Shares of Tesla (NASDAQ: TSLA) dropped Tuesday morning along with much of the rest of the market. As of 1:15 p.m. ET, the electric vehicle (EV) leader's stock was down by 3.6%, and the threat of increased competition was at least partially to blame. At that point in the session, the tech-heavy NASDAQ Composite index was down by a similar 3.7%.
Tesla shares still trade at what would be considered a sky-high valuation by traditional metrics. That valuation is based on the company's growth potential, of course, and it's rapidly expanding its production capacity as the electric vehicle market grows. So it didn't help when an analyst said he thinks a formidable competitor could take some market share from Tesla. The company in question surpassed Tesla as the world's top seller of EVs in the first half of 2022 if one also counts plug-in hybrid models.
Image source: Tesla.
Source Fool.com