Tesla Stock’s Rally Hits the Brakes: Time to Sell?

Core Viewpoint - Tesla's stock has experienced significant volatility, recently falling to around $400 per share after facing resistance near $470, raising concerns among investors about the future trajectory of the stock amidst a broader tech market downturn [1][2]. Company Performance - Tesla's shares dropped nearly 10% over the past five sessions, trading at 181 times forward earnings, indicating a high valuation relative to earnings [6]. - The company received a ride-hailing permit from Arizona for its robotaxi rollout, which could enhance its market position in the autonomous vehicle sector [6]. Market Sentiment - There is a growing bearish sentiment towards Tesla and other AI-related stocks, with notable investors like Bill Gates reportedly betting against Tesla, although it is unclear if he still holds a short position [2]. - The emergence of short-sellers and calls for a correction in the tech sector suggest a challenging environment for net buyers of big tech stocks [3]. Investment Outlook - The valuation of Tesla remains complex, with opinions divided on whether it is undervalued or overvalued compared to other AI stocks. The company is considered one of the more difficult stocks to value among the "Magnificent Seven" tech stocks [5]. - Analysts have raised Tesla's price target to $508 from $483, driven by optimism surrounding its full self-driving technology [6].