Tesla stock was handed two price target revisions Wednesday as analysts project 2024 vehicle deliveries could undercut last year's total with profit forecasts continuing to fall ahead of first-quarter earnings.
Jefferies analyst Philippe Houchois lowered his Tesla stock price target to 165 from 185 Wednesday while Piper Sandler analyst Alexander Potter cut the firm's price target to 205 from 225.
Houchois expects Tesla will deliver 1.77 million vehicles in 2024, below the 2023 record of 1.81 million. The analyst also reduced his 2024 EBIT and EPS estimates by around 30% to $6.5 billion and $1.87, respectively. With Tesla reporting first-quarter earnings on April 23, Houchois wrote the situation continues loading "more drama into Q1 results," including questions about product priorities and leadership.
Jefferies also expects Q1 cash burn should be "heavily negative." Piper Sandler sees full-year deliveries slipping to 1.79 million.
On Tuesday, Baird analyst Ben Kallo estimated 2024 deliveries will total 1.84 million, writing that second-quarter deliveries are likely to decline compared to last year.
The consensus view is 1.94 million deliveries, according to FactSet. However, that number is likely to be adjusted following Tesla's worse-than-expected Q1 delivery result.
Meanwhile, Tesla vehicle insurance registrations in China for the week of April 1-7 totaled 1,880, according to CnEVPost. That's down around 40% compared to last quarter and a 70% decline to the same period in 2023.
"There is no denying that the demand environment has deteriorated," Kallo wrote.
Tesla stock fell 2.9% to 171.72 during market action Wednesday. On Tuesday, TSLA shares gained more than 2% to 176.88. The stock is up 7.3% so far this week.
Tesla EPS Estimates Keep Falling
The recent analyst notes come as Wall Street consensus has 2024 Tesla earnings firmly below 2023's level. That signals another year of earnings declines for this growth stock. Wall Street currently expects Tesla earnings per share of just $2.71 in 2024, according to FactSet. That would be more than a 13% decline vs. last year's $3.12.
Wall Street's 2024 EPS consensus estimates for Tesla have now come down 29% since the end of 2023. With Tesla reporting earnings on April 23, Wall Street is likely just beginning to cut earnings predictions. Some analysts believe earnings could drop even further, potentially around 2021 EPS of $2.26.
Looking further out, Wall Street consensus has Tesla's EPS in 2025 coming in at $3.72, down from the $5.29 projection at the end of 2023, according to FactSet.
Tesla And The Robotaxi
Reuters reported Friday the EV giant has canceled its long promised next-generation $25,000 vehicle, choosing to focus on developing its self-driving robotaxi platform.
Reuters, citing three anonymous sources and internal messages, wrote that Tesla no longer plans to make its low-cost entry-level vehicle, the Model 2, and will continue developing its robotaxi on the "same small-vehicle platform."
However, Chief Executive Elon Musk and others at Tesla have challenged the veracity of the report.
Following the publication of the Reuters story, Musk also announced Tesla will unveil the robotaxi on Aug. 8.
On Tuesday, Morgan Stanley analyst Adam Jonas, a Tesla bull, wrote that canceling or delaying the Model 2, could be a "recognition that making and selling EVs in a traditional consumer model may not create lasting economic value."
Jonas added that while the firm is prepared for Tesla to unveil a robotaxi-prototype in August, it is cautious on "potential commercialization timelines for a fully autonomous taxi service."
Morgan Stanley expects Tesla 2024 EPS to sink to $1.12.
Tesla Stock Performance
Last week, Tesla stock sank 6.2%, including a 3.6% dip Friday, to 164.90. Cathie Wood purchased nearly 453,000 shares of Tesla during the week, according to the daily trade disclosures. TSLA shares are trading below the 50-day moving average after falling around 13% in March.
The prior week, Tesla gained 2.9% to 175.79 as the EV company started rolling out its latest full self-driving update to customers.
Emails sent by Elon Musk leaked on social media platforms show he is making it mandatory in North America to install and activate the latest version of FSD on vehicles and to take customers on a "short test ride before handing over the car."
Tesla is also offering a one-month free trial of FSD for April in the U.S. for new purchases or existing EVs that are FSD capable.
Tesla Stock Has Plunged In 2024, But At Least It's Cheaper, Right? Nope
The EV giant ranks eighth in the 35-member IBD Auto Manufacturers industry group. The stock has a 32 Composite Rating out of a best-possible 99. Tesla stock also has an 11 Relative Strength Rating and a 67 EPS Rating.
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