Tesla (TSLA) will report third quarter results this afternoon. Chief Executive Elon Musk will host a call at 5:30 PM.
On October 2, Tesla announced record third quarter deliveries (total EVs +16% yr/yr to 97,000 with Model 3 +42% to 79,600 and Model S/X -37%) which narrowly missed estimates after an email from Elon Musk to employees targeting 100,000 deliveries was leaked in the press in the week prior.
Analysts expect third quarter adj. EPS of ($0.23) vs. a profit of $2.90 last year with revenue down 5% to $6.48 bln.
Last quarter, Tesla said the business has "grown to the point of self-funding."
Tesla will need to have a record fourth quarter in order to hit its 360,000-400,000 delivery goal for the year.
Last quarter, the company said Model Y production was on track for the fall of 2020.
TECHS:
Tesla is expected to lose more than $3/share (adjusted) this year. Tesla was expected to earn $3/share six months ago and $6/share at the beginning of the year. As a result, the stock is down 23% year-to-date.
Tesla has a $46 bln market cap and trades at ~18x forward EV/EBITDA a significant premium the larger automakers. Some 26% of the 141 mln share float was recently sold short. The options market is pricing in a ~8% move in the stock by Friday.
Tesla trades on four items:
Sales Deliveries (Model 3)
Net Income
Margins
Cash Flow
We already got the deliveries numbers in advance of earnings as musk likes to pump his stock ahead of the (typically) bad news. The point for this one is can musk distract people from the ugliness that is “probably” going to come from the report. If he can, you will likely get a continuation higher in the name to squeeze out poorly positioned shorts.
The 281 level looks like a great place to fade the name should fatigue set in there as highlighted by the pink arrow above.
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