Tesla earnings live updates: Company beats profit estimates for the 3rd quarter, stock jumps 7%
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- Oct 23, 2024
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October 23, 2024 at 6:48 PM
Tesla reported its third-quarter earnings on October 23, with EPS coming in above Wall Street's expectations.
VCG Adjusted EPS: $0.72 vs estimate of $0.60
Earnings per share: $0.62 vs estimate of $0.51
Revenue: $25.18 billion vs estimate of $25.43 billion
Gross margin: 19.8% vs estimate of 16.8%
Operating income: $2.72 billion vs estimate of $1.96 billion
Free cash flow: $2.74 billion vs estimate of $1.61 billion
Capital expenditure: $3.51 billion vs estimate of $2.56 billion
Tesla stock falls before earnings
Shares of Tesla traded down about 2% heading into the company's earnings report, trading at around $214.32 at 3:42 p.m.
The losses were about double the S&P 500's loss of 1% and slightly more than the Nasdaq 100's 1.65% decline.
Wedbush analyst Dan Ives sticks with bullish view on Tesla despite recent volatility
Tesla reported its third-quarter earnings on October 23, with EPS coming in above Wall Street's expectations.
VCG
The Wedbush analyst Dan Ives is staying bullish on Tesla stock, arguing that the company should show a return to growth in its third-quarter earnings call and forward guidance.
"We expect generally in-line 3Q headline numbers with some slight upside likely on the margins front showing a bottoming on this key metric," Ives said in a recent note.
Ives argued that Tesla should be able to deliver 1.8 million vehicles in 2024 and that the figure should rise to more than 2 million vehicles in 2025.
But perhaps more important than vehicle deliveries for Wall Street is Tesla's profit margins.
"Margins will be a key focus on the conference call," Ives said.
He added that investors would want to see this metric in the high teens for the third and fourth quarters and heading toward 20% in 2025. That should soothe fears about further price cuts and convince investors that better days are ahead, Ives said.
Wedbush rates Tesla at "outperform" with a $300 price target.
Wells Fargo said Tesla is likely to lean into pricing incentives to boost vehicle deliveries
After Tesla reported disappointing third-quarter deliveries this month, Wells Fargo said it expects the company to make up for the shortfall in sales by offering "aggressive finance promos globally."
"We est. the Q3 promotions are equivalent to ~8% lower effective px cut," analyst Colin Langan said in a note last week, adding that he expects the company to miss Wall Street's third-quarter earnings estimates.
Langan predicted that Tesla's automotive gross margin, excluding credits, would be 13.6% in the third quarter, down from 14.6% in the previous quarter.
Wells Fargo rates Tesla at "underweight" with a $120 price target.
Barclays says Wall Street wants to see Tesla get back to fundamentals: selling cars
San Francisco Chronicle/Hearst Newspapers via Getty Images
"With Tesla's Robotaxi Day passed, we believe the focus for Tesla at least for now shifts back to fundamentals," the Barclays analyst Dan Levy said in a note last week.
Levy expects Tesla to beat earnings estimates, predicting earnings per share of $0.68 versus the consensus estimate of about $0.60.
"After a run of sharply negative revisions to earnings estimates, Tesla estimates have largely stabilized," Levy said. "Volumes are expected to be flat y/y, margins have troughed and are set to improve, reg credit revenue can be a solid boost as other OEMs rely on Tesla to achieve compliance, Tesla Energy is generating solid growth, and opex may trend lower for now as Tesla realizes the cost saves of headcount reductions."
Those points, along with the fact that Tesla stock sold off after its robotaxi event, give Levy confidence that the company's third-quarter earnings will be a catalyst for the stock.
Levy said that, aside from discussing the earnings results and guidance on its conference call, any commentary about plans for a lower-cost vehicle could move the stock.
"We also wouldn't dismiss the notion that Tesla could forgo a 'Model 2.5,' instead focusing its resources on rolling out the AV strategy," Levy said, referring to the firm's autonomous-vehicle ambitions. He added that investors would treat such a development as a negative for the stock.
Barclays rates Tesla at "equal weight" with a $220 price target.
Bloomberg Intelligence says Tesla's luxury brand identity is at risk amid steep price cuts
Tesla's aggressive price cuts of 20% over the past year, combined with a plunge in trade-in values for Tesla vehicles, suggest there's "more pain to come," said Joel Levington, a director of credit research at Bloomberg Intelligence.
Levington argued in a note on Tuesday that Tesla's price declines were putting its luxury brand identity at risk.
Levington added that with Tesla facing more competition, it needs to release a lower-cost vehicle.
"Tesla is poised to give up share as rivals from Acura to Volvo create a tsunami of new EV products that will flood the markets, making the lower-cost Model 2 and updates of its data product line critical," Levington said.
Here are the numbers Wall Street is expecting from Tesla's earnings
Tesla
According to data from Bloomberg, here's what Wall Street is expecting from Tesla's third-quarter earnings report.
Third Quarter
Used Tesla Model S Performance
Jul 17, 2019
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