Tesla Bloodbath To Continue? Hedge Funder Says 'Musk Circus' Could Lead To Stock Dropping 95%

Tesla Inc TSLA stock is sliding Monday with the overall stock market amid concerns for the company's deliveries and continued protests against CEO Elon Musk and the company.

A Swedish hedge funder thinks it’s a matter of when, not if, Tesla shares will go lower in the future.

What Happened: Tesla has been one of the most volatile stocks since President Donald Trump won the 2024 election with a sharp rise after his victory before crashing in early 2025.

Swedish billionaire and hedge fund manager Christer Gardell thinks Tesla stock could decline even further in the coming months.

"Tesla, especially now with the whole Musk circus going on everywhere, is probably the most expensive stock on the global stock exchanges right now. It could go down 95% — and maybe it should go down 95%," Gardell said in an interview with EFN.

In the interview, Gardell said Tesla is a car company and the market is assigning a premium valuation due to energy, AI and robotics, as reported by Teslarati.

Gardell said Tesla is in an "eternal bubble" that could pop.

"I have commented that it should have burst over the past five years, but it still hasn't. The valuation is incomprehensible."

The hedge funder said when the crash comes, Tesla stock could fall dramatically and quickly.

"It's always hard to say when. It could happen in a month, six months, a year, three years, or five years – it's impossible to answer."

While Gardell focused on the overvaluation of Tesla stock, he said the U.S. stock market remains overpriced while Europe is offering value.

"American stocks have received very large flows recently. If you look at the American stock market, it is very expensive, both from a purely absolute perspective and from a historical perspective."

Gardell said European stocks trade at a discount of 40% to American stocks, compared to a normal discount of 20%.

Why It's Important: Musk's push into politics is creating more volatility for Tesla stock and leading to sales declines worldwide and protests at Tesla locations.

These events combined are seeing analysts and Tesla experts lower their delivery estimates for the first quarter.

In a Brand Finance survey, Tesla fell to 36^th place with a brand value of $43 billion. This was a drop from 18^th place in 2024 and a value of $58.27 billion.

This marked the second straight year Tesla’s brand value fell in the annual rankings, as reported by CNBC. Reasons for the fall could be related to a lack of new vehicles from Tesla and Musk’s “antagonism,” the report said.

Tesla's scores in categories such as “reputation,” “recommendation” and “consideration” all fell from the prior year.

Price Action: Tesla stock dropped 15.4% to $222.15 on Monday versus a 52-week trading range of $138.80 to $488.54. Tesla stock is down 41.4% year-to-date in 2025 and up 25% over the last year.

Tesla stock is now trading below where it was when Trump won the 2024 election. Tesla stock closed at $251.44 on Nov. 5 and opened for trading at $284.67 on Nov. 6 after Trump's victory was confirmed.

The stock is down over 50% from all-time highs set in December.

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