Please ensure Javascript is enabled for purposes of website accessibility

Why Tesla Stock Plummeted Monday

By Daniel Sparks - Mar 16, 2020 at 1:17PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Shares of the electric-car maker are now down more than 50% from all-time highs.

What happened

Shares of electric-car company Tesla (TSLA 1.24%) were slammed on Monday. The stock fell as much as 19.1%. As of 1:27 p.m. EDT, however, the stock was down about 15%.

The stock's sharp decline is likely due to the market's overall sell-off on Monday. Growth stocks like Tesla were hit particularly hard. But a lowered price target for the stock by a Wall Street analyst likely also played a role in the stock's decline.

A white Model X with its falcon wing doors open

Image source: Tesla.

So what

RBC Capital Markets analyst Joseph Spak cut his 12-month price target for Tesla stock from $530 to $380 on Monday, citing a challenging environment for luxury autos amid the coronavirus panic. He said he now expects Tesla to deliver 364,600 vehicles in 2020 -- well below management's guidance for more than 500,000. 

Meanwhile, the S&P 500 is down more than 9% at the time of this writing, reflecting the market's continued panic about the economic implications of the coronavirus impact in the U.S. and other countries around the world.

Now what

Investors will get their first update on how Tesla's deliveries are faring in 2020 when the automaker reports first-quarter deliveries. The company typically reports deliveries one to three days after every calendar quarter ends.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Tesla, Inc. Stock Quote
Tesla, Inc.
$681.79 (1.24%) $8.37

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 07/02/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.