Why is Tesla, Inc. stock underperforming the market?

Tesla's recent market performance shows a blend of promising long-term growth prospects and immediate challenges. The company reported fourth-quarter revenue of $25.71 billion, a 2% year-over-year increase, but below the Street consensus estimate of $27.26 billion. Earnings per share were 73 cents, missing the expected 76 cents. Despite record vehicle deliveries and energy storage deployments in the fourth quarter, Tesla experienced its first-ever annual decline in deliveries. Analysts remain optimistic about Tesla's long-term growth, particularly with advancements in Full Self-Driving (FSD) technology and the potential launch of robotaxis, which Bank of America analyst John Murphy suggests could account for nearly 50% of Tesla's valuation. The refreshed Model Y is seen as a key growth driver. However, Tesla faces challenges such as increased competition in the EV market, especially in China, and potential changes to the $7,500 EV tax credit that could affect demand. Goldman Sachs analyst Mark Delaney advises caution, noting that the ramp-up in FSD and other projects may take longer than expected. Overall, Tesla's market performance reflects a balance between promising opportunities and immediate challenges, with analysts maintaining a cautious yet optimistic outlook.