Tesla Earnings: Tesla Beats Expectations, again

Tesla Earnings: Tesla Beats Expectations, again
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Tesla Earnings for Q4: Tesla Beats Expectations

Tesla Earnings: Q4 Results in Detail

Metric
Q4 Performance
Revenue
17,719 M
Revenue Growth, YOY
65%
Adjusted EBITDA
4,090 M
Adjusted EBITDA Growth, YOY
121%
EPS (Adjusted)
$ 2.54
EPS (Adjusted) Growth, YOY
218%

Tesla Call Url

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Tesla closes 2021 on a high note by besting expectations in Q4

Tesla Stock Price in after hours trading: $ 930.74, Down 0.71%

Tesla Earnings Estimates Analysis

Tesla has been under pump in last three months and sadly for investors, it has underperformed in 2021 as compared to S&P 500. Tesla shares gave total return of 5.6% over the past year as compared to 14.4% return of S&P500. Also Tesla stock is down by nearly 15% over the past month, and is 25% (approx.) down from its all- time high of $1229 in early November, after which it just spiraled back to $900 level, matching the year start and thrashing the hopes of investors to make a decent return out of EV leader.

It has been seen in the past that quarter results prove to be a major catalyst in reversing the trend, it can either create belief in the investors or ignite panic selling just post results. Tesla is in down spree over the past few days and has seen some thrashing.

Will Q4 results change the stock direction or will it be another reason to aggravate selling in the high P/E stock. Let’s find out  

Tesla Earnings: Earnings History

Tesla has always announced better than expected results over the past couple of years. In an automaker quarterly results there are three important parameters- EPS, Revenue and Vehicle deliveries. Here is a summary of last two quarters results and how Tesla fared in 2021:

  • Q3 FY 2021 earnings was a mixed bag. Adjusted EPS did beat market expectations and rose 144% as compared to same quarter in the prior year, but it did decelerate as was reported in Q2 FY 2021. Revenue even after rising by 56.9% YoY, missed market estimates. The company targeted chip shortages, congestion over ports and rolling blackouts as possible reasons of preventing its factories to run at optimal efficiency for missing the target in terms of revenue.
  • Q2 FY 2021 was a big boost for company. It beat analysts estimate in both fields- EPS and revenue. Adjusted EPS was 231% up YoY, however decelerating from the previous quarter growth of 306%. Revenue also grew at 98% compared to same quarter of previous year. The company thanked its employees for working hard in times of pandemic and amid atmosphere of chip shortage to keep the production close to full capacity.

Tesla Earnings: Expectations from Q4

If analysts are to be believed, Tesla Q4 earnings estimate, adjusted EPS should increase 190% YoY. This is an important figure as it will represent an acceleration from the previous quarter EPS growth. Revenue is expected to grow around 56% YoY, similar rate to what we have seen in the previous quarter. Also, analysts expect EPS to grow at 193% for full year and with it Tesla will report positive EPS for third straight year. Revenue is forecasted to grow at 67%, representing fastest rate of growth since FY 2018.

Key Stats for Tesla Inc for Q4 2021

Metric
Q4 FY 2021
Q4 FY 2020
Q4 FY 2019
Adjusted EPS
2.33( Estimate)
0.80
0.41
Revenue
16.8 (Estimate)
10.7
7.4
Vehicle Deliveries
308,600 (Actual)
180,570
112,000

The important point to note in the above table is that Tesla already announced actual delivery stats in January start and it enabled analysts to be positive in terms of revenue and EPS for Tesla Q4 earnings. Tesla reported strong delivery numbers in each of the four quarters for 2021 and 87% jump YoY is a resultant of it. Annual vehicle deliveries rose only 35% in 2020 and 49% in 2019. So compared to past couple of years, Tesla has reported a handsome figure of vehicle deliveries. It has increased the Tesla Q4 earnings expectations.

Growth in FY 2021 was particularly strong in the first half as compared to later one. Quarterly vehicle deliveries were up 108% YoY in Q1, 121% in Q2 before falling to 73% in Q3 and finally 71% in Q4. 

Tesla Earnings: Focus on Future Plans

It is anybody’s guess that Tesla Q4 earnings numbers will be strong. But the interesting part will be commentary and guidance for future. What will be forecast of delivery and production for the first quarter of 2022 and for complete year? Also, topic on mass production of Cybertruck will not be untouched and there are rumors that it might delay for another year or two.

Also, Tesla did not submit the breakup of delivery numbers for Q4. It will be interesting to note the portion of China’s mainland in this delivery jugglery and how Tesla prepares to ramp up production in China, keeping US media and critics silent.

Date of start of production in Austin and Berlin gigafactories will also be in focus. Tesla has an ambitious plan to reach delivery targets of 2 million units by end of 2022 and these factories will be key to achieve this. It is true that Tesla has better managed the supply chain issues and outweighed its rivals, and there must be a plan ready to fight with such crunches in 2022. It will be better if top executives touch upon this topic while declaring results.

At last, investors do want to hear about Elon Musk’s plan of offloading shares, it is hard that it be touched upon, as the announcements are mainly through twitter, but any hint towards this topic will be keenly watched.   

Also Read: Tesla Stock Split

Also Read: Tesla Stock Forecast 2022

Tesla Earnings: Effect on Stock Price

Tesla Q4 earnings
  • For a start, Tesla shares are up by 4.1% at 12:04 pm GMT-5 on 26th January. Tesla is expected to declare results after the market hours and looking at the stock price, market seems to be optimistic about the results.
  • Tesla share has seen some volatile days for last couple of weeks, building to this quarter results, it is highly expected that this volatility subsides and a clear direction is seen in the share price post result declaration.
  • $950 per share is an important level as it is monthly pivot level. If share sustains this level post results for a week or so, a fresh bull run can start for Tesla Inc.

Tesla Earnings: Conclusion

Tesla has set bar very high for itself for result day. The numbers will be very strong, no doubt, but any disappointment in the guidance for next financial or delay in Cybertruck production news will be taken in good spirit. According to Investing.com Tesla stock is trading at 12 months’ price to earnings ratio of 279 and that leaves no space for making error for Tesla Inc.

Investors are currently turning their faces away from high growth stocks due to the fears of high interest rate, possible global wars and Omicron scare and moving towards less expensive stocks in terms of P/E. Fingers are crossed that Tesla Q4 earnings quarter results do not add one more reason to turn away from Tesla stock for short time period. 

Why We Expect Tesla (TSLA) to Deliver Q4 Earnings Beat

Tesla (TSLA) Q4 2021 earnings preview: Here’s what to expect

Vineet Agarwal

Note: Crowdwisdom360 collates Predictions and data from all over the net and has no in-house view on the likely trends in the Stocks or Crypto Coins. Please consult a registered investment advisor to guide you on your financial decisions.

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