New report flags additional risks for Tesla stock heading into 2026

Following recent warnings from figures like ex-board member Steve Westly, a December 30 analysis highlights further concerns for Tesla's stock performance into 2026, urging investors to reassess TSLA positions amid intensifying challenges.

A December 30, 2025, report has identified another red flag for Tesla Inc. (TSLA) stock as 2026 nears, building on earlier cautions such as Steve Westly's predictions of declining vehicle sales and profit pressures.

The analysis emphasizes strategic portfolio adjustments amid competition, regulatory hurdles, and questions around execution in autonomous driving and energy sectors. While Tesla's innovations drive optimism, volatility persists, prompting calls for reviewing earnings and forecasts.

This latest signal underscores the need for proactive investor decisions, without new executive quotes but reinforcing a cautious outlook for the year ahead.

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Illustration depicting Tesla stock's uncertain 2026 forecast, with diverging paths from decline to surge amid EV challenges and autonomous tech hopes.
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Analysts forecast uncertain path for Tesla stock in 2026

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Tesla's stock faces a pivotal year in 2026, with predictions ranging from a decline to $300 to a rise to $600, amid slowing EV sales and hopes for breakthroughs in autonomous driving and robotics. While revenue growth is expected to rebound modestly, challenges like expiring tax credits and competition persist. Bulls emphasize future technologies, but bears highlight current business struggles.

Steve Westly, a former Tesla board member, cautioned that the electric vehicle maker will face significant hurdles in maintaining its elevated stock valuation heading into 2026. He highlighted declining vehicle sales, profit pressures, and the need for progress in robotaxis and energy businesses. Investors, he said, will demand clear execution to justify current expectations.

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Tesla's stock has a history of sharp declines, and analysts now highlight intensifying challenges that could trigger further drops. Key concerns include margin pressure from price competition, eroding market share in China, and production setbacks with the Cybertruck and 4680 batteries. These factors threaten the company's growth narrative amid already strained financials.

Tesla's stock fell about 3% on Monday as investors prepare for the company's Q4 earnings release later this week. The report, due after market close on Wednesday, is seen as a critical test of CEO Elon Musk's promises on vehicle autonomy. Traders anticipate a significant price swing following the results.

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Tesla shares dipped slightly to around $447 on December 12, 2025, following a sharp 23% year-over-year U.S. November sales drop to 39,800 vehicles—the lowest since January 2022—and board member Kimbal Musk's $25.6 million share sale on December 9. This adds to recent pressures, including Morgan Stanley's downgrade last week, amid an 'EV winter' and divided analyst views.

Morgan Stanley has downgraded Tesla to equal weight from overweight, citing the stock's valuation already incorporating high expectations for AI and robotics amid slowing EV adoption. The firm slashed delivery forecasts, projecting a 10.5% decline in 2026 volumes. Shares fell around 3% following the announcement on December 8, 2025.

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Tesla shares dropped to $475.19 after hours on December 27, 2025, down 2% from levels near $485 earlier in the week, fueled by unsupervised robotaxi testing progress in Austin but offset by a California DMV proposal to suspend licenses over Autopilot marketing and ongoing NHTSA scrutiny into vehicle safety. Q4 delivery figures, due January 2, remain below expectations.

 

 

 

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