Tesla’s delivery beat ‘does not change the big picture’ in the eyes of skeptical Wall Street analysts (TSLA) – Finance

  • tesla in the third quarter, 8% more than Wall Street analysts had expected.
  • However, stocks fell after the announcement and continued to decline on Wednesday, when analysts began looking at Tesla's third-quarter earnings at the end of this month.
  • It is expected that the company will report on its results on October 31 – when all eyes will be on the bottom line.
  • Follow Tesla's stock price in real time here.

Tesla third quarter total shipments easily exceeded Wall Street expectations this week, but the upcoming quarterly earnings report and the presentation of Elon Musk CEO as chairman of the board analysts turn their attention to the balance of the manufacturer of electric vehicles.

For the quarter ended Sept. 30, Tesla delivered 83,500 cars – beating analysts' expectations and their own forecasts. Production of model 3, slightly lagging behind the delivery number at 53,239 for the quarter, is about 4,018 a week for 13 weeks. In August, Musk said He expected that Tesla will release 6000 models 3 per week by the end of the month – company bid should allow him to get "steady quarterly profits, without strong force majeure circumstances or an economic downturn, while continuing to grow at a rapid pace."

Wall Street analysts will not be sure of profitability until they see it in the regulatory documentation expected on October 31.

"It is difficult to positive, we are not convinced that [Tuesday’s delivery report] enough for Tesla to reach its GAAP profitability target for the third quarter, ”said George Galliers, an Evercore ISI analyst who has a target price of $ 299 for stocks, says a note to customers on Wednesday.” As a result, we see little change in the big picture. "

Gullers estimated that beating the delivery – several thousand cars ahead of the expected 80,900 Street – could add 488 million dollars in revenue and 105 million dollars in profits to the third quarter results of Tesla at the end of this month, the amount he said is probably not sufficient for the company to become profitable .

Tesla second quarter earnings, released on August 1, showed a negative free cash flow of $ 739 million, which resulted in a loss of about $ 3 per share. A burn of this magnitude most analysts factoring capital injection to their models until the end of the year.

“We doubt that all hands on package deck for production and supply will lead to profitability in Q3, but we believe that switching to AWD production in Q4 may allow the company to achieve profitability on an adjusted basis in Q4, although we do not forecast GAAP profitability, "said Jeff Osborne, an analyst at Cowen, after the announcement on Tuesday. He has a" underweight "rating and a price for $ 200 per share.

“We still see the need to raise 4Q $ 2 billion,” he added.

The Wall Street consensus for Tesla shares fell to $ 291, surpassing $ 300 in recent weeks amid the consequences of a lawsuit against the Securities and Exchange Commission against Musk and its subsequent settlement. Shares held in this range, as investors are most likely waiting for who will lead the board of directors in the absence of Musk – key part in settling it is $ 20 million with the SEC,

The New York Times reported on Tuesday that James Murdoch was seen by some board members as a potential replacement., although external groups, such as the Glass Lewis proxy monitor, have expressed concern about the lack of experience with Murdoch,

Tesla shares this year fell by 5.4%.

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