Vanda Research Says Retail Investors are Buying the Tesla Stock Dip. Should you?

Shares of Tesla (TSLA) have had a rough 2026 so far. TSLA stock is down 23% year-to-date (YTD), making it one of the worst performers in the “Magnificent Seven” group of tech giants this year. Yet retail investors are not running away — they're buying more.

That raises a fair question for anyone with money on the line: is this a smart bet or a costly mistake? Let's take a closer look.

Retail Investors Are Piling Into Tesla Stock 

According to a recent note from Vanda Research, as of April 8, retail buyers poured roughly $256 million into Tesla shares over just five trading days. That stands out because the broader picture for retail flows has become more cautious. 

Retail demand for other major tech stocks — such as Nvidia (NVDA), Meta Platforms (META), and Microsoft (MSFT) — has cooled off. Vanda noted that retail investors overall are becoming "more tactical" and "increasingly selective," with a growing preference for defensive plays. Tesla is the exception, given the dip, with buyers showing up in size.

The enthusiasm makes some sense when you zoom out. Tesla CEO Elon Musk laid out an ambitious roadmap on the company's fourth-quarter 2025 earnings call. Musk described plans for a million-unit-per-year Optimus robot factory in Fremont, California, a paid Robotaxi rollout in Austin, Texas, with no safety monitor in the vehicle, and what he called an "epic" capital investment year with more than $20 billion in planned spending. 

The message? Tesla is betting heavily on its own future.

Tesla's Q1 Numbers Disappoint

Tesla produced 408,386 vehicles and delivered 358,023 in the first quarter of 2026. That fell short of what Wall Street was expecting. The sell-side consensus, compiled by Tesla itself from 23 analysts, had called for roughly 365,645 deliveries. Essentially, Tesla missed estimates by about 7,600 vehicles.

Yes, deliveries were up about 6% year-over-year (YOY). But that comparison is against a weak prior-year period, and the sequential drop from Q4 2025 was significant. Energy storage deployments also totaled 8.8 gigawatt-hours (GWh), falling short of the 14.4 GWh that analysts had penciled in.

The headwinds are real. The $7,500 federal electric vehicle (EV) tax credit expired in September 2025, taking a bite out of U.S. demand. Elevated interest rates have also made car financing more expensive for buyers. Finally, competition from Chinese rivals like BYD (BYDDY) and legacy automakers continues to intensify.

Reuters recently reported that Tesla is in the early stages of developing a smaller and cheaper SUV built in China. The company has allegedly contacted suppliers. But this rumor warrants skepticism, as Musk scrapped a similar plan in 2024, calling a bare-bones cheap EV "pointless" and out of step with Tesla's mission.

JPMorgan Is Bearish on TSLA Stock

JPMorgan analyst Ryan Brinkman recently reiterated a “Sell” rating on TSLA stock and maintained a $145 price target. At the time of this writing, TSLA stock trades near $347, indicating potential downside of over 58% from here. 

Brinkman explained that consensus estimates for Tesla have largely declined through 2030. Basically, investors expect Tesla to stage a turnaround after 2030. However, the EV stock continues to trade at a premium. 

In plain terms, investors should remain patient for the thesis to pay off, and a lot has to go right first. Retail investors are clearly willing to make that bet. Whether you should join them depends on how much faith you have in Musk's long-term vision — and how much volatility you can stomach along the way.

Tesla currently has a consensus “Hold” rating. Out of the 43 analysts covering TSLA stock, 15 recommend a “Strong Buy” rating, two recommend a “Moderate Buy,” 16 recommend a “Hold” rating, and 10 recommend a “Strong Sell.” The average TSLA stock price target is $403.47, implying potential upside of 16% from current levels.