Investors ‘more inclined to give Tesla a pass this time,’ analyst says
Tesla Inc. is expected to report first-quarter sales later this week, with Wall Street expectations dulled by ongoing chip and parts shortages and investors still miffed that the company did not set up specific sales goals for the year.
Analysts surveyed by FactSet expect Tesla to have sold 168,000 vehicles in the first quarter, including 122,600 Model 3 sedans and about 10,000 Model Y compact SUVs.
For all of 2021, the analysts surveyed by FactSet expect Tesla to deliver 809,000 vehicles. Tesla has not issued a direct guidance for 2021 sales.
When the company reported fourth-quarter earnings in January, it said it planned to grow its manufacturing capacity “as quickly as possible,” and, as far as deliveries, it said it expects to reach a 50% average annual growth over a “multiyear horizon.”
The executives said then they expect to grow more than that in 2021. The company delivered 499,550 vehicles in 2020, a tad shy of Wall Street consensus and its own guidance of half a million vehicles in the year.
Investors are likely to focus less on this quarter’s deliveries compared with past quarters since Tesla did not tie itself to specific target, “which we think helps take some of the pressure off management and other workers,” CFRA analyst Garrett Nelson told MarketWatch.
“Investors also tend to have lower expectations for auto sales in Q1 given normal seasonality and recent reports of shortages of semiconductors and other parts, which has hampered production and helped lower the bar,” he said.
Earlier on Tuesday, Chief Executive Elon Musk tweeted that a battery-cell parts shortage was hampering the scaling up of the Tesla Semi, the company’s commercial truck. That “limitation will be less onerous next year,” he said.
Investors are looking for the more long-term developments for Tesla, such as the timing of the start of its new factories going up in Austin and in Berlin, and future models, he said.
“As long as their sales volumes didn’t completely fall apart in Q1, we think investors will be more inclined to give Tesla a pass this time,” Nelson said.
Joseph Spak at RBC Capital said he expects sales around 170,000 vehicles for the quarter, although he called the consensus numbers “reasonable,” saying the expects “way less” Model S luxury sedans and Model X luxury SUVs than the rest of his peers.
Jeffrey Osborne at Cowen said he had trimmed his first-quarter sales expectations to 172,000 vehicles, from 178,000, given “logistics challenges, a two-day shutdown in Fremont, and component shortages.”
Shares of Tesla have gained more than 500% in the past 12 months, compared with gains of around 51% for the S&P 500 index. SPX,