Tesla (NASDAQ:TSLA) Stock: From Q1 Slump to May Surge – What’s Driving the Rebound?

TLDR:

Tesla stock is up 18% in May and 40% since April 22, despite dropping 15.44% since January CEO Elon Musk’s pledge to focus more on Tesla and less on White House duties has boosted investor confidence Tesla plans to launch a self-driving robotaxi service in Austin in June and a lower-priced model mid-year Analyst price targets vary widely from $115 to $450, with a consensus median of $284.23 Tesla’s board is exploring a new compensation package for Musk, following his contested 2018 options worth about $90 billion

---

Tesla shares have been on an impressive run recently, climbing 18% in May and 40% since reporting Q1 earnings on April 22. This surge comes after a difficult start to 2025, when the stock had fallen 15.44% since January and over 33% from its December 2024 peak.

Tesla, Inc. (TSLA)

The EV maker’s stock closed at $334.07 on Tuesday, its highest since February, despite posting weaker-than-expected Q1 results with a 13% year-over-year drop in deliveries.

Why Investors Are Returning

What’s behind this dramatic turnaround? For one, Elon Musk has promised to spend more time at Tesla and less in Washington, D.C. This announcement came as welcome news to investors worried about the CEO’s divided attention.

The company’s autonomous driving plans are also fueling optimism. Tesla confirmed it remains on track to launch its self-driving robotaxi service in Austin, Texas, this June.

Tesla’s announcement of a 90-day tariff pause between the U.S. and China has given shares breathing room. This development could help the company manage costs during a challenging sales period.

Baron Capital founder and Tesla shareholder Ron Baron expressed bullish sentiments Tuesday, suggesting that autonomous technology could dramatically expand Tesla’s profits.

Analysts remain divided on Tesla’s future, however. Goldman Sachs recently lowered its price target to $260 from $275, citing industry challenges in passing tariff costs to consumers amid softening demand.

New Products on the Horizon

Tesla plans to launch a lower-priced model mid-year, which could open new market segments. CFO Vaibhav Taneja believes this strategy of “providing the best product at a competitive price is going to be a winner.”

The company also sees its Full Self-Driving (FSD) features, including the pilot robotaxi launch, creating “a new era of demand,” according to Taneja.

Tesla’s recovery comes at a critical time for the EV industry. The company recently saw its share of the EV market drop below 50% in California, indicating increased competition.

Tesla is also pushing into other sectors beyond vehicles. The company continues to develop its energy business, AI initiatives, and humanoid robotics, diversifying its growth potential.

Executive Compensation on the Table

Reports suggest Tesla’s board is considering a new pay package for Musk. His last deal in 2018, which granted him some 300 million incentive-laden options worth approximately $90 billion at current prices, remains contested in Delaware courts.

A new compensation agreement would likely be substantial. Most investors favor keeping Musk at the helm despite controversies surrounding his leadership.

The board has not yet scheduled its annual shareholder meeting, which would be a natural forum to address executive compensation matters.

Since hitting its year-to-date low on April 8, Tesla stock has gained 44.84% through mid-May trading. This recovery suggests investors are looking past recent challenges toward future growth catalysts.

Wall Street analysts currently give Tesla a consensus “Hold” rating, with 16 “Buy,” 10 “Hold,” and 11 “Sell” recommendations among 37 analysts covering the stock.

The company’s 2025 outlook includes projected revenue growth to $117.2 billion, representing a 17.5% increase. Delivery forecasts for the year stand at 1.95 million units according to Barclays, below the Bloomberg consensus of 2.08 million.

Musk initially expected a 20-30% delivery increase for 2025, though management has since moderated expectations to a “return to growth.”

The company’s recent rally reflects a market that’s once again betting on Tesla’s innovation rather than its immediate financial results.

The post Tesla (NASDAQ:TSLA) Stock: From Q1 Slump to May Surge – What’s Driving the Rebound? appeared first on CoinCentral.