Tesla’s third-quarter earnings report drew mixed reactions from Wall Street despite CEO Elon Musk’s optimistic view that the electric vehicle company could one day be worth more than $4 trillion.
Tesla’s third-quarter report beat profit estimates but missed cash estimates, adding to fears that the company won’t be able to meet its long-term goal of 50% unit expansion this year.
Here are the key figures:
Revenue: $21. 45 billion, compared to analyst estimates of $21. 96 billion Adjusted earnings consistent with share: $1. 05, compared to analyst estimates of $1. 01 Adjusted automotive gross margin: 26. 8%, compared to analyst estimates of 27. 7%
The report prompted several price cuts at Wall Street banks. According to Wedbush, the company is likely to see a 45% increase in unit deliveries this year of 50%.
The potential shortfall, in fourth-quarter results, comes as the company has been hampered by constant disruptions in logistics and supply chain. Tesla’s inventory fell about 6% on Thursday.
This is how Wall Street reacts to Tesla’s third-quarter figures.
JPMorgan: “Most likely, the effects will add to the debate about demand destruction.
“We continue to see a threat to forecasts of annual unit volume expansion of 50% over time (a few more years, a few years less), adding higher prices, higher interest rates, an exploited customer and given the dearth of new style introductions, with Tesla’s lineup necessarily the same as in early 2021 after the latest Model S and X update, with the Cybertruck (originally planned for 2021) still available,” JPMorgan said.
“We remain cautious with valuation, against the backdrop of expectations for expansion of the volume of superior units, and we continue to see a significant problem threat to our December 2023 value target. “
Wedbush: “Tesla is coming to a crossroads in the road age where Musk wants to navigate the company. . . ” Target price: $300 vs. $360, reiterates “exceed. “
“This quarter, a respectable functionality in a very challenging environment with delivery and chain of origin issues at the forefront in Europe and China that yielded another dose of truth for Tesla that has been similar to Teflon in recent years despite chain of origin chaos around the world. “The bullish narrative is obviously “in a tough patch,” because Tesla now has to hit the streets as the physically powerful expansion story unfolds against a host of logistical issues, rather than weakening demand with everyone’s EV festival. and every angle of the world,” Wedbush said.
“Musk’s tone is very positive and he didn’t waver compared to previous comments about what Tesla sees in the market. That said, this quarter is not a rainbow or roses and that leaves investors without more than Tesla, which remains at a higher point. than any other automaker,” the analysts said, adding that the company could soon launch a $7 billion buyback given the drop in percentage price.
Goldman Sachs: “We expect investors to extract combined classes from this report. “Course objective: $305 (no change), reiterates “Buy”.
“We continue to say that Tesla is well placed for long-term earnings and earnings growth, given its leading position in the electric vehicle market, as well as in charging and EPS drivers. While we expect Tesla to decline the value of vehicles in the future, we believe charging drivers will come with scale at its new factories given that the consistent load with the vehicle in Austin and Berlin is expected to be much less than Fremont in the long run because Tesla uses a purpose-built electric vehicle factory in those locations and increasingly cutting parts/steps globally. In addition, we consider the IRA to be positive for its cargo design and worthwhile in the US. “The U. S. ,” Goldman Sachs said.