Elon Musk, Tesla Chief Executive Officer, is never bored. He’s one day launching astronauts to orbit the International Space Station. He’s also opening an auto plant in Berlin to a roaring crowd. He’s also jousting with Twitter, after becoming the largest shareholder. Is Tesla stock worth buying?
Tesla (TSLA), reported that it shipped 310,048 vehicles during the first quarter. This is 68% more than the year-earlier period, and just below analysts’ estimates of 312,000.
Analysts expected a decrease in the number of units, as Covid shut downs in China have resulted from the closure of Tesla’s Shanghai electric car plant. In a note to clients, Dan Ives, a Wedbush analyst, stated that this created “massive logistic complications in delivering units to European customers.”
Ives stated that these numbers are positive relative to Ford Motor (F), GM (GM), and Ford Motor (F) and Chinese EV players like Nio (Nio), Xpeng(XPEV) and other players. He also noted that they were a positive step towards the next stage of the Tesla growth story, which will see Austin and Berlin factories being green-lit.
Covid Closes Shanghai Plant
Tesla reported better than expected first quarter earnings on July 21. The company is slowly opening its Shanghai factory which was closed due to an increase in Covid-19 cases.
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Management stated in an earnings presentation that “while weekly production rates were high in Q1, a spike of COVID-19 patients in Shanghai caused our factory and parts of our supply chain to be temporarily shut down,” Although limited production has been restarted recently, we will continue to closely monitor the situation.”
Musk remains optimistic that output will rebound. Musk stated that he expects second quarter production to be the same as first quarter or slightly lower.
He said, “We might be capable of pulling a rabbit out from the hat and being slightly higher.”
First-Quarter Earnings Soar
Tesla’s first quarter earnings per share soared to $3.22 per share. Sales rose 81% to $18.76 million. This is the second consecutive quarter of both companies’ rapid growth. This includes $679million from regulatory credits, which is more than double the amount from the fourth quarter 2021. Twitter stock shot up
The Model Y is currently being shipped from the factory that Tesla opened in Berlin, March 22. The Model Y will be made in Austin by the same plant that opened in Berlin on March 22nd.
However, delivery targets will be difficult due to the ongoing war in Ukraine and parts shortages.
Musk tweeted that “This was an extraordinarily difficult quarter due supply chain interruptions and China zero COVID policies.”
Auto giant General Motors has indicated that it expects to sell 1.5 million electric cars by 2022. If supply problems ease, this could increase to 2 million. This would nearly triple the number of vehicles sold last year.
Twitter Acquired by Elon Musk
As if all that wasn’t enough, Musk announced in April that he had purchased 9.2% of Twitter (TWTR), making him the largest shareholder.
Musk offered to purchase Twitter for $54.20 per share in cash on April 14. Twitter signed a definitive agreement with Musk to acquire Twitter for $54.20 per share in cash, valued at $44 Billion.
Musk wrote that “free speech is the foundation of a functioning democracy” and that Twitter was the digital town square where vital issues for the future of humanity are discussed.
He continued, “I also want Twitter to be better than ever by improving the product with new features and making the algorithms open-source to increase trust, defeating spam bots, authenticating all people,” he said.
Musk hopes to build 20 million electric cars per year in the next ten years. This is more than twice the production of other auto-making companies. It is now on a mission of rapidly expanding its manufacturing capabilities.
Tesla will now be making electric cars in Germany. It will compete with three German brands: Volkswagen Group (VWAGY), BMW Group (BMWYY), and the Mercedes-Benz Division of Daimler AG(DDAIF).
Rivian (RIVN), General Motors, Ford Motor and Ford Motor are other serious competitors. The F-150 Lightning electric Ford truck will be on the road this spring. In the second quarter 2023, the first GM electric Silverado is scheduled to go on the roads. It is intended for fleet operators.
Tesla Stock: Checkout Our Latest Updates
The IBD Stock Checkup tool gives Tesla stock a Composite Rating of 95/99. Focus on growth stocks with a Composite Rating 90 or above to reap the greatest potential gains based on the CAN SLIM investing paradigm.
Also, the stock has a relative strength rating of 87 out 99. This rating indicates that Tesla stock outperformed 87% all stocks in IBD’s database over the past 12 month.
Its Accumulation/Distribution Rating is C. That rating analyzes price and volume changes in a stock over the past 13 weeks of trading. A grade of A indicates heavy institutional buying. E is the lowest possible rating. This means that there are lots of sales. The C grade is neutral.
Timing is crucial in the stock market. When you are looking for stocks to purchase or sell, it is important to perform fundamental and technical analysis to identify lower-risk entry points with solid potential rewards.
Tesla Stock Is It A Good Buy?
According to MarketSmith analysis, Tesla stock has reached a cup-with handle base and has a buy point at 1,152.97. After a 32% increase in shares since mid-March, shares have been taking a break amid a market selloff. It ended regular session trading at 975.93 on April 11.