So much for the Tesla Stock (TSLA) rally.
Shares of the EV maker fell more than 4% in premarket trading on Friday after U.S. prices for the Model 3 and Model Y were cut. The stock had gained about 9.5% over the past five sessions as traders speculated it would bottom out after a 65% drop in 2022.
Tesla has slashed the base Model 3 by $3,000 to $43,990, according to an update on its website. The Model 3 Performance variant saw a price drop from $9,000 to $53,990.
The Model Y Long Range was priced $13,000 lower at $52,990. The Performance model has been discounted to $56,990, about $13,000 cheaper than the previous price.
The U.S. price cuts follow recent cuts in China, Japan and South Korea as Tesla seeks to reignite demand amid growing competitive threats.
Media and guests surround the Tesla Model Y and Model 3 during the official launch event of Thailand Tesla in Bangkok, Thailand December 7, 2022. Portal/Athit Perawongmetha
Citi analyst Itay Michaeli, meanwhile, took a more cautious stance on the company’s upcoming earnings.
In a new note, Michaeli lowered its delivery estimate for 2023 to 40% growth from a previous 53%. The analyst lowered his price target on Tesla to $140 from $176, but maintained a neutral rating.
“We are positive about Tesla’s strong global premium EV position and particularly the company’s improved execution over the past few years,” said Michaeli. “However, we are more skeptical of the company’s approach to autonomous driving/autonomous vehicles (AV), which we view as a critical contributor to the overall risk-reward assessment given our positive stance on the AV opportunity as a whole.”
Brian Sozzi is a freelance writer and anchor at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.
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