Tesla falls 3.5% amid Autopilot verdict, weak FSD demand; DCF shows steep overvaluation

Summary

Tesla, Inc. (TSLA) closed at $333.87 on 08/29/2025, down 3.50%. Market cap is $1.08 trillion. Recent headlines on an Autopilot wrongful-death verdict and survey results showing weak consumer interest in FSD have increased legal and demand uncertainty. Technicals show neutral momentum; fundamentals show a valuation priced for high growth that is not supported by the provided DCF.

Technical Snapshot

- Close: $333.87 (08/29/2025).

- Intraday range: $331.70–$348.75.

- 50‑DMA: $323.79; 200‑DMA: $330.04 (price above both).

- RSI (14): 47 (neutral).

- MACD (3M): 7.82 (positive momentum).

- ATR: $3.80 (typical daily move).

- Volume: 80.77 million vs. avg 98.24 million (down on the sell-off — weaker conviction).

- Key levels: support $329.65; resistance $340.47; stop-loss level shown $317.91.

Interpretation: Price sits above both moving averages, indicating medium-term technical support, but the pullback occurred on below-average volume and RSI is neutral — a consolidation rather than capitulation. Failure to hold $329.65 would invite testing of the $317–$320 zone.

Fundamental Snapshot

- EPS (TTM): $1.70; P/E: 196.39.

- Market consensus targets: high $500.00, low $137.00, consensus $363.08, median $380.00. Analyst coverage: 33 buy, 29 hold, 17 sell (consensus: Buy).

- DCF-derived fair value (provided): $55.04 per share.

Interpretation: Trailing earnings are low relative to price, producing an elevated P/E that embeds aggressive growth assumptions. The DCF indicates a very large valuation gap versus the market price, implying that the current market price requires substantial and sustained operational outperformance versus conservative cash‑flow assumptions.

News Impact

- Multiple filings on 08/29/2025 seeking to overturn or retry a $243 million verdict in an Autopilot-related wrongful-death suit increase legal risk and potential headline-driven volatility.

- A survey published 08/29/2025 finding limited incremental demand from FSD weakens the narrative that FSD alone will materially expand TAM in the near term.

Net effect: Near-term negative sentiment and headline risk; potential for litigation costs, reputational effects and slower FSD monetization to pressure margins and adoption.

Next Trading Day Outlook — 09/02/2025

- Base case (60%): Rangebound session between $330.00–$340.00, choppy trade with a slight downward bias as investors digest legal headlines.

- Downside risk (25%): Test of support near $329.65 and intraday probe toward $320.00 if selling intensifies.

- Upside scenario (15%): Bounce to $345.00+ on dip-buying or favorable legal news.

Reasoning: Negative headlines arrived after the close on 08/29; momentum indicators are neutral and volume on the drop was below average — likely intra‑day consolidation and sentiment-driven swings rather than trend reversal.

Weekly Outlook (next 5 trading days)

- Most likely: Consolidation in a $320.00–$360.00 band with headline-driven spikes (55%).

- Bear case: Continued downward drift to $300.00–$320.00 if legal rulings or weakened FSD adoption data compound sentiment (25%).

- Bull case: Rebound toward analyst consensus $360.00–$380.00 if broader market risk appetite returns and no adverse legal developments (20%).

Volatility expectations are elevated given legal uncertainty and mixed fundamental signals.

Intrinsic Value & Long-Term Potential

- The supplied DCF fair value of $55.04 implies the market price is pricing in expectations materially above conservative cash‑flow assumptions. This suggests limited margin for error: execution shortfalls, legal liabilities, or weaker-than-expected FSD/energy adoption would translate into sizable downside versus current levels.

- Offsetting factors: leadership in EV scale, energy products, potential AI/FSD upside if regulatory and adoption hurdles are cleared, and a large global TAM. If Tesla sustains high growth, margin expansion and recurring software/robotaxi revenue, current multiples could be justified over a multi-year horizon.

- Conclusion: Long-term upside exists but is contingent on execution and successful resolution of technical, regulatory and legal risks. Using the provided DCF, intrinsic value is far below market price; a bullish long-term case requires assumptions well above those implied in the DCF.

Overall Evaluation

Hold

Rationale: The stock exhibits mixed signals — positive momentum (above DMAs, positive MACD) and analyst bullishness versus clear overvaluation by the supplied DCF, elevated P/E, and fresh legal and product adoption headwinds. Short-term volatility and headline sensitivity are elevated. For investors seeking exposure to Tesla’s long-term optionality, a measured approach that monitors legal outcomes, FSD adoption metrics and margin trends is warranted; for those focused on valuation based on conservative cash flows, current levels look richly priced.