Electric vehicle leader Tesla Inc TSLA is set to report second-quarter financial results after market close Wednesday. Here’s a look at the key estimates from analysts, what analysts are saying and how the company unveiling its Cybertruck could impact the stock moving forward.
Earnings Estimates: Analysts expect Tesla to report second-quarter revenue of $24.53 billion, according to estimates from Benzinga Pro.
Estimates call for the company to report 81 cents in earnings per share for the second quarter.
Tesla reported 76 cents in earnings per share and revenue of $16.93 billion in last year’s second quarter.
The electric vehicle company posted revenue of $23.33 billion and earnings per share of 85 cents in the most recently reported first quarter.
Tesla has beaten or matched earnings per share estimates in each of the last nine straight quarters. The company has beaten revenue estimates from analysts in six of the last eight quarters.
The company previously reported second-quarter production and delivery figures. Tesla reported deliveries of 466,140 units in the second quarter and produced 479,7000 units in the second quarter.
Related Link: Elon Musk Can Be Destructive Says Biographer Who Shadowed The Billionaire For 3 Years
Cybertruck News: The highly anticipated electric pickup truck could get the spotlight during Tesla’s second-quarter earnings report and conference call. The company recently unveiled the first model rolled off the production line.
Ahead of Tesla’s earnings, rival companies Ford Motor Co F and Rivian Automotive Inc RIVN have cut prices on their electric pickup trucks.
“While Ford said the cuts reflect improvements in scale and battery raw material costs, we believe Ford wanted to get in front of imminent Tesla Cybertruck pricing for the September delivery event,” Future Fund Managing Partner Gary Black said.
Wedbush analyst Dan Ives also sees the pricing updates for Ford related to Tesla’s upcoming vehicle launch. “Ford hears footsteps of Cybertruck and Rivian,” Ives recently tweeted.
The Cybertruck remains one of the most anticipated vehicle launches of all time with estimates saying more than a million vehicles have been reserved.
Tesla CEO Elon Musk previously said expectations for the Cybertruck in 2023 could be too high.
“We do expect production to start, I don’t know, maybe sometime this summer. But I always like to try to downplay the start of production because the start of production is always very slow. It increases exponentially, but it’s always very slow at first. So I wouldn’t put too much thought into the start of production. It’s kind of when volume production actually happens, and that’s next year,” Musk said.
Investors and analysts will eagerly await comments on Cybertruck production, pricing and deliveries.
What Analysts Are Saying: Ahead of second-quarter earnings, several analysts have shared updated notes on the stock.
Wells Fargo analyst Colin Langan reiterated an Equal-Weight rating on Tesla while also raising the price target from $170 to $265.
Morgan Stanley analyst Adam Jonas reiterated an Equal-Weight rating and a price target of $250.
“While face value price cuts seem to have stopped for now, investors seem to be all over the place when considering the forces at play to determine 2Q’s GM (gross margins,” Jonas said.
Jonas said Tesla could share more details on its artificial intelligence efforts and growth beyond automotive: “Tesla needs to prove it’s more than just an auto company.”
Wedbush analyst Dan Ives reiterated an Outperform rating and a price target of $300.
Ives sees the important number to watch for the quarter being gross margins excluding credits with a “line in the sand” of 17.5%.
“That should ramp back over the coming quarters and back towards the 20% level heading into 2024,” Ives said.
Ives might also have a warning to analysts and investors looking to treat Tesla as strictly an automotive company.
“With many on the Street they try to put transformational growth names in a little box. Tesla is an auto company it should trade at XX…Apple is a hardware company it should trade at xxx…Is Messi just a futbol/soccer player? Mahomes just a football player? Rafa a tennis player?” Ives asked on Twitter.
New Street Research analyst Pierre Ferragu highlighted a potential earnings disappointment with Tesla’s price cuts leading to potential lower margins.
“Brace for a - short-term, disappointment, with a further slide in 2Q23…But also a good recovery beyond,” Ferragu tweeted.
Ferragu said the company is focused on its production and delivery numbers and maintaining its growth. Price cuts took the average selling price down around $3,000 in the second quarter, which could see gross margins hitting 15.6%.
The company could stop price cuts in the second quarter and will also realize improving costs with further production ramp-ups. Ferragu saw Tesla having long-term auto gross margins of 25%.
“Given Tesla’s cost and product advantage, and knowing that market dynamics will eventually set prices at levels at which some competitors survive, we see its as a necessity,” Ferragu said.
TSLA Price Action: Tesla shares trade at $293.34 on Tuesday at market close versus a 52-week range of $101.81 to $314.66.
After a down year in 2022, Tesla shares are up 169% year-to-date in 2023 and nearing a return to a $1 trillion market capitalization.
Read Next: Here's How Many Vehicles Tesla Has Delivered And Produced In Each Quarter Since 2019
Photo: Courtesy Tesla
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