Tesla Just Hit a Fork in the Road—Could the Bulls Lose Control?

Core Viewpoint - Tesla's recent earnings report showed mixed results, with revenue declining nearly 12% year-over-year but non-GAAP EPS at $0.40, indicating some recovery potential despite high investor expectations [2][4][9] Financial Performance - Revenue declined nearly 12% year-over-year, but the decline was not as severe as anticipated [2] - Non-GAAP EPS was reported at $0.40, indicating profitability [2] - Deliveries increased compared to Q1, and margins showed improvement, suggesting a potential recovery phase for the company [2][4] Market Reaction - Following the earnings report, Tesla's stock price fell more than 6% ahead of Thursday's open, reflecting cautious investor sentiment [2][10] - The stock's P/E ratio is around 180, indicating high expectations that may not have been met [2][3] Long-term Outlook - CEO Elon Musk confirmed plans for a lower-cost vehicle by the second half of 2025 and a robotaxi rollout expected to reach half of the U.S. population by year-end, which could support long-term growth [4][9] - Analysts from Wedbush reiterated an Outperform rating with a price target of $500, suggesting a potential upside of approximately 50% [7][8] Investment Sentiment - Despite short-term corrections, there is a belief that the stock could rebound if investor sentiment aligns with improving deliveries and product innovation [10][11] - The market tends to look forward, especially for a brand like Tesla, which is showing signs of stabilization [9]