Why Shares of Tesla Are Sinking Today

Shares of the electric vehicle (EV) maker Tesla (NASDAQ: TSLA) traded roughly 3.3% lower as of 12:21 p.m. ET today. Sales continued to struggle in Europe and the stock also fell, despite an analyst recommending that investors hold the name.

Sales in Europe aren't improving

Tesla's stock has been hit hard this year, a big part of which can be attributed to struggling global sales. The company reported roughly 337,000 deliveries in its first quarter of the year, the lowest level in over two years. Some investors believe the struggles have resulted from CEO Elon Musk's involvement in politics, which has damaged the brand.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue »

Regardless of the reason, conditions don't seem to be improving. In April, data from the Spanish Association of Automobile and Truck Manufacturers showed that new Tesla sales fell 36% year over year, according to Reuters. Over the first four months, Tesla sales have decreased 17%, while EV sales in this time period, including hybrids, have surged 54%. It's a trend that has played out all year.

In other news, analysts at Jefferies reiterated their hold rating on Tesla, saying that "TSLA is now regaining some tech initiative with June's Robotaxi launch in Austin, but its edge may be scalability over technology as AV (autonomous vehicle) initiatives accelerate elsewhere."

Image source: Getty Images.

A lot riding on the June demonstration

With deliveries still apparently struggling, a lot is riding on Tesla's June Robotaxi demonstration that will supposedly feature the company's unsupervised full self-driving technology (FSD). Tesla trades at 135 forward earnings, much of which depends on the company's future initiatives.

The June demonstration could reinvigorate excitement around the stock; it also might come up short. I'm on the sidelines for now, given the big valuation and struggling core EV business.

Don’t miss this second chance at a potentially lucrative opportunity

Ever feel like you missed the boat in buying the most successful stocks? Then you’ll want to hear this.

On rare occasions, our expert team of analysts issues a “Double Down” stock recommendation for companies that they think are about to pop. If you’re worried you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:

• Nvidia: if you invested $1,000 when we doubled down in 2009, you’d have $296,928!*
• Apple: if you invested $1,000 when we doubled down in 2008, you’d have $38,933!*
• Netflix: if you invested $1,000 when we doubled down in 2004, you’d have $623,685!*

Right now, we’re issuing “Double Down” alerts for three incredible companies, available when you join Stock Advisor, and there may not be another chance like this anytime soon.

See the 3 stocks »

*Stock Advisor returns as of May 5, 2025

Bram Berkowitz has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Jefferies Financial Group and Tesla. The Motley Fool has a disclosure policy.