TSLA Stock: Tesla Misses Delivery Estimates in Q3 of 2022
03 October 2022 - 8:24PM
Finscreener.org
Over the weekend,
Tesla (NASDAQ: TSLA)
reported its vehicle production and delivery numbers for Q3 of
2022. It produced 365,000 vehicles and delivered 343,000 vehicles
in the quarter that ended in September.
Vehicle deliveries are often the
closest approximation of sales reported by Tesla. Analysts tracking
the largest electric vehicle (EV) producer expected the company to
deliver 364,660 vehicles in Q3.
Tesla also disclosed it produced
19,935 units of higher-priced models such as Model S and X
vehicles, while Model 3 and Y accounted for the rest of its
vehicles in Q3. In the year-ago quarter, Tesla produced 258,580
vehicles, while vehicle deliveries stood at 254,695
units.
Tesla explained that soaring
commodity prices and scalability issues at its new factories in
Texas and Germany resulted in lower-than-expected production
numbers in the quarter. Further, it also had to
temporarily suspend
production at the
Shanghai factory in July for plant upgrades.
There is a good chance for Tesla
stock to move lower in early market trading today due to its
unimpressive production and delivery numbers in Q3. TSLAU+02019s
stock price is currently down over 35% from all-time highs, valuing
it at a market cap of $831 billion.
Will TSLA stock price recover in Q4 of
2022?
Despite a challenging
macroeconomic environment, Tesla continues to grow its revenue and
profits at an enviable pace. In Q2, its sales were up 42% year over
year to $16.9 billion. While commodity prices moved higher, Tesla’s
pricing power ensured its operating margins improved by 358 basis
points to 14.6% as well. In fact, its adjusted net income rose by
57% to $2.27 per share in Q2.
The global shift towards
clean energy solutions
should act as a massive tailwind for
Tesla and its peers. According to research reports, the global
EV
market is expected to expand by 29% annually through 2030,
allowing Tesla to keep widening its revenue and earnings in the
upcoming decade. Annual EV sales might surpass 31.1 million units
in 2030, up from just 2.5 million units in 2020.
Yes, Tesla will have to wrestle
with rising competition from legacy automobile manufacturers such
as Ford (NYSE:
F) and Volkswagen as well
as from new entrants like Rivian
(NASDAQ:
RIVN) and
Lucid Motors (NASDAQ:
LCID). But its first
mover advantage and market-leading share should allow TSLA stock to
deliver outsized gains to investors.
Tesla’s market share in the EV
market across the United States, Europe, and China has slumped to
15.6% in Q2 of 2022, from almost 25% in Q2 of 2020. But in the last
two years, it has almost tripled vehicle deliveries. For example,
its vehicle deliveries surged from 91,000 units to 255,000 in this
period.
What next for Tesla stock price and
investors?
Tesla continues to aggressively
expand its capacity and take advantage of multiple secular
tailwinds surrounding the EV space. It should continue to benefit
from economies of scale and is forecast to increase adjusted
earnings at an annual rate of 55% in the next five
years.
Comparatively, analysts expect
Tesla sales to rise from $53.8 billion in 2021 to $121.4 billion in
2023.
So, TSLA stock is trading at 45x
2023 earnings and 6.9x forward earnings, which might seem
expensive. But growth stocks command a premium multiple, and Tesla
is a quality growth stock. Despite its steep valuation, analysts
trading TSLA stock expect shares to rise by almost 20% in the next
year.
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