Tesla stock extends drop in New Year, ‘becoming long-term hold’
Tesla stock The market is expected to trade at a lower level in 2023. Below analysts’ estimates, fourth quarter delivery numbers were lower than expected.
January 2nd saw deliveries for the electric vehicle manufacturer missed by roughly 13,000. The report states that Tesla shipped 405,000 vehicles in the quarter, which was below consensus estimates of 418,000.
Model S/X deliveries rose 9%, while Model 3/Y deliveries grew 4%.
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The company still has to meet its 50% target, even though Tesla’s 2022 deliveries grew by 47% in the fourth quarter.
Edward Moya is a senior market analyst at OANDA New York. He said that “Tesla share price remains in freefall as deliveries struggle. Musk remains CEO Twitter, and recession worries weigh on the EV demand outlook throughout the year.”
“Tesla has the potential to become a long-term holding, but there could be more pain,” he said. “The growth opportunity overseas is still there, but the rising competition will make this a hard rebound once Tesla shares hit bottom.”
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In a report Monday, JPMorgan analyst Ryan Brinkman said the investment bank was lowering its estimates and price target following Tesla’s miss on deliveries “which tracked modestly higher than our model but seemingly at the cost of higher incentives, suggesting lower pricing and margin.”
“We are not significantly lowering our estimates today (2023 to $4.60, 2024-to $5.15, $5.35 and 2025-to $5.55, respectively, and 2025-to $5.55, from $5.65), although we are reducing December 2023’s price target to $125, $150 on expected multiple compression, as growth expectations moderate,” Brinkman stated.
Tesla reported 2021 basic earnings per stock of $5.60. On Jan. 25, the company reported 2022 full-year and fourth quarter results.