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- Tesla stock rose in premarket trading after closing more than 14% lower on Thursday.
- Elon Musk and President Donald Trump publicly traded barbs following criticism from the Tesla CEO.
- Trump threatened to cancel government contracts with Musk's companies amid escalating personal attacks.
Tesla rose 4.5% in premarket trading after plunging on Thursday following the public spat between CEO Elon Musk and President Donald Trump.
The EV maker's stock closed more than 14% lower after a barrage of posts from Musk attacking both the president and his "Big Beautiful Bill."
Tesla closed well below the $1 trillion market cap threshold after its worst single-day performance since March.
Analysts at Wedbush Securities including Dan Ives, a Tesla permabull, said in a Friday note they believed cooler heads would prevail.
"Musk needs Trump and Trump needs Musk for many reasons and these two becoming friends again will be a huge relief for Tesla shares," they wrote. "We will be monitoring the situation closely today but we believe Tesla shares are way oversold."
The feud between Musk and Trump began simmering earlier this week when Musk criticized the bill for what he called excessive spending.
By Thursday, tensions had escalated significantly. Trump said Musk was upset about the bill's phasing-out of EV tax credits, which could hurt Tesla.
Musk fired back and accused Trump of lying, before claiming credit for Trump's reelection.
"Without me, Trump would have lost the election," he wrote on X.
Trump responded by threatening to cancel federal contracts with Musk's companies, saying it would save "billions."