Zhitong Finance APP has learned that Tesla (TSLA. US) will announce its fourth quarter 2021 results after hours in U.S. stocks on January 26, 2021. Tesla's Q4 revenue is generally expected to be $16.2 billion, up 50.8% year-over-year, and earnings per share of $2.26, up 182.5% year-over-year.
Tesla's revenue has exceeded expectations for eight consecutive quarters, and in 8 of the past nine quarters, non-GAAP earnings per share have exceeded expectations, which makes margins even more noteworthy. The market expects to see Tesla's profit margin improve by 50 basis points in the face of rampant inflation.
In addition, Tesla CEO Musk will return to the performance conference call and provide the latest product roadmap, and will also express personal views on the "supply chain nightmare".
Market focus
Delivery guidelines
In the face of challenges such as epidemic lockdown, supply chain bottlenecks, and lack of cores last year, Tesla's delivery results in the fourth quarter are still eye-catching.
Tesla's full-year deliveries in 2021 increased by 87% year-on-year to 936172 vehicles, of which the fourth quarter exceeded the 300,000-vehicle mark for the first time, breaking the delivery record. That has led investors to believe that Tesla has a better ability to deal with the global chip shortage than its competitors.
From Tesla's fourth-quarter deliveries, it can be expected that the company's fourth-quarter results will be strong. The question is what the forecast for production and delivery is, and what are the company's financial guidance for the first quarter and full year 2022. This could be the key to influencing the stock price. Last week, Netflix's stock price plunged 20% on the day because its performance guidance fell less than expected. If Tesla also disappoints investors, then in the current situation where the technology stock capital is fragile, it is not ruled out that the stock will continue to fall, and may even further collapse the entire technology stock sector.
The market currently believes that Tesla will be able to increase its delivery volume by 47% to 1.37 million units in 2022. More aggressive investors believe that the commissioning of two new plants in Berlin and Austin will bring deliveries close to 2 million units this year. Musk said on the second-quarter earnings call last year that the company aims to increase deliveries by about 50 percent or more a year.
But it's worth noting that this level of growth can only be achieved if Tesla puts its new factory into operation. The company's existing plant in California can only produce 600,000 cars a year and is in overproduction. If it relies on the old factory for production, Tesla has little room to increase production.
Let's talk about 2 new factories.
2 new plants
The commissioning of the two new plants will be the focus of investors' performance meetings.
It is reported that Musk will visit the Berlin Gigafactory next month. Previously, Tesla had expected the Berlin Gigafactory to start production by the end of 2021, but suffered some delays. Whether the plant is operational is key to increasing Tesla's production and providing supply channels in Europe.
Tesla was recently approved to produce its first 2,000 cars at its Berlin plant, but is still awaiting final approval from the plant. The plant may start with the production of the Model Y.
For the Austin plant, its production of the Model Y has also attracted attention because it uses a new structural battery pack and a new 4680 battery.
Wedbush analyst Dan Ives said on Jan. 10 that "Tesla may start production of model Y at the Austin gigafactory in the next 7 to 10 days, and the production of model Y is very important for the company to expand production of Model Y in the United States and globally." "Ives expects 2022 to be a year of huge Model Y production. At present, Tesla has not issued an announcement on the production status of the Austin factory.
However, sources said that Model Y deliveries at the Austin plant may begin at the end of the first quarter.
New product progress
The progress of new products remains in high esteem. At the results meeting, Tesla may confirm recent rumors that its electric pickup, cyberruck, may be further delayed from 2022 to 2023. Analysts believe that even if the Cyberruck mass production timeline is postponed again, Tesla fans will not be too surprised.
However, this will lag far behind electric vehicle startup Rivian (RIVN. US) launched the all-electric pickup R1-T in late 2021 and later than General Motors (GM. THE SCHEDULED DATE OF ELECTRIC TRUCKS OF US) AND FORD (F.US). Ford's F-150 Lightning is expected to launch this spring. The Silverado, the first universal electric pickup for a limited number of fleet operators, is expected to hit the road in the second quarter of 2023, with a consumer version coming in the fall of 2023.
According to the latest media statistics, Tesla has a backlog of more than 1.2 million Cyberrocks, worth more than $80 billion. But that means investors may have to prepare tesla for a whole year to come without launching a new model.
At the same time, it could also raise concerns among investors that other new models in production, such as the electric semi-trailer Semi and the Roadster, a sports car, have been forced to postpone production.
In addition, Musk has also revealed that Tesla's product line will cover the main forms of ground transportation. Some investors predict that one of Tesla's "future products" may be the launch of a highly intelligent all-electric vehicle priced at $25,000, and some investors predict that it may be Tesla energy products, including Tesla solar roof Solar Roof and Powerwall for homeowners. The truth remains to be revealed by Tesla at the performance meeting.
Digital assets
The digital assets held by Tesla are also a point of concern. Bitcoin is currently down more than 50% since its record high last November. As of press time, Bitcoin is trading at $35,993.6. Earlier last year, Tesla bought $1.5 billion in bitcoin for about $35,000.
The latest data from Bitcoin Treasuries, a website that tracks corporate holdings of cryptocurrency assets, shows that the value of Bitcoin held by Tesla shrank to $1.44 billion due to Tesla's selling of some of its bitcoins last year, coupled with the recent plunge. According to the Q3 2021 earnings report, Tesla's net digital asset holdings was $1.26 billion, bitcoin-related impairment losses were $51 million, and the net digital assets held in the previous quarter were $1.311 billion.
Analyst opinion
Market analysts have mixed views on Tesla's valuation, but are generally optimistic.
Morgan Stanley analyst Adam Jonas raised Tesla's price target from $1,200 to $1,300 while maintaining an "overweight" rating. The bank said Tesla's fourth-quarter deliveries were 20 percent higher than it expected. Jonas raised its full-year delivery forecast to 1.46 million units from 1.22 million units. He believes there are signs that Tesla is accelerating ahead of other EV counterparts.
Credit Suisse analyst Dan Levy raised Tesla's price target from $830 to $1,025 and maintained the stock's "neutral" rating. The analyst believes that favorable fundamental factors will continue to support Tesla's stock price, and based on the growth of Tesla's quarterly profit margin, the company's expectation of earnings per share in the fourth quarter will be higher than generally expected.
Goldman Sachs analyst Mark Delaney added Tesla to its list of preferred stocks for 2022, raising its price target from $1125 to $1200, maintaining a "buy" rating. The bank said strong fourth-quarter deliveries bode well for further growth in Tesla deliveries this year and next.
When the stock price bottoms
At the beginning of 2022, Tesla's stock price has been under pressure, and in the case of the recent hit on technology stocks, Tesla has suffered a large number of sell-offs, showing a downward trend. The stock has fallen 12 percent this year, more than 23 percent from a 52-week high. After falling below the 50-day and 100-day moving averages, some analysts once predicted that the stock would find support at the $995 level, and at the opening of the market on Monday, Tesla shares fell again, and as of press time, Tesla was quoted at $911. In addition, the RSI and the fact that the 50-day EMA remains below the 100-day EMA support the current view that the stock still has further downside.
Amid weaker stock prices, the stock's move after earnings is likely to have a significant impact on the technical side of the coming months.