Tesla's Q4 performances outpace expectations - sustaining the surge?
Hey there! Let's dive into the latest developments with Tesla, shall we?
Tesla has been on a rollercoaster ride recently. First, the stock took a plunge due to the whole Twitter-Elon Musk debacle, followed by disheartening delivery numbers confirming the downward trend. However, in the past few weeks, the stock has made a spectacular comeback and has been significantly in the green before the quarterly earnings report.
Pumped-up Expectations
But the anticipation for Tesla's stock was high. It wasn't just about the predicted EPS of 1.15 US dollars, but primarily about Elon Musk's stance, particularly regarding his position as Twitter CEO and the murmurs about him constructing a successor for the automaker.
He was expected to assure investors mainly during the analyst call about his commitment to the automaker amidst the rumors. It's worth mentioning that he's been vowing to increase his involvement at Tesla since May, aiming to address operational challenges.
Healthy Numbers
Despite the underwhelming delivery figures, Tesla announced impressive numbers on Wednesday evening, surpassing EPS expectations with 1.19 US dollars, while revenue stayed within the analyst consensus. The gross margin in the automotive sector also exceeded expectations, coming in at 28.5 percent, higher than last year.
However, the market responded ambiguously to these numbers. One reason for this mixed reaction is the significantly decreased free cash flow and the uncertainty ahead of the upcoming analyst call.
To Buy or Not to Buy?
But is the stock a buy after the numbers? At least if we consider the analysts' ratings, who see an average price target of 199.60 US dollars.
However, the stock's movement could again heavily depend on Elon Musk, so investors should only consider an investment if they're willing to tolerate the corresponding volatility.
By the way: Cathie Wood recently sold her favorite stock - should you too?
Disclosure: The author holds direct positions in the financial instruments mentioned in the publication, which could benefit from the potential price development resulting from the publication: Tesla.
- Despite the mixed market reaction, Tesla's earnings report showed revenue staying within the analyst consensus, exceeding expected EPS with 1.19 US dollars, and a higher gross margin in the automotive sector of 28.5 percent.
- Amidst the anticipation for Tesla's stock, Elon Musk was expected to reassure investors about his commitment to the automaker during the analyst call, especially amidst rumors of him constructing a successor for the company.
- Analysts see an average price target of 199.60 US dollars for Tesla's stock, suggesting it could be a potential buy following the earnings report, but investors should be prepared for the corresponding volatility associated with Elon Musk's influence on the stock.
- The latest developments with Tesla include a spectacular comeback in the stock market before the quarterly earnings report, following a downward trend due to the Twitter-Elon Musk debacle and disappointing delivery numbers.
- Tesla's financial outlook is heavily influenced by the ever-changing circumstances with Elon Musk, such as his position as Twitter CEO and his vows to increase his involvement at the automaker since May to address operational challenges.
