JPMorgan Warns Tesla (TSLA) Stock Could Plunge 60% — Analyst Breakdown

Quick Summary

• Ryan Brinkman from JPMorgan maintains a Sell rating on Tesla stock with a $145 price target — representing a potential 60% decline from current prices
• First quarter 2026 deliveries totaled 358,023 vehicles, undershooting projections and dropping 14% sequentially
• The automaker manufactured 50,363 more cars than it sold during Q1, driving inventory to an unprecedented ~164,000 vehicles
• Earnings estimates were reduced: Q1 EPS now projected at $0.30 (down from $0.43), full-year EPS cut to $1.80 (from $2.00)
• With a 20% year-to-date decline, TSLA ranks as the poorest performer among the Magnificent Seven stocks

JPMorgan analyst Ryan Brinkman maintains a decidedly pessimistic outlook on Tesla — and he’s making his position crystal clear.

On Monday, Brinkman reaffirmed his Sell recommendation on Tesla (TSLA), holding firm to his $145 price target. This forecast suggests a potential decline of approximately 60% from the stock’s current price near $354.

Tesla, Inc., TSLA

The analyst’s assessment comes on the heels of Tesla’s first quarter 2026 delivery figures, which showed 358,023 vehicles delivered. While this represents a 6.3% increase compared to the same period last year, the number fell short of analyst projections ranging from 366,000 to 370,000 units and declined 14% versus the fourth quarter of 2025.

According to Brinkman, these figures landed 4% beneath Bloomberg’s consensus estimate and 7% under JPMorgan’s internal projections. The shortfall is significant.

Beyond the delivery numbers themselves, what particularly alarmed Brinkman was the inventory accumulation. Tesla manufactured 50,363 more vehicles than it sold during the quarter. This production-delivery gap pushed the company’s estimated total inventory to an all-time high of 164,000 vehicles — marking the largest single-quarter inventory increase on record.

This mounting inventory translates to substantial capital locked in unsold vehicles. Brinkman cautioned that this situation, coupled with increased capital expenditure plans for 2026, will significantly strain free cash flow generation.

His revised earnings projections reflect these concerns: the Q1 EPS estimate was trimmed to $0.30 from $0.43, while the full-year 2026 EPS forecast was lowered to $1.80 from $2.00.

Multiple Challenges Impacting Demand

The elimination of the EV tax credit certainly didn’t help matters. The $7,500 federal incentive for electric vehicle purchases expired at year-end, dampening U.S. consumer demand. Elevated interest rates have simultaneously made vehicle financing more costly across the board.

Tesla also confronts intensifying competitive pressure from BYD, Mercedes-Benz, GM, and Ford, all of which continue expanding their electric vehicle portfolios.

The energy storage division presented additional concerns. Tesla’s energy storage deployments fell 15% year-over-year to 8.8 GWh — marking the first annual decline since the second quarter of 2022, Brinkman noted.

Optimistic Investors Cite Robotaxi and Optimus Potential

Tesla bulls anchor their investment thesis on forthcoming innovations. CEO Elon Musk has characterized 2026 as a pivotal year, with the Cybercab — Tesla’s autonomous robotaxi lacking a steering wheel — scheduled to enter initial production this month.

Musk is simultaneously advancing the Optimus humanoid robot project, aiming for factory deployment in repetitive-task applications by year-end.

Brinkman recognized that execution risks surrounding these products have diminished somewhat. However, he emphasized that entering higher-volume, lower-price-point market segments introduces substantial demand uncertainty and competitive challenges.

Analyst sentiment remains divided. Tesla currently holds 13 Buy recommendations, 11 Hold ratings, and 8 Sell ratings. The consensus price target stands at $393.97, suggesting approximately 12% potential upside — dramatically different from JPMorgan’s bearish $145 projection.

TSLA shares have declined 20% year-to-date in 2026, making it the worst-performing stock within the Magnificent Seven cohort.

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