Tesla (NASDAQ:TSLA | TSLA Price Prediction) stock took a beating on Thursday after the automaker released its second-quarter 2025 earnings report. The stock has staged swift comebacks in the past. So, traders might wonder whether TSLA stock can get back to its previous short-term peak of around $400.
There’s no shortage of Tesla stock price forecasts, and dip buyers may be tempted to grab some shares now. It’s possible that TSLA stock will bounce back to $400 before the summer’s over, but is this realistic? Instead of guessing and hoping, let’s check the facts and see if there’s really a bargain here for Tesla enthusiasts.
Putting the Dip in Perspective
Tesla stock took a haircut Thursday, shedding 8.2% and landing at $305.30. It was a rough day for Tesla’s loyal shareholders, no doubt.
With that, TSLA stock was down around 24% year to date. Does this necessarily mean Tesla is a prime bargain, destined to return to $400 in the coming weeks?
Hold your horses. As the old Benjamin Graham/Warren Buffett saying goes, price is what you pay but value is what you get. Just because the Tesla stock price is down, this doesn’t necessarily mean it’s cheap and primed for a recovery.
To put this dip in perspective, Tesla stock is still up 42% over the past 12 months and up by more than 200% over the past five years. Sure, TSLA stock has always bounced back from previous dips, but sometimes it took more than a few weeks.
In this instance, a summertime comeback isn’t assured. If the data looks really bad, then maybe the stock-price pullback is justified.
A “Garbage” Earnings Report?
Quite bluntly, Gerber Kawasaki Wealth & Investment Management CEO Ross Gerber called Tesla’s Q2 2025 earnings report “garbage.” Is this assessment too harsh, though?
Starting with the top-line stats, the analysts’ consensus estimate called for second quarter revenue of $22.64 billion. What Tesla actually delivered was $22.496 billion in revenue, so this was a miss but not an extremely wide one.
Still, this marks a fall-off for Tesla. In the year-earlier quarter, Tesla had generated $25.5 billion in revenue. So far, not so good.
Digging deeper into the data, Tesla’s Q2 2025 income from operations totaled $923 billion. Analysts wanted to see $1.23 billion, so it’s understandable that traders with high hopes were disappointed.
Moreover, Tesla reported second-quarter 2025 earnings of $0.33 per share, versus $0.40 per share in the year-earlier quarter. These quarterly earnings figures are low when compared to the TSLA stock price of over $300.
At this rate, Tesla’s price-to-earnings (P/E) ratio could remain in the triple digits for the foreseeable future. As of July 24, Tesla’s P/E ratio stood at 173.47x, which could make value-focused investors uncomfortable.
Prepare for a “Few Rough Quarters”
Looking ahead, Tesla CEO Elon Musk warned that there may be a “few rough quarters” in store for the automaker. Elon might have been alluding to the $7,500 federal tax credit for electric vehicles (EVs) expiring at the end of 2025’s third quarter.
Because of the imminent end of those tax credits, Tesla CFO Vaibhav Taneja anticipates a “pull forward” in vehicle sales. Taneja added, “Given the abrupt change, we have limited supply of vehicles in the U.S. this quarter.”
The upshot, Taneja warned, is that Tesla “may not be able to guarantee delivery orders placed in the later part of August and beyond.” Thus, Tesla’s problems aren’t limited to the second quarter and indicate headwinds throughout the year.
We observed that the dip in TSLA stock wasn’t really a big dent in the grand scheme of things. As traders process Tesla’s ongoing problems, it’s unlikely that Tesla stock will miraculously recover its losses and jump to $400 before the summer ends.
Forgiveness Fatigue
In the past, many of Tesla’s shareholders were so loyal that they would forgive just about any of the automaker’s shortcomings. Given the company’s aforementioned issues, however, TSLA stockholders might be succumbing to “forgiveness fatigue.”
Or, as Wedbush Securities analyst Dan Ives put it, “The Street is losing some patience” with Tesla. The company no longer seems to have the White House’s support, and in light of the recent numbers, Tesla needs to deliver a more impressive earnings report in three months.
That’s why I don’t expect Tesla stock to rapidly recover to $400 this summer like it might have done in the past. Tesla appears to have lost its halo effect and is now a “show-me” story. The prudent strategy, then, is to steer clear of TSLA stock until that story changes for the better.
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