Core Viewpoint - The "Big Beautiful Bill" supported by President Trump and Congress is expected to negatively impact Tesla by increasing costs for consumers purchasing electric vehicles and reducing credits for EV companies [1][3]. Group 1: Analyst Downgrade - William Blair analyst Jed Dorsheimer downgraded Tesla stock from "Outperform" to "Market Perform" without providing a price target [2]. - Dorsheimer believes the recent bill could be too challenging for Tesla stock to recover from [3]. Group 2: Impact of the Bill - The removal of the $7,500 EV tax credit for consumers is anticipated to reduce demand for Tesla vehicles, while the elimination of corporate average fuel economy (CAFE) fines was unexpected and necessitates a reset [3][4]. - Dorsheimer noted that Tesla earned $2.8 billion from selling regulatory credits in 2024, which constituted 16% of its total gross profit, and the loss of these credits could significantly affect profitability [4]. Group 3: Revenue and Demand Concerns - It is estimated that 75% of Tesla's regulatory credit revenue is tied to CAFE standards, which will be eliminated by 2027 [5]. - The combination of weakened demand and reduced profits from regulatory credits may create substantial challenges for Tesla, particularly in the fourth quarter [5]. Group 4: Investor Sentiment and Stock Performance - Dorsheimer indicated that investors may be growing weary of distractions from CEO Elon Musk, especially when the business requires his focus [6]. - Tesla stock is currently trading at an enterprise value of 76 times its lowered 2026 EBITDA estimates, reflecting investor concerns [6]. - As of the latest trading session, Tesla stock increased by 1.3% to $297.81, but it has declined by 20.4% year-to-date in 2025 [7].