Tesla deliveries in the third quarter fell below Wall Street predictions, marking a substantial decline compared to the global EV giant's record-setting number in the second quarter. TSLA edged up Monday afternoon.
Elon Musk's Tesla reported Monday that it produced 430,488 vehicles and delivered 435,059 during the third quarter. Tesla deliveries fell 6% compared to Q2 with the EV reporting Monday the drop-off was due to "planned downtimes for factory upgrades, as discussed on the most recent earnings call."
The company delivered 15,985 Model S/X vehicles and 419,074 Model 3/Y vehicles in Q3. Tesla reiterated Monday that its 2023 volume target of around 1.8 million vehicles.
Tesla stock gained 0.6% to 251.60 Monday during market action. On Friday, TSLA gained 1.6% to 250.22.
Tesla Misses Analyst Predictions
Ahead of the release, analyst consensus had deliveries around 461,000, according to FactSet. However, other Wall Street estimates had consensus closer to 455,000. Production fell as Tesla temporary shut down factories and generally slowed output.
Some of that reflected manufacturing upgrades for the refreshed Model 3 in China and the upcoming Cybertruck, but it appears Tesla was seeking to pare down swelling inventories.
Rivian Surprises Wall Street With Q3 Vehicle Deliveries Growing 140%
The global EV giant announces full third-quarter earnings and will hold its earnings call around Oct. 18.
On Sunday, Tesla launched a slightly updated Model Y in China, with the base and Long Range variants getting a bump in range. The Model Y in China faces a growing number of high-spec crossover rivals, many at lower prices.
Tesla Stock: Bull's-eye Cybertruck
Before Monday, Tesla bulls were already looking past Q3 deliveries, betting on a strong Q4 recovery and the expected Cybertruck launch.
"We are now set to be entering the next stage of growth for Tesla globally with the Model 3 refresh front and center in China and the Cybertruck production set to kick off beginning around Halloween," Wedbush analyst Dan Ives, a longtime Tesla bull, wrote on Friday.
However, last week Deutsche Bank analyst Emmanuel Rosner outlined a more pessimistic view, dropping the firm's price target on Tesla stock to 285 from 300. Rosner predicted Tesla deliveries of 440,000.
Moreover, Rosner sees "meaningful downside risk" to 2024 consensus estimates due to limited volume growth. Deutsche Bank expects 2024 deliveries to total 2.1 million, below the current consensus of 2.3 million units. Rosner also sees 2024 EPS of $3.90, which would be below 2022 profit levels. Wall Street predicts 2024 earnings of $4.68 per share, according to FactSet.
Tesla's Second-Quarter Deliveries
In early July, TSLA reported record global deliveries — as price cuts, tax credits and discounts propelled demand well above Wall Street forecasts.
Tesla deliveries ran to 466,140 in the second quarter, sprinting past Q1's record 422,875 and Q4's 405,278. Model 3 and Y deliveries hit 446,915 in Q2. Model S and X deliveries picked up to 19,225. Production hit 479,700, exceeding deliveries once again, even with Tesla curbing output below capacity.
Meanwhile, Chief Executive Elon Musk told investors during the Q2 earnings call that the company is targeting 1.8 million vehicles deliveries in 2023. However, Musk also warned third-quarter production will likely "be a little down" due to summer shutdowns for factory upgrades.
Analyst consensus, as of Sept. 28, has Tesla full-year 2023 deliveries totaling 1.84 million units, according to FactSet.
Tesla Stock Performance
Tesla stock rose 2.2% to 250.22 last week. Shares briefly cleared the 50-day line on Friday before paring gains. A decisive move above the 50-day could offer investors an early entry.
Tesla stock has a proper cup-with-handle base, giving it a 278.98 buy point, according to MarketSmith analysis.
Meanwhile, analysts maintain that the United Auto Workers strike against Ford, General Motors and Stellantis is good news for nonunion Tesla.
Tesla stock ranks fourth in the 35-stock IBD automaker industry group. The S&P 500 component has a 95 Composite Rating out of 99. Shares have an 91 Relative Strength Rating and its EPS Rating is 93 out of 99.
Please follow Kit Norton on X, formerly known as Twitter, @KitNorton for more coverage.
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