Tesla Used Cars the Last Domino to Fall in Stock and Branding Rout

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  • #50157
    TradersCom
    Keymaster

    Tesla was the green technology, electric vehicle and ESG golden child run by the world’s living genius, then it all come back to earth swiftly. There
    [See the full post at: Tesla Used Cars the Last Domino to Fall in Stock and Branding Rout]

    #50158
    TradersCom
    Keymaster

    Entering today Mega Caps were crushed in December:
    Tesla down 42%
    Apple down ~15%
    Vanguard Mega Cap Growth ETF down 11.3%

    Today’s Bounce:
    $TSLA 121.82 +9.11, +8.1%
    $AAPL 129.61 +3.57, +2.8%
    $MGK 172.47 +4.26 +2.53%

    #50165
    MoneyNeverSleeps
    Participant

    Wedbush’s Ives outlines ‘Top 10’ priorities for CEO Musk to turn around Tesla stock, which is headed for its worst month, quarter and year on record

    TSLA +8.08% today

    Priority No. 1? “Name a CEO of Twitter by the end of January”

    Earlier this month, Musk tweeted out a poll asking if he should “step down as head of Twitter.” A majority of respondents voted “Yes.”

    Priority No. 2, Ives said, was: “Stop selling stock and no more boy that cried wolf or Pinocchio situation.” Ives wants Musk to formally adopt a plan for when he will sell shares, known as a 10b5-1, after selling nearly $40 billion in stock since November 2021.

    Priority No. 3 involves cutting back on Musk’s typically aggressive growth forecasts for Tesla. “Lay out conservative 2023 delivery and targets given the darker macro,” he wrote. “The 50% growth target is not happening in our opinion, with 35%+ delivery growth a more hittable and realistic goal for 2023.”

    No. 4 on that list called for greater attention on Tesla, rather than Twitter,

    No. 5 called for announcing Cybertruck deliveries will begin by the end of next year, amid concerns about competition and production.

    No. 6 called for changes to Tesla’s board to add more people with experience in tech and electric vehicles.

    No. 7: A big share buyback.

    No. 8: More financial metrics and “transparency” around margins.

    The last two items on that list also revolved around Twitter.

    “The more political on Twitter that Musk becomes is a bad thing for selling EV cars to the masses,” read No. 9 on the list.

    Lastly: “Lay out the strategic plan for Twitter,” the note said.

    “Right now very simply the fear is Twitter is bleeding money with advertisers fleeing (for now) which means more losses and therefore more Musk TSLA stock sales. Once a new CEO is in place lay out the 3-year strategy of Twitter and what this can become, Super App, ‘X,’ WeChat 2.0, etc.”

    Shares of Tesla have fallen 65% year to date. By comparison, the S&P 500 index SPX, +1.75% is down 19% over that time.

    While some analysts have praised Tesla’s margin profile, Wall Street has been concerned about growth in China and competition from other EV makers.

    Shares of the company were up 8% on Thursday, after Morgan Stanley said the drop represented an “attractive entry point.“

    #50627
    TradersCom
    Keymaster

    Tesla Q4 Deliveries Show Another Big Miss

    Q4 deliveries of about 405K short of the analyst consensus by nearly 15K, falling below that bar despite “aggressive price discounting” into year-end. Additionally, inventory growth of 34K units to 78K a concern.

    Production significantly outpaced deliveries for the second quarter in a row. Management attributed this to a “continued transition towards a more even regional mix of vehicle builds,” leading to more in-transit vehicles at the end of the period.

    Musk said back in early 2019 that Tesla would soon fix the delivery surge that results in a lot of deliveries late in the quarter. That still really hasn’t happened over the last three years, despite plenty of opportunities to reorganize the timing of vehicle builds in the production facilities.

    The company produced more than 56,500 vehicles more than it delivered in the back half of 2022. That will only help to fuel the concerns about sluggish demand.

    This was the second straight quarter where Tesla’s reported delivery figure fell quite a bit short of estimates. In late December, Tesla investor relations sent out its usual company compiled estimates figure, which was just a little below 418,000 vehicles. Despite that number being a bit below where the street was just a few weeks earlier, the actual figure fell almost 13,000 units short.

    There were numerous promotions throughout Q4 to drive demand.

    In the US, Tesla pushed a late in quarter $3,750 credit, which was eventually doubled, along with the giveaway of 10,000 free supercharging miles.

    In China, multiple promotions were detailed throughout the quarter, and these even came after prices were cut early in the quarter. Some other promotions were even enacted in lower volume sales countries to help, but apparently, they were not enough. Tesla has started 2023 by offering another set of incentives in China to offset the elimination of that country’s EV subsidy.

    #50628
    TradersCom
    Keymaster

    Bernstein analyst Toni Sacconaghi noted Tesla (TSLA) is “facing a significant demand problem” into 2023.

    “We expect demand challenges to persist into 2023, particularly since no Tesla models appear to qualify for any IRA rebates except the 7-seat Model Y,” he explained. “We believe Tesla will either need to reduce its growth targets (and run factories below capacity) or sustain and potentially increase price cuts globally, pressuring margins.”

    Sacconaghi said he was “torn” on the stock given its stark slide into the close of 2022, he maintained an “Underperform” rating on the stock.

    #50629
    TradersCom
    Keymaster

    JP Morgan advising an Underweight rating on the stock. The bank’s analysts trimmed their price target to $125 from a prior $150 on the back of the Q4 delivery figures.

    “Although both technology and execution risk seem substantially less than was once feared, expansion into higher volume segments with lower price points seems fraught with greater risk relative to demand, execution, and competition,” the team explained. “Meanwhile, valuation appears to be pricing in upside related to expansion into mass-market segments well beyond our volume forecasts for the Model 3.”

    #50630
    TradersCom
    Keymaster

    Goldman Sachs advised that Tesla (TSLA) is still a Buy despite the disappointing Q4 report.

    Goldman largely agreed on these points, noting that the “incremental negative” of the Q4 delivery report does not dampen their long-term perspective on the stock. While EPS estimates were trimmed due to expected margin compression amid price cuts, Tesla (TSLA) remains “well positioned for long-term growth,” according to equity analyst Mark Delaney.

    #50631
    TradersCom
    Keymaster

    Deutsche Bank advised that Tesla (TSLA) is still a Buy despite the disappointing Q4 report.

    “Beyond the quarter, we expect challenging headlines around demand softening and associated price cuts to continue; recent reports already suggest Tesla may take an extended shutdown in Shanghai later this month around Chinese New Year,” Deutsche Bank’s analysts acknowledged. “Further price actions will likely be implemented to align demand with supply, but we continue to believe the company remains best positioned to weather the current macroeconomic conditions, leveraging price to support volume growth, while using various cost levers to protect margins.”

    #50632
    TradersCom
    Keymaster

    TSLA 119.33 -3.85 (-3.13%) Pre-Market

    #50807
    Truman
    Participant

    EV stocks down on new ‘incentives

    $TSLA $109.77 3.41% -3.87
    $RIVN $16.86 4.80% -0.85
    $NKLA $2.22 3.48% -0.080
    $WKHS $1.62 4.44% -0.075
    $NIO $10.83 1.88% +0.20
    $FSR $7.15 1.38% -0.100
    $HYLN $2.25 3.65% -0.085
    $RIDE$1.06 8.26% -0.095
    $LCID $6.32 2.55% -0.17

    • This reply was modified 4 weeks ago by Truman.
    #50809
    MoneyNeverSleeps
    Participant

    Worse Biden said he was all about efficiency, climate etc and he takes off the most efficient gives it to the least. Yet all I hear is crickets – why I can’t activists screaming? All about unions and his friends – am I missing anything?

    #50831
    MoneyNeverSleeps
    Participant

    Tesla has further cut the prices on its Model 3 and Model Y EVs in China
    Model 3 starting price to 229,900 yuan
    Model Y 259,900 yuan

    Headline only so far

    #51608
    TradersCom
    Keymaster

    Elon Musk trial begins in San Francisco where he is sued by Tesla shareholders over infamous 420 Tweet
    on Aug 7, 2018

    “Am considering taking Tesla private at $420. Funding secured.”
    He has already paid $20m to the SEC, $TSLA paid another $20m

    In 2018, he tweeted that he had “funding secured” to take the carmaker private.

    However the funding was not secured – and Tesla was not taken private.

    Shareholders argued that they lost billions of dollars due to the tweet after the share price plummeted.

    The Tesla CEO, however, argued that he believed he had secured funding from Saudi Arabia’s Investment Fund, and did not commit securities fraud.

    If a San Francisco jury rules in the shareholder’s favour, Mr Musk may be ordered to pay billions of dollars in damages.

    He has already paid $20m to the Securities Exchange Commission (SEC) for the 7 August 2018 tweet, while Tesla had to pay another $20m.

    The SEC also removed Mr Musk as chairman of Tesla as a result of the tweet.

    Legal experts said they believe it will be a difficult case for Mr Musk to win, and that the fine he paid to the SEC will be used against him in the case. However jury trials in cases of fraud are notoriously difficult to predict.

    Mr Musk had wanted the trial to be moved to Texas, arguing a fair jury would not be possible to find in San Francisco.

    He argued that mass sackings at Twitter, a company he bought last year, affected many employees in San Francisco – and that he is not popular in the city.

    Mr Musk’s team had argued that a significant majority of potential jurors said they viewed the billionaire negatively.

    However, the judge said the trial would go ahead in California.

    The trial may see Mr Musk give evidence under oath. The witness list also includes Oracle’s CEO Larry Ellison and media tycoon James Murdoch.

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