Investors were mixed when Tesla (NASDAQ:TSLA) announced its Q3 delivery numbers. The company produced 430,488 vehicles in the quarter, delivering 435,059 units, which fell some distance below the Street’s estimated figure of 455,000. For comparison purposes, in Q2, deliveries reached 466,140 units, easily surpassing the forecasted 445,000. However, the EV leader did stick to its full year guide.
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Breaking down the numbers, Model 3/Y deliveries came in at 419,100 (Street had 441.1k) and Model S/X units came in at 16,000 (Street was looking for 18.5k).
Tesla laid the blame at the lackluster showing to longer than expected downtime in its Shanghai and Austin facilities, not entirely unexpected, as during the Q2 call, CEO Elon Musk warned of summer shutdowns needed for factory upgrades.
According to Wedbush’s Daniel Ives, a 5-star analyst ranked in the top 2% of the Street’s stock professionals, the delivery shortfall in Q3 could mean that probably ~20,000 units will be included in the Q4 figures. He interprets the factory upgrades as part of Tesla’s broader expansion strategy, as the company gears up for increased production, scale, and the launch of new models over the next year.
“With price cuts mostly in the rear-view mirror providing stability in prices going forward,” the 5-star analyst went on to say, “we believe Tesla is now set to be entering the next stage of growth for the company globally with the Model 3 refresh front and center in China and Cybertruck production set to kick off beginning around Halloween.”
Tesla still expects to deliver 1.8 million units this year, but to hit that number, it will need to put in a strong showing in Q4. “Even when factoring in the shutdowns with no rose colored glasses Tesla clearly missed Street estimates this quarter with bulls left disappointed,” Ives summed up, before mirroring investor sentiment, by adding, “although we see better days ahead for 4Q and 2024.”
Meanwhile, Ives maintained an Outperform (I.e., Buy) rating on Tesla shares to go alongside a $350 price target, suggesting the stock will climb 36% higher over the next 12 months. (To watch Ives’ track record, click here)
Tesla always elicits a wide range of opinions on Wall Street and that is the case at present, too. The stock claims a Moderate Buy consensus rating, based on a mix of 12 Buys, 13 Holds, plus 4 Sells. The shares have room for a modest 2.6% growth from current levels, given the average target currently stands at $264.56. (See Tesla stock forecast)
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Disclaimer: The opinions expressed in this article are solely those of the featured analysts. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
