Investor's Corner
Tesla’s Q2 2019 earnings: A look back at TSLA’s journey from Q2 2018 to the present
Tesla’s (NASDAQ:TSLA) second-quarter earnings report on Wednesday is poised to be a pivotal point for the electric car maker. While the importance of Q2 2019’s earnings cannot be emphasized enough, it is pertinent to note that just a year ago in Q2 2018, things were a lot different for Tesla. Things were, for lack of a batter term, a make or break for the company.
Tesla was at a much different place in the second quarter of 2018. Prior to Q2 2018, Tesla had failed to meet every Model 3 production forecast that it has announced. Q2 2018 already had an adjusted production target of producing 5,000 Model 3 per week, but the task had proven to be more difficult than expected. Even Q1 2018’s conservative goal, producing 2,500 Model 3 per week, was not met by the end of March 2018.
Tesla dug deep in the second quarter, breaking convention and building GA4 in the Fremont factory’s grounds. The rapid buildout only took a few weeks, and it involved CEO Elon Musk doing manual work with other Tesla employees in an attempt to set up the tent-based production line. Apart from this, Tesla also decided to fly in six airplanes’ worth of robots from Europe as part of an initiative to raise Model 3 production numbers. These measures ultimately allowed Tesla to produce 5,000 units of the electric sedan by the end of the second quarter.
The next two quarters following Q2 2018 will see Tesla’s challenges transition from what Elon Musk described as “production hell” to “delivery logistics hell.” Together with the launch of the Model 3 Performance and the Dual Motor AWD variant, Tesla’s efforts ultimately resulted in the company reaching profitability in both the third and fourth quarter. Vehicle delivery numbers also reached record levels, hitting 90,000 in Q4 2019.
Tesla did have its own set of challenges in this period, and a notable part of it was centered on CEO Elon Musk. The CEO ended up in several Twitter controversies over the past 12 months, from his rows with journalists that seemingly held notable anti-Tesla biases, to his short-lived attempt at taking Tesla private at $420 per share, to his troubles with the Security and Exchange Commission, which resulted in his departure from Tesla’s Chairman position.
Amidst all these challenges, Tesla has expanded its presence in the electric vehicle market. The company has revealed the Model Y, and Tesla has also taken the wraps off its custom Hardware 3 computer, which will be a crucial component of its future Full Self-Driving strategy. The company has also started rolling out improvements to the Model S and X, which are expected to herald even more updates to the flagship vehicles.
In the weeks leading up to Tesla’s release of its Q2 2019 vehicle production and delivery figures, TSLA stock was battered as analyst after analyst from Wall Street expressed reservations about the allegedly declining demand for the company’s vehicles. Yet, following the release of the company’s record-setting numbers, sentiments among TSLA investors have shifted for the better. Tesla has so far been on a path towards recovery in July, recovering around 14% to date following another 21% in June.
Tesla set records in Q2 2019 by producing a total of 87,048 vehicles and delivering approximately 95,200, both in the United States and in other territories such as Europe and China. This quarter’s feat was a blow to the pervading bear thesis insisting that demand for the company’s vehicles is declining. With such strong results, Wall Street is currently expecting Tesla to report an adjusted quarterly loss of $0.39 per share.
As of writing, Tesla stock is trading at +0.60% at $257.21 per share.
Disclosure: I have no ownership in shares of TSLA and have no plans to initiate any positions within 72 hours.
Investor's Corner
Tesla analyst maintains $500 PT, says FSD drives better than humans now
The team also met with Tesla leaders for more than an hour to discuss autonomy, chip development, and upcoming deployment plans.
Tesla (NASDAQ:TSLA) received fresh support from Piper Sandler this week after analysts toured the Fremont Factory and tested the company’s latest Full Self-Driving software. The firm reaffirmed its $500 price target, stating that FSD V14 delivered a notably smooth robotaxi demonstration and may already perform at levels comparable to, if not better than, average human drivers.
The team also met with Tesla leaders for more than an hour to discuss autonomy, chip development, and upcoming deployment plans.
Analysts highlight autonomy progress
During more than 75 minutes of focused discussions, analysts reportedly focused on FSD v14’s updates. Piper Sandler’s team pointed to meaningful strides in perception, object handling, and overall ride smoothness during the robotaxi demo.
The visit also included discussions on updates to Tesla’s in-house chip initiatives, its Optimus program, and the growth of the company’s battery storage business. Analysts noted that Tesla continues refining cost structures and capital expenditure expectations, which are key elements in future margin recovery, as noted in a Yahoo Finance report.
Analyst Alexander Potter noted that “we think FSD is a truly impressive product that is (probably) already better at driving than the average American.” This conclusion was strengthened by what he described as a “flawless robotaxi ride to the hotel.”
Street targets diverge on TSLA
While Piper Sandler stands by its $500 target, it is not the highest estimate on the Street. Wedbush, for one, has a $600 per share price target for TSLA stock.
Other institutions have also weighed in on TSLA stock as of late. HSBC reiterated a Reduce rating with a $131 target, citing a gap between earnings fundamentals and the company’s market value. By contrast, TD Cowen maintained a Buy rating and a $509 target, pointing to strong autonomous driving demonstrations in Austin and the pace of software-driven improvements.
Stifel analysts also lifted their price target for Tesla to $508 per share over the company’s ongoing robotaxi and FSD programs.
Investor's Corner
Tesla wins $508 price target from Stifel as Robotaxi rollout gains speed
The firm cited meaningful progress in Tesla’s robotaxi roadmap, ongoing Full Self-Driving enhancements, and the company’s long-term growth initiatives.
Tesla received another round of bullish analyst updates this week, led by Stifel, raising its price target to $508 from $483 while reaffirming a “Buy” rating. The firm cited meaningful progress in Tesla’s robotaxi roadmap, ongoing Full Self-Driving enhancements, and the company’s long-term growth initiatives.
Robotaxi rollout, FSD updates, and new affordable cars
Stifel expects Tesla’s robotaxi fleet to expand into 8–10 major metropolitan areas by the end of 2025, including Austin, where early deployments without safety drivers are targeted before year-end. Additional markets under evaluation include Nevada, Florida, and Arizona, as noted in an Investing.com report. The firm also highlighted strong early performance for FSD Version 14, with upcoming releases adding new “reasoning capabilities” designed to improve complex decision-making using full 360-degree vision.
Tesla has also taken steps to offset the loss of U.S. EV tax credits by launching the Model Y Standard and Model 3 Standard at $39,990 and $36,990, Stifel noted. Both vehicles deliver more than 300 miles of range and are positioned to sustain demand despite shifting incentives. Stifel raised its EBITDA forecasts to $14.9 billion for 2025 and $19.5 billion for 2026, assigning partial valuation weightings to Tesla’s FSD, robotaxi, and Optimus initiatives.
TD Cowen also places an optimistic price target
TD Cowen reiterated its Buy rating with a $509 price target after a research tour of Giga Texas, citing production scale and operational execution as key strengths. The firm posted its optimistic price target following a recent Mobility Bus tour in Austin. The tour included a visit to Giga Texas, which offered fresh insights into the company’s operations and prospects.
Additional analyst movements include Truist Securities maintaining its Hold rating following shareholder approval of Elon Musk’s compensation plan, viewing the vote as reducing leadership uncertainty.
@teslarati Tesla Full Self-Driving yields for pedestrians while human drivers do not…the future is here! #tesla #teslafsd #fullselfdriving ♬ 2 Little 2 Late – Levi & Mario
Investor's Corner
Tesla receives major institutional boost with Nomura’s rising stake
The move makes Tesla Nomura’s 10th-largest holding at about 1% of its entire portfolio.
Tesla (NASDAQ:TSLA) has gained fresh institutional support, with Nomura Asset Management expanding its position in the automaker.
Nomura boosted its Tesla holdings by 4.2%, adding 47,674 shares and bringing its total position to more than 1.17 million shares valued at roughly $373.6 million. The move makes Tesla Nomura’s 10th-largest holding at about 1% of its entire portfolio.
Institutional investors and TSLA
Nomura’s filing was released alongside several other fund updates. Brighton Jones LLC boosted its holdings by 11.8%, as noted in a MarketBeat report, and Revolve Wealth Partners lifted its TSLA position by 21.2%. Bison Wealth increased its Tesla stake by 52.2%, AMG National Trust Bank increased its position in shares of Tesla by 11.8%, and FAS Wealth Partners increased its TSLA holdings by 22.1%. About 66% of all outstanding Tesla shares are now owned by institutional investors.
The buying comes shortly after Tesla reported better-than-expected quarterly earnings, posting $0.50 per share compared with the $0.48 consensus. Revenue reached $28.10 billion, topping Wall Street’s $24.98 billion estimate. Despite the earnings beat, Tesla continues to trade at a steep premium relative to peers, with a market cap hovering around $1.34 trillion and a price-to-earnings ratio near 270.
Recent insider sales
Some Tesla insiders have sold stock as of late. CFO Vaibhav Taneja sold 2,606 shares in early September for just over $918,000, reducing his personal stake by about 21%. Director James R. Murdoch executed a far larger sale, offloading 120,000 shares for roughly $42 million and trimming his holdings by nearly 15%. Over the past three months, Tesla insiders have collectively sold 202,606 shares valued at approximately $75.6 million, as per SEC disclosures.
Tesla is currently entering its next phase of growth, and if it is successful, it could very well become the world’s most valuable company as a result. The company has several high-profile projects expected to be rolled out in the coming years, including Optimus, the humanoid robot, and the Cybercab, an autonomous two-seater with the potential to change the face of roads across the globe.
@teslarati Tesla Full Self-Driving yields for pedestrians while human drivers do not…the future is here! #tesla #teslafsd #fullselfdriving ♬ 2 Little 2 Late – Levi & Mario
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Tesla analyst maintains $500 PT, says FSD drives better than humans now
