Consumer Discretionary

By Rebecca Elliott Tesla warned of slower growth in 2024 without sharing a specific target, signaling more uncertainty ahead for the world’s most valuable automaker. The company reported fourth quarter net income more than doubled year-over-year to $7.9 billion, largely due to a one-time tax benefit. However, its income from operations was down 47% and its quarterly revenue came in shy of analysts’ expectations. “Our company is currently between two major growth waves,” Tesla said Wednesday, cautioning that growth “may be notably lower” than it was last year, when Tesla increased annual vehicle deliveries 38%. The company’s more subdued forecast is a sharp reversal from a couple of years ago, when demand seemed limitless and profitability was robust. Now, the electric-vehicle company is confronting softening demand, shrinking margins and intensifying competition from rival electric-vehicle makers. Tesla’s once industry-leading operating margin improved slightly quarter-over-quarter to 8.2% for the final three months […]

Tesla (TSLA) late Wednesday reported fourth-quarter results that were below Wall Street’s estimates as its margin nearly halved year over year while the electric vehicle manufacturer said volume growth this year will likely trail the rate achieved in 2023. Revenue increased 3% year over year to $25.17 billion but trailed the consensus on Capital IQ for $25.76 billion. Tesla reported adjusted per-share earnings of $0.71, down from $1.19 a year earlier and below the Street’s view of $0.74. The stock was down 3.4% in after-hours trade. The company said in a shareholder deck that sales benefited from higher deliveries and foreign exchange gains but were weighed down by lower average selling prices, which also hurt margins. Operating margin shrank by 784 basis points year over year to 8.2% amid costs associated with Cybertruck’s production ramp and other expenses,Tesla said. “Our team remains focused on growing our output, investing in our

CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows: We lower our 12-month target $25 to $275 on a ’25 P/E of 50x, justified by long-term growth expectations. We lower our adjusted EPS estimates by $0.85 to $3.90 for ’24 and by $0.75 to $5.50 for ’25. TSLA posted Q4 adjusted EPS of $0.71 vs. $1.19 (-40%), three cents shy of consensus. Revenue rose 3.5% to $25.17B ($590M below consensus) and gross margin contracted 620 bps to 17.6% (50 bps below consensus). We think Wednesday’s Reuters report that TSLA plans to launch its long-awaited mass market EV model (a compact crossover code named “Redwood”) with first production as early as mid-2025 could be the catalyst the stock needs after some profit taking so far in January after shares more than doubled in 2023. While the bottom-line

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Tesla (TSLA) investors will focus on margins and the 2024 demand outlook in reviewing Q4 results on Wednesday as the company decides to either continue cutting prices or maintain stable margins, Wedbush Securities said. “The conference call in 3Q left investors and bulls with many questions and few answers,” and “that uncertainty has been an overhang on the stock” since late October, Wedbush said Tuesday in a report. “The line in the sand around margins must be drawn tomorrow.” The market expects a 2024 production outlook of 20% unit growth with 2.1 million to 2.2 million units, Wedbush said. “The reality is EV demand globally is stalling and going through a glut of OEM supply now hitting the market, which in turn has put more pressure on the leader Tesla to cut prices to catalyze demand,” Wedbush said. Wedbush maintained an outperform rating for Tesla stock with a price target