Tesla, Inc. TSLA shares experienced a marked decline on Thursday following the release of the company’s fourth-quarter results and made a slight recovery on Friday. With the stock trading in the oversold region, is it an appealing prospect at current levels?
What Led to the Decline: Tesla closed Thursday’s trading down 12.13% at $182.63, according to market data. This marked the lowest level since May 25, 2022. The stock saw a minimal rebound of 0.34% on Friday, ending at $183.25.
The 14-day relative-strength index of the stock is currently indicative of oversold levels.
Chart Courtesy of Benzinga
See Also: Everything You Need To Know About Tesla Stock
Observations on Stocktwits revealed that despite the setback, Tesla’s stock has stayed on a long-term upward trajectory. According to the chart, originating from the beginning of 2020, each time the stock has experienced a downturn, formed a long-tailed candle, and intersected this trendline, it has rebounded robustly. A long-tailed candle symbolizes a rejection of lower prices.
Relevance of the Phenomenon: Tesla is currently confronted with a near-term deceleration lacking substantial catalysts, although occasional fluctuations may arise from vehicle price adjustments. The stock could be influenced in the near term by the impending first-quarter deliveries in early April. Furthermore, any updates on the company’s next-gen electric vehicle, the timeline of the Giga Mexico factory, or an entry into the Indian market might prompt movement.
Post the fourth-quarter earnings release, analysts have lowered their estimates for the company and revised down their price targets for the stock. Despite these adjustments, the average analysts’ price target of $222.36, as per data compiled by TipRanks, indicates a potential upside of over 21%.
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