Billionaire Ron Baron predicts Tesla share price will surge 550%
Ron Baron forecasts Tesla share price will climb 550%, reaching a $5 trillion market cap
Tesla shares dropped 15% on March 10, marking their steepest decline since 2020 and extending a 51% slide from December’s all-time high, wiping out over $700 billion in market value.
Despite disappointing sales and political controversy surrounding CEO Elon Musk, some investors still see massive long-term potential, reports Nasdaq.
Key Takeaways
- Tesla’s stock has plummeted 51% from its December high, wiping out over $700 billion in market capitalization — its sharpest single-day drop since 2020.
- In Q4 2024, Tesla reported a 2% revenue increase to $27.5 billion, a decline in operating margins, and its first-ever annual drop in deliveries — missing Wall Street’s earnings estimates in five of the last six quarters.
- Despite recent setbacks, hedge fund manager Ron Baron believes Tesla could become a $5 trillion company within a decade, with upside driven by electric vehicle leadership, profitability, and advancements in autonomous driving and robotics.
Stock Performance and Market Reaction
Tesla’s 15% drop on March 10 marked its worst trading session in nearly four years, contributing to a staggering 51% decline from its December peak. The significant pullback wiped out more than $700 billion in market value, signaling growing concerns among investors about a combination of factors.
Tesla Inc (TSLA) share price dynamics (2020 - Mar 2025) Source: TradingView
These include disappointing sales numbers, particularly in key markets such as the U.S., Europe, and China, as well as rising unease over CEO Elon Musk’s increasing political involvement. Musk’s behavior, which has drawn both praise and criticism, seems to have influenced consumer demand for Tesla vehicles, further compounding the company’s challenges.
Sales Slowdown and Financial Pressures
Tesla’s fourth-quarter results disappointed investors, with sales rising just 2% year-over-year to $27.5 billion. The company recorded its first-ever annual decline in vehicle deliveries and saw a 200-basis-point drop in operating margin. Non-GAAP earnings rose just 3% to $0.73 per share — Tesla’s fifth earnings miss in the last six quarters.
The trend continued into early 2025 as Tesla lost market share in key regions like the U.S., Europe, and China, raising further concerns about weakening consumer demand and competitive pressures.
Long-Term Growth Potential
Despite short-term struggles, Tesla retains its leadership in the global electric vehicle market and remains the only automaker capable of producing profitable electric cars, according to Argus analyst Bill Selesky.
Billionaire investor Ron Baron remains bullish on Tesla’s future, forecasting a $5 trillion market cap within the next decade — implying a 550% upside from the current $764 billion valuation. Promising updates on autonomous driving and robotics from Tesla’s recent earnings call also support the company’s long-term growth thesis.
Tesla’s sharp stock decline and weak quarterly results highlight short-term challenges, but its strong position in the electric vehicle market and potential in autonomous driving and robotics leave room for optimism. Long-term investors betting on innovation and profitability may still see significant upside ahead.
As we wrote, Uber CEO Dara Khosrowshahi expressed optimism about working with Tesla and Elon Musk as the company prepares to launch its robotaxi service.
