Tesla, Inc. TSLA reported first-quarter delivery numbers over the weekend that narrowly missed the consensus expectation.
The Tesla Analyst: Piper Sandler analyst Alexander Potter maintained an Overweight rating on Tesla with a $1,350 price target.
JPMorgan analyst Ryan Brinkman maintained an Underweight rating and increased the price target from $325 to $335.
Wedbush analyst Daniel Ives reiterated an Outperform rating and $1,400 price target.
Delivery Miss Is Neither Instructive Nor Predictive, Piper Sandler Says: The Street estimates did not fully capture the impact of a COVID-related lockdown in Shanghai, which is Tesla's most productive facility, Piper Sandler analyst Potter said.
Tesla's actual results were well ahead of Piper Sandler's estimate of 294,000 units, which factored in a more severe impact from COVID, the Chinese New Year and two fewer days in the first quarter relative to the fourth quarter, the analyst said.
The delivery miss isn't instructive or predictive about the future, Potter said. Delivery wait times are still over two to 10 months, depending on the model and region, the analyst said.
"Tesla's market share is still rising," the analyst said.
Potter noted that the daily production rate in the first quarter was 3,393 units, up from 3,324 in the fourth quarter.
Related Link: With Tesla Localizing EV Production, This Analyst Says Musk's Brand Is Becoming A Renewable Energy Play
Tesla Better Positioned To Pass Through Higher Prices, JPMorgan Says: Following Tesla's first-quarter deliveries, which beat JPMorgan's estimates, the firm raised its full-year deliveries estimate from 1,246,250 units to 1,262,798 units, analyst Brinkman said. This is below the company-compiled consensus of 1,446,254 units, the analyst said.
The full-year estimates, according to the analysts, are based on incorporation of the first-quarter beat but no flow through of the strength to the subsequent quarters, given reduced visibility into both supply as well as price.
The analyst said he expects battery metals cost inflation to translate to higher EV prices going forward.
Demand for EVs at current prices appears very strong, Brinkman said. The analyst, however, said he will watch the rate of increase in EV prices relative to gas price increases, as well as the exposure automakers have to pricing for BEV reservation holders that was agreed upon prior to the battery metals inflation.
Tesla could be largely successful in passing along higher prices near-term given its waitlist, the analyst said. This has positive implications for revenue, neutral implications for profit dollars and negative implications for profit margin, he added.
As such, the analyst raised his first-quarter earnings per share estimate from $1.94 to $2.10.
Why Wedbush Is Steadfastly Bullish On Tesla: Roughly 20,000-25,000 units were pushed out of the first quarter into the second quarter due to the logistical and factory issues, Wedbush analyst Ives said. This makes the underlying demand number still look strong with a robust trajectory for the rest of 2022, he added.
"We remain steadfastly bullish on the Tesla story," Ives said.
TSLA Price Action: Tesla shares were rallying 5.93% to $1,148 Monday afternoon, according to Benzinga Pro.
Related Link: As New Two Gigas Come Online, Here's A Look At How Much $1,000 Invested In Tesla At Giga Shanghai's Opening Is Worth Today
Photo courtesy of Tesla.
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