Tesla hit with stock downgrades after fallout between Musk and Trump

The downgrades mark the latest hurdle for Tesla, shares of which are down about 27% in 2025, making it the weakest performer of the so-called Magnificent Seven stocks

Mon, 09 Jun, 2025 - 16:52

Tesla was hit with a pair of downgrades on Monday, underscoring mounting concerns on Wall St about the electric vehicle maker’s outlook following last week’s clash between chief executive Elon Musk and US president Donald Trump.

Both Argus Research and Baird cut the stock to the equivalent of hold ratings, cementing Tesla’s reputation as the least-loved megacap stock among analysts. Shares fell 1.6% in premarket trading.

The downgrades mark the latest hurdle for Tesla, shares of which are down about 27% in 2025, making it the weakest performer of the so-called Magnificent Seven stocks.

Tesla shares had rallied in the wake of Mr Trump’s re-election, which Musk vigorously supported, but are down almost 40% off their peak in December.

Much of the stock’s recent decline came after the blowup between Musk and Trump last week. Mr Musk subsequently suggested he was open to making amends, but the tensions are seen as a significant headwind overhanging the shares.

The first round of negotiations since the teams met a month ago is aimed at restoring confidence that both are living up to commitments made in Geneva.

During those discussions, Washington and Beijing agreed to lower crippling tariffs for 90 days to allow time to devise ways to address a trade imbalance that the Trump administration blames on an unfair playing field.