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Tesla Q4 Earnings is ‘one of the most important’ for Elon Musk and Co.

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Tesla’s (NASDAQ: TSLA) fourth-quarter earnings call is being described as “one of the most important” for CEO Elon Musk and Co. by an analyst.

Wedbush’s Dan Ives describes tomorrow’s earnings as crucial, especially based on Musk’s potential comments regarding 2023 delivery targets, automotive gross margins, and overall outlook for the company moving forward.

Tesla’s 2023 Delivery Targets

After delivering a million units in a year for the first time in 2022, with 1.313 million cars delivered globally, Tesla is still going to be looking for year-over-year growth.

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“Over a multi-year horizon we expect to achieve 50% average annual growth in vehicle deliveries,” Tesla wrote in its Q3 2022 earnings shareholder deck. “The rate of growth will depend on our equipment capacity, factory uptime, operational efficiency, and the capacity and stability of the supply chain.”

This was a 40 percent increase from 2021 figures. However, it is not necessarily straightforward.

Tesla dealt with some production shutdowns last year in Shanghai, its biggest contributor to global manufacturing for the past two years. With ramp-ups continuing at Berlin, and products like the Cybertruck expected to launch this year in Texas, along with surges in demand thanks to price decreases, Tesla is sure to see growth this year. However, Ives seems interested in what Musk’s synopsis of the full year could be.

Automotive Gross Margins

After Tesla cut prices globally by as much as $13,000 in the United States and 13 percent in other markets, consumers felt the positives as the cars became more affordable. However, from an investor standpoint, it is much more complicated.

Tesla had the third-best operating margins globally, trailing only Ferrari and BMW. In Q3, the company posted 27.9 percent automotive gross margins, which was unchanged from Q2 but a decrease from the 32.9 percent the company posted in Q1.

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Price cuts from Tesla were seen as a way to trigger global demand, which many analysts felt the company was battling against as more competitors entered the EV sector. However, Tesla had raised prices many times over the past two years due to supply chain issues. It seems, while the automaker was making so much per unit, consumers were still looking for an affordable yet competitive EV option from the company.

Overall Outlook for 2023

Perhaps the biggest question on the minds of Tesla investors, especially the company’s “permabulls,” is whether Musk’s attention will remain fixated on Tesla or Twitter. While his acquisition of the social media platform has seemed to take up much of Musk’s time, he has recently solidified that Tesla is the priority.

This has not alleviated the drop the stock felt last year, as Tesla shares dropped over 60 percent in 2022. Slightly recovering so far in 2023 with a 32 percent increase in value so far this year, investors will likely want to know what Musk’s overall plans are for Tesla, and what his potential level of commitment will be.

Many are still questioning how the CEO is splitting his time between the two companies. However, with Tesla expecting to ramp up several projects this year, including a new Semi production facility and the aforementioned Cybertruck, Musk could have his hand in more of the Tesla pie through 2023 than he did in late 2022.

Ives said in a note to investors:

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“Tesla is Musk and Musk is Tesla. With all the worries about Musk’s attention on Twitter, selling Tesla stock, name a new Twitter CEO, and other noise created by this ongoing soap opera….this is a key moment of truth for Musk. Elon needs to give investors comfort around this tight wire balancing act and reiterate his goals for the year and lay out the strategic vision despite a near-term dark macro. Musk is not shy about his negative view of the economy, but how does that weave in with Tesla’s outlook? Also Musk giving some insight into the China situation, Twitter situation will be in the bright spotlight for the Street.”

Wedbush has a $175 price target and maintained its Outperform rating. The firm said it “ultimately believe[s] tomorrow’s call/guidance will be one of the most important moments in Tesla’s (and Musk’s) history.”

Disclosure: Joey Klender is a TSLA Shareholder.

I’d love to hear from you! If you have any comments, concerns, or questions, please email me at joey@teslarati.com. You can also reach me on Twitter @KlenderJoey, or if you have news tips, you can email us at tips@teslarati.com.

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Joey has been a journalist covering electric mobility at TESLARATI since August 2019. In his spare time, Joey is playing golf, watching MMA, or cheering on any of his favorite sports teams, including the Baltimore Ravens and Orioles, Miami Heat, Washington Capitals, and Penn State Nittany Lions. You can get in touch with joey at joey@teslarati.com. He is also on X @KlenderJoey. If you're looking for great Tesla accessories, check out shop.teslarati.com

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Elon Musk

Tesla analyst says Musk stock buy should send this signal to investors

“With Musk’s (Tesla stock) purchase, combined with the upward momentum for delivery expectations and robotaxi rollout, we are becoming more bullish.”

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(Credit: Tesla)

Tesla CEO Elon Musk purchased roughly $1 billion in Tesla shares on Friday, and analysts are now breaking down the move as the stock is headed upward.

One of them is William Blair analyst Jed Dorsheimer, who said in a new note to investors on Monday that Musk’s move should send a signal of confidence to stock buyers, especially considering the company’s numerous catalysts that currently exist.

Elon Musk just bought $1 billion in Tesla stock, his biggest purchase ever

Dorsheimer said in the note:

“With Musk’s (Tesla stock) purchase, combined with the upward momentum for delivery expectations and robotaxi rollout, we are becoming more bullish. This purchase is Musk’s first buy since 2020. To us, this sends a strong signal of confidence in the most important part of Tesla’s future business, robotaxi.”

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Musk putting an additional $1 billion back into the company in the form of more stock ownership is obviously a huge vote of confidence.

He knows more than anyone about the progress Tesla has made and is making on the Robotaxi platform, as well as the company’s ongoing efforts to solve vehicle autonomy. If he’s buying stock, it is more than likely a good sign.

Tesla has continued to expand its Robotaxi platform in a number of ways. The project has gotten bigger in terms of service area, vehicle fleet, and testing population. Tesla has also recently received a permit to test in Nevada, unlocking the potential to expand into a brand-new state for the company.

In the note, Dorsheimer also touched on Musk’s recent pay package, revealing that William Blair recently met with Tesla’s Board of Directors, who gave the firm some more color on the situation:

“We recently participated in a meeting with Tesla’s board of directors to discuss the details of Musk’s performance package. The board is confident of its position in the Delaware case and anticipates a verdict by end of year. It does not expect a similar situation to occur under new Texas jurisdiction. Musk has the board’s full support, and we expect he’ll get more than enough shareholder support for this to pass with flying colors.”

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Tesla stock is up over 6 percent so far today, trading at $421.50 at the time of publication.

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Elon Musk

Elon Musk just bought $1 billion in Tesla stock, his biggest purchase ever

Prior to this latest move, Musk’s most recent purchase was for about 200,000 shares worth $10 million in 2020.

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Gage Skidmore from Surprise, AZ, United States of America, CC BY-SA 2.0 , via Wikimedia Commons


Tesla (NASDAQ:TSLA) shares rose on Monday after CEO Elon Musk disclosed a rare insider purchase of company stock worth about $1 billion. 

A filing with the U.S. Securities and Exchange Commission (SEC) revealed that Musk acquired 2.57 million shares last Friday at various prices. The move represents Musk’s largest TSLA purchase ever by value, as per Verity data.

Elon Musk’s TSLA purchase

The disclosure sent Tesla shares up more than 8% in premarket trading Monday, as investors read the purchase as a notable vote of confidence, as stated in a CNBC report. Tesla stock had closed slightly lower Friday but remains more than 25% higher over the past three months. It should be noted that prior to this latest move, Musk’s most recent purchase was for about 200,000 shares worth $10 million in 2020.

Market watchers say the purchase could help shore up investor sentiment amid a volatile year for TSLA stock. Shares have faced pressure from a variety of factors, from year-over-year sales challenges due to the new Model Y changeover, political controversies tied to Musk, and reduced U.S. incentives for EVs under the Trump administration. Nevertheless, analysts such as Wedbush’s Dan Ives stated that Musk’s purchase was a “huge sign of confidence for Tesla bulls and shows Musk is doubling down on his Tesla A.I. bet.”

Tesla and Elon Musk

Musk already owns about 13% of Tesla, and his latest purchase comes as the company prepares for a key shareholder vote in November. Investors will decide whether to approve a compensation package for Musk that could ultimately be worth as much as $975 billion if ambitious market value milestones are achieved. The package has a long-term target of pushing Tesla’s market capitalization to $8.5 trillion, compared with about $1.3 trillion at Friday’s close.

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Wall Street’s current consensus price target still implies a roughly 20% decline from current levels, though some Tesla bulls remain optimistic that the company could shift its focus toward autonomy, AI, and robotics. Musk has also asked shareholders to approve an investment into his latest venture, xAI.

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Investor's Corner

Tesla bear turns bullish for two reasons as stock continues boost

“I think from a trading perspective, it looks very interesting,” Nathan said, citing numerous signs of strength, such as holding its 200-day moving average and holding against its resistance level.

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Credit: Tesla Manufacturing

A Tesla bear is changing his tune, turning bullish for two reasons as the company’s stock has continued to get a boost over the past month.

Dan Nathan, a notorious skeptic of Tesla shares, said he is changing his tune, at least in the short term, on the company’s stock because of “technicals and sentiment,” believing the company is on track for a strong Q3, but also an investment story that will slowly veer away from its automotive business.

“I think from a trading perspective, it looks very interesting,” Nathan said, citing numerous signs of strength, such as holding its 200-day moving average and holding against its resistance level.

He also said he believes a rally for the stock could continue as it heads into the end of the quarter, especially as the $7,500 electric vehicle tax credit is coming to an end at the end of the month.

With that being said, he believes the consensus for Q3 deliveries is “probably low,” as he believes Wall Street is likely underestimating what Tesla will bring to the table on October 1 or 2 when it reports numbers for the quarter.

Tesla shares are already up over five percent today, with gains exceeding nine percent over the past five trading days, and more than fourteen percent in the past month.

While some analysts are looking at the performance of other Mag 7 stocks, movement on rates from the Federal Reserve, and other broader market factors as reasoning for Tesla’s strong performance, it appears some movement could be related to the company’s recent developments instead.

Over the past week, Tesla has made some strides in its Robotaxi program, including a new license to test the platform in the State of Nevada, which we reported on.

Tesla lands regulatory green light for Robotaxi testing in new state

Additionally, the company is riding the tails of the end of the EV tax credit, as inventory, both new and used, is running extremely low, generally speaking. Many markets do not have any vehicles to purchase as of right now, making delivery by September 30 extremely difficult.

However, there has been some adjustments to the guidelines by the IRS, which can be read here:

Tesla set to win big after IRS adjusts EV tax credit rules

Tesla is trading at around $389 at 10:56 a.m. on the East Coast.

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