Tesla Inc (NASDAQ: TSLA) shares closed last week Tuesday trading for US$274.45 apiece.
That represented a fresh 2023 high for the mammoth US tech stock. And it saw investors sitting on year to date gains of 154%.
Yep, that's no typo.
But the past week hasn't been nearly as favourable for shareholders.
Yesterday (overnight Aussie time) Tesla shares closed down 6.1% at US$241.05 per share. That puts Elon Musk's EV company down 12.2% in a week.
So, is the party over for this tech stock?
What's the outlook for Tesla shares?
There are still plenty of reasons to be bullish on the longer-term outlook for Tesla shares. And the stock is still up 133% so far this year.
Among the tailwinds ahead, Ford Motor Co (NYSE: F) and General Motors Co (NYSE: GM) both recently agreed to adopt Tesla's North American Charging Standard (NACS) across Canada and the United States.
Tiger Brokers Australia chief investment officer Brett Reynolds said, "With supportive announcements about the Tesla supercharging network, including Ford, GM and now Rivian committing to use it, there is a lot of positive news supporting the price rally."
However, a number of analysts – including those at Morgan Stanley and Barclays – believe the remarkable rally may be getting ahead of itself and have recently downgraded the stock.
Goldman Sachs joined the less bullish camp over the weekend, potentially helping fuel the overnight sell-off in Tesla shares.
Goldman Sachs analyst Mark Delaney downgraded Tesla from buy to neutral.
According to Delaney (courtesy of Yahoo Finance):
While the primary reason for the change in our view is that we think the market is now giving the stock more credit for its longer-term opportunities, we are also cognizant of the difficult pricing environment for new vehicles that we think will continue to weigh on Tesla's automotive non-GAAP gross margin this year.
Which isn't to say Goldman is bearish on Tesla shares.
"Overall, we believe our view that Tesla is well positioned for long-term growth … is now better reflected in the stock," Delaney said.
Among its long-term growth prospects, he cited Tesla's "leading position in the EV and clean energy markets, which we attribute in part to its ability to offer full solutions including charging, storage, software/FSD and services with a direct sales model".
Despite recommending investors reduce their exposure to Tesla shares, Delaney raised his price target to US$248 from US$185. That's 2.8% above the current price.
