Given its admirable performance in 2023 and successes in navigating the broader electric vehicle (EV) market slowdown that sent some competitors like Lucid (NASDAQ: LCID) to all-time lows, Tesla (NASDAQ: TSLA) gave investors an unwelcome surprise with its 2024 decline.
Indeed, Elon Musk’s car and technology company is, at press time, on its longest losing streak since 2021, as it has experienced six consecutive weeks of decline amidst the ever-deepening EV market downturn.
Tesla has recently been facing a multitude of issues, including, for example, problems with Cybertruck battery production, and given that its Q4 earnings report detailed to stop the red tide, Finbold decided to consult the artificial intelligence (AI) of OpenAI’s flagship platform – ChatGPT – on what might ultimately pull the EV maker back into the green.
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ChatGPT outlines the prerequisites for a Tesla rally
When asked about the types of boons Tesla might need to end its losing streak and start rallying once more, ChatGPT offered a list of the 10 factors it considers the most important for Elon Musk’s EV company.
Given the recent developments pertaining to Tesla and the broader market – both positive and negative – several of the AI’s points stand out in particular.
Indeed, Tesla has taken several major hits on the revenue and earning side due to a long list of price cuts implemented to combat the demand slowdown, and a strong Q1 report in 2024 could reverse the downtrend.
Similarly, the company is facing a string of supply chain issues linked to production but also to transport – particularly to the Scandinavian countries – which have damaged investor confidence in Tesla’s ability to provide strong quarterly figures.
On the other hand, while the EV maker hasn’t been doing all that well when compared to what was broadly expected, it is important to note that its results have been, nonetheless, impressive.
The successes are particularly visible in terms of deliveries – with the company setting a new record in 2023 – and technology as a production breakthrough, first reported on in September, is set to allow the firm to start rolling out a new and relatively inexpensive model in the first half of 2024.
Additionally, Tesla is in the process of getting its foot in the door of a nearly untapped yet huge market – India – which might offer it an entirely new region for renewed staggering growth. Still, it is worth remembering that the Asian country’s EV market is nascent and untested – and historically, demand has been fairly low.
ChatGPT predicts possible turning point for Tesla stock
While ready and willing to assess the challenges facing Tesla, ChatGPT has been significantly more apprehensive when asked to predict a possible turning point for the company.
Ultimately, the AI offered – in very broad strokes – several events that might renew the EV maker’s rally: the upcoming earnings reports, unexpected government green energy regulation, or internal technological breakthroughs.
While avoiding providing specifics, it is true that a stronger-than-expected Q1 2024 report is likely to send Tesla surging – though, given that it is scheduled for mid-April, it is hard to predict what exactly will happen to the company in the preceding months.
Similarly, by their very nature, unexpected and positive green energy bills and unannounced technological breakthroughs, while almost guaranteed to skyrocket Tesla’s shares, can’t reliably be factored into an investment strategy.
Finally, when asked if there is a price that would constitute a value buying opportunity and that the EV maker’s stock is unlikely to go below, ChatGPT, after stressing the number is highly speculative, settled for $136.40.
It is also worth remembering that Wall Street analysts don’t entirely agree with such a price target as some, according to data retrieved from TipRanks, foresee Tesla falling as low as $23.53.
TSLA stock price analysis
In recent weeks, Tesla’s stock has been on a prolonged decline, having fallen 26.65% in the last 30 days and 26.23% since January 1. The company has also been in the red in the last 7 days, with a particularly large drop observable between January 24 and January 25 – after the Q4 earnings report was published.
The last full trading day, Friday, January 26, however, saw Tesla slightly in the green as the company’s shares rose 0.34% to $183.25, and the extended trading activity is also positive for the company as Monday’s pre-market saw Elon Musk’s firm rise 1.26%.
Despite this most recent performance, however, and despite Tesla’s 2023 growth, the company is in danger of having all of its 52-week gains erased as it is, by press time, up only 9.95% in that timeframe, and the most recent six months have been decisively grim sending the company as much as 31.48% into the red.
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Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
