John Csiszar

Wed, May 28, 2025, 2:03 PM4 min read

Tesla seems to always be in the news, whether it’s about the company’s groundbreaking technology, its delivery numbers or its mercurial CEO, Elon Musk. But over the past six months or so, politics has crept into the discussion regarding Tesla alongside its finances — and some analysts, like those at J.P. Morgan, think that it’s a big problem for the company.

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Here are the reasons Tesla has been a rollercoaster over the past six months, why J.P. Morgan analysts think the company has problems and whether or not Tesla shares may still make a good investment.

Tesla has always been a wild stock, and investors have learned to anticipate big swings in its price. With a beta around 2.50, the stock is more than 2.5 times as volatile as the overall market. What’s that like for investors?

It means you have to be prepared for big swings if you’re a Tesla investor. Just over the past few months, the stock fell from a high of $483.99 on Dec. 17, 2024, to a low of $217.02 on Mar. 11, 2025 — a 55% drop. Since then, the stock has rallied back to $339.34 as of May 24, a gain of 56%.

A combination of factors has contributed to Tesla’s most recent wild ride. As CEO Elon Musk began collaborating with President Donald Trump, the stock soared as investors anticipated beneficial treatment for the company. But as Musk began to spend more time on his role at the Department of Government Efficiency (DOGE), investors worried that Tesla’s CEO wasn’t focusing on his own company.

Coupled with falling deliveries, increased competition and political backlash towards Musk, the stock is still down 16% on a year-to-date basis.

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Beyond the economics that are causing problems at Tesla currently, J.P. Morgan analysts are more concerned with the political damage that Musk’s close relationship with Trump has caused.

The political divisiveness this relationship has caused, according to J.P. Morgan auto analyst Ryan Brinkman, is driving away far more buyers than it is gaining. This has led Brinkman to cut his estimate for global Tesla deliveries in Q1 to 355,000 vehicles, down from 444,000.

As Brinkman wrote in a research note, “We struggle to think of anything analogous in the history of the automotive industry, in which a brand has lost so much value so quickly.”