla's poor performance [5] Financial Valuation and Future Prospects - Tesla's stock trades at over 93 times forward earnings, despite only a 1% revenue growth year over year in 2024 [6] - The company's future initiatives, such as unsupervised self-driving services and the production of Optimus robots, are seen as critical for its valuation, but their impact remains uncertain [7] - The core business struggles raise questions about the sustainability of Tesla's high valuation, suggesting potential for further stock decline [8]