Tesla Inc. (TSLA) experienced a dramatic decline in its stock price, dropping over 10% on Monday and hitting its lowest level since the day before the presidential election. The shares have now plummeted approximately 50% from their record closing high of $479 set on December 17, 2022.

Wall Street's skepticism about Tesla's performance played a significant role in this downturn. Analysts from UBS released a report indicating that they have adjusted their price target for Tesla down to $225 from $259. This revision came in response to expectations of lower delivery numbers for the company’s popular Model 3 and Model Y vehicles due to declining demand. UBS now forecasts that Tesla will deliver only 367,000 vehicles in the first quarter, a significant drop from their previous placeholder estimate of 437,000 units.

The analysis suggests a troubling trend for Tesla, noting that delivery times for the Model 3 and Model Y have decreased to just two weeks in key markets—a sign of diminished demand. Additionally, Tesla's vehicle shipments to China plummeted by 49% year-over-year in February, marking the lowest shipment levels in nearly three years.

Despite the bleak outlook, some analysts remain optimistic about Tesla's future. Wedbush analyst Dan Ives emphasized the current market turmoil as a “gut check moment” but reaffirmed his support for Tesla, placing it on his firm’s “Best Ideas List” with an optimistic price target of $550. Ives recalled that similar downturns have occurred in Tesla's history, often overshadowed by negative market sentiment.

Morgan Stanley's analyst Adam Jonas also echoed a positive perspective, suggesting that Tesla's share price could rebound to $430 as the company diversifies into artificial intelligence and robotics. Jonas pointed out that while auto deliveries might wane annually, this could create a promising entry point for investors looking for long-term growth.

The decline in Tesla's sales can also be attributed to rising competition in the electric vehicle market and the impact of CEO Elon Musk’s political endeavors. His involvement as a key supporter of former President Trump during the 2024 campaign has reportedly affected consumer perceptions. Surveys indicate a notable percentage of voters disapprove of Musk's political engagements, raising concerns about potential backlash against Tesla.

As Tesla braces for its upcoming first-quarter earnings report scheduled for April 22, investors are left anxiously awaiting to see if the company can navigate through these turbulent waters and regain its footing in the rapidly evolving automotive landscape.