Negative news stories surrounding electric vehicle (EV) manufacturer Tesla (NASDAQ:TSLA) can be off-putting for investors. As the old saying goes, volatility can bring opportunity. As you encounter seemingly worrisome developments with Tesla, we encourage you to consider potential dip-buying strategies for TSLA stock.
For the foreseeable future, there will always be issues and controversies with Tesla and its mercurial chief executive, Elon Musk. Tesla stock gets a “B” grade and if the price is right, level-headed investors might soon have time to own shares at a discount.
Inauspicious Start to 2024 for TSLA Stock
As you may have noticed, EV stocks and technology stocks didn’t start off the year with a rally. Tesla stock is a perfect example of how the “Magnificent Seven” stumbled in early 2024, as it dropped 5% in the year’s first few trading sessions.
Not to toot our own horns, but we basically told you this would happen. In late December, we warned stock traders to expect “never-ending drama” with Tesla. Share-price volatility will be the norm with TSLA stock for a while, and investors need to accept this.
Late last year, we mentioned that Tesla had trouble manufacturing enough batteries for its Cybertrucks. It’s important to be aware of these issues, but sometimes the media is almost gleeful in reporting on Tesla’s and Musk’s problems.
For instance, CNN recently declared in a large-font headline, “Tesla recalls 1.6 million cars in China to reduce risk of collisions.” That’s ominous-sounding, but it’s not the end of the world for Tesla.
In reality, it’s not a traditional vehicle recall. It just requires a software upgrade for certain Tesla vehicles. The customers don’t even need to go to a Tesla store to get the required upgrade.
Focus on the Bigger Picture With Tesla
Sometimes, it almost feels like the media is trying to get people to panic-sell Tesla stock. For example, you may have heard that Tesla adjusted the range of its Model Y vehicle lower.
It’s really not earth-shattering news, as Tesla only lowered the vehicle’s estimated range by 6%. Besides, estimated vehicle-range adjustments aren’t unheard-of events.
In another example, the media reported that a Chinese automaker, BYD (OTCMKTS:BYDDY), surpassed Tesla as the world’s best-selling EV manufacturer. That’s a great story to get people’s attention, but it doesn’t significantly affect Tesla’s long-term growth story.
Lest we forget, Tesla delivered a record 484,507 vehicle deliveries in 2023’s fourth quarter, beating Wall Street’s consensus estimate of 483,173 EV deliveries. Moreover, Tesla met its full-year 2023 target of delivering 1.8 million vehicles.
More specifically, the company delivered 1.81 million EVs last year, representing 38% year-over-year growth. That should be the real headline story, and it’s not really constructive to obsess over which EV maker is in the number-one spot.
Consider Tesla Stock if It Drops on Negative News
Tesla is a powerhouse and a leader in the U.S. EV industry. Globally, Tesla is still among the leaders even if another company took the number-one spot.
Sure, Tesla and Musk will continue to provide fodder for sensationalism in the financial media. That’s par for the course with disruptive and innovative businesses. Despite the drama, TSLA stock deserves a confident “B” grade.
If the negative headlines cause Tesla stock to dip 5% to 10% from here, investors might consider buying a few shares. After all, volatility is normal and even “Magnificent Seven” stocks can’t just go up without taking breaks.
On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article.
