Tesla (NASDAQ: TSLA) is facing fresh legal trouble that could impact its valuation and investor sentiment.
In the latest development, shareholders have filed a class-action lawsuit against CEO Elon Musk and Tesla, alleging securities fraud for misleading the public about the safety and capabilities of its Full Self-Driving (FSD) and Robotaxi technology.
The lawsuit, covering April 2023 to June 2025, follows a June test in which Tesla’s Robotaxis exhibited erratic behavior, including sudden braking and unsafe maneuvers ahead of its rollout in Austin.
The renewed legal challenge is likely to weigh on TSLA’s stock, which is attempting to recover amid a difficult year. As of press time, Tesla shares were trading at $308.06, down almost 1% on the day and 18% year-to-date.
Tesla stock price prediction
To assess how the stock might react to the legal issues, Finbold consulted OpenAI’s ChatGPT, which outlined several possible scenarios. The AI noted that if the lawsuit gains momentum or prompts regulatory scrutiny, Tesla could face fines or be forced to revise its messaging around FSD and Robotaxi capabilities, potentially shaking investor confidence in a key growth area.
ChatGPT also pointed out that a significant portion of Tesla’s valuation is tied to expected revenue from autonomous vehicle technologies, such as Robotaxi deployment and FSD software licensing. Legal or regulatory setbacks could shift market sentiment and increase downward pressure on the stock.
In the short term, over the next one to three months, the AI model noted that Tesla’s stock is expected to trade between $275 and $295 amid ongoing negative sentiment and unresolved legal issues, as investors reduce risk exposure.
Over the medium term, spanning three to six months, ChatGPT projected that the stock could stabilize between $290 and $310, provided no further damaging revelations or regulatory actions emerge.
However, in a downside scenario involving deeper scrutiny or product recalls, Tesla’s stock could decline further, potentially trading between $240 and $270.
Going forward, ChatGPT stressed that key factors likely to influence Tesla’s stock include the progress of the court proceedings, potential regulatory investigations, and the company’s upcoming earnings report, especially any updates on FSD safety, monetization, or deployment timelines.
Featured image via Shutterstock
