We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Tesla (TSLA - Free Report) shares undoubtedly jump to the forefront of many minds when considering exciting investments. After all, it’s easy to understand why, as the company has entirely changed the way we see the automotive landscape.
And, of course, TSLA shares have long been outperformers, up nearly 5000% just over the last decade and crushing the S&P 500.
However, Tesla shares have been punished over the last month, as shown in the chart below.
Image Source: Zacks Investment Research
It raises a valid question: what’s been going on?
Let’s take a closer look.
Near-Term Headaches
First of all, Tesla’s total EV deliveries are always closely monitored.
It's an absolutely vital metric because, of course, it shows how many EVs Tesla has been able to place in the hands of customers.
And on Monday, Tesla reported Q4 deliveries of roughly 405,000. On the surface level, this would be fantastic, representing another quarter of record deliveries for the EV titan.
However, the reported figure fell short of estimates, sending shares downward in Tuesday’s session. Our consensus estimate stood at 407,855.
The worse-than-expected EV deliveries number came in a quarter that was already negatively impacted by COVID-19 disruptions, causing its Shanghai plant to reduce production.
All in all, reduced production at its Shanghai location, a miss on deliveries, and concerns of weakening demand have all been a thorn in the side of Tesla over the recent months.
How else does everything look?
Valuation & Quarterly Performance
Following the rough stretch of price action, the company’s valuation multiples have drifted lower. Currently, TSLA shares trade at a 4.4X forward price-to-sales ratio, beneath its 6.5X five-year median and a fraction of 2022 highs of 23.4X.
Image Source: Zacks Investment Research
In addition, the company has posted strong bottom-line results as of late, exceeding the Zacks Consensus EPS Estimate by double-digit percentages in seven consecutive quarters.
Revenue results have left some to be desired as of late, with TSLA falling short of sales expectations in back-to-back quarters. Below is a chart illustrating the company’s revenue on a quarterly basis.
Image Source: Zacks Investment Research
Bottom Line
Various issues have plagued Tesla (TSLA - Free Report) shares as of late, including COVID-19 disruptions, lower-than-expected Q4 deliveries, and talks of softening demand.
In addition, the company is currently a Zacks Rank #4 (Sell), indicating that its near-term earnings outlook has come under pressure.
On a brighter note, the company’s valuation multiples have seemingly come back to earth, perhaps enticing those with a long-term horizon. Still, waiting until positive earnings estimate revisions start rolling in would be a much better approach.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
What Happened to Tesla Shares?
Tesla (TSLA - Free Report) shares undoubtedly jump to the forefront of many minds when considering exciting investments. After all, it’s easy to understand why, as the company has entirely changed the way we see the automotive landscape.
And, of course, TSLA shares have long been outperformers, up nearly 5000% just over the last decade and crushing the S&P 500.
However, Tesla shares have been punished over the last month, as shown in the chart below.
Image Source: Zacks Investment Research
It raises a valid question: what’s been going on?
Let’s take a closer look.
Near-Term Headaches
First of all, Tesla’s total EV deliveries are always closely monitored.
It's an absolutely vital metric because, of course, it shows how many EVs Tesla has been able to place in the hands of customers.
And on Monday, Tesla reported Q4 deliveries of roughly 405,000. On the surface level, this would be fantastic, representing another quarter of record deliveries for the EV titan.
However, the reported figure fell short of estimates, sending shares downward in Tuesday’s session. Our consensus estimate stood at 407,855.
The worse-than-expected EV deliveries number came in a quarter that was already negatively impacted by COVID-19 disruptions, causing its Shanghai plant to reduce production.
All in all, reduced production at its Shanghai location, a miss on deliveries, and concerns of weakening demand have all been a thorn in the side of Tesla over the recent months.
How else does everything look?
Valuation & Quarterly Performance
Following the rough stretch of price action, the company’s valuation multiples have drifted lower. Currently, TSLA shares trade at a 4.4X forward price-to-sales ratio, beneath its 6.5X five-year median and a fraction of 2022 highs of 23.4X.
Image Source: Zacks Investment Research
In addition, the company has posted strong bottom-line results as of late, exceeding the Zacks Consensus EPS Estimate by double-digit percentages in seven consecutive quarters.
Revenue results have left some to be desired as of late, with TSLA falling short of sales expectations in back-to-back quarters. Below is a chart illustrating the company’s revenue on a quarterly basis.
Image Source: Zacks Investment Research
Bottom Line
Various issues have plagued Tesla (TSLA - Free Report) shares as of late, including COVID-19 disruptions, lower-than-expected Q4 deliveries, and talks of softening demand.
In addition, the company is currently a Zacks Rank #4 (Sell), indicating that its near-term earnings outlook has come under pressure.
On a brighter note, the company’s valuation multiples have seemingly come back to earth, perhaps enticing those with a long-term horizon. Still, waiting until positive earnings estimate revisions start rolling in would be a much better approach.