Wells Fargo is predicting a major drop in Tesla’s stock price, despite the upcoming robotaxi launch. The bank believes Tesla’s core auto business is weakening, leading to a pessimistic outlook.
Weak Auto Sales, Aggressive Discounts
Analyst Colin Langan points to ongoing price cuts, disguised as financing promotions, as a sign of trouble. He notes that while listed prices seem stable, the actual cost to consumers is lower, impacting profit margins. This uncertainty about second-quarter margins is a key concern.
$120 Price Target: A 61% Drop?
Wells Fargo has given Tesla an “underweight” rating and a price target of $120 per share. This represents a potential 61% decline from Monday’s closing price. This bearish prediction comes despite the much-anticipated launch of Tesla’s robotaxi service in Austin.
Robotaxi Hype Won’t Save the Day
Langan believes that even the excitement surrounding the robotaxi launch won’t be enough to offset the weak fundamentals of Tesla’s core automotive business. He expects the initial rollout to be limited and unlikely to significantly impact the overall negative trend.
Tesla’s Struggles Continue
Tesla’s global deliveries are down 23% year-over-year, partly due to increased competition, particularly in China. The stock has already fallen over 22% in 2025 and nearly 10% in June alone.