Electric vehicle (EV) maker Tesla (NASDAQ:TSLA) posted stellar global vehicle delivery numbers for the second quarter ending June 30, 2023. The EV behemoth delivered 466,140 autos in Q2, jumping 83% year-over-year and over 10% sequentially. Further, Tesla manufactured 479,700 autos in the quarter, growing its production capabilities more than deliveries for the fifth consecutive month. A series of price cuts on Tesla’s popular models during the quarter, enhanced manufacturing capabilities at its Giga factories, and a pick-up in demand from China may have led to the jump in deliveries.
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Ahead of the delivery report, Deutsche Bank analyst Emmanuel Rosner hiked up the delivery expectations for Tesla to reach 448,000 units for the quarter. Meanwhile, the consensus was pegged at 445,000 deliveries. Tesla even outpaced the revised delivery expectations for the June quarter. It is commonly believed that deliveries translate into sales figures, and Wall Street is excited about the EV maker’s second-quarter results, scheduled for July 19, 2023. For Fiscal year 2023, Tesla has set a target to manufacture 1.8 million EVs globally.
Is Tesla Stock Good for the Long Term?
Tesla stock has gained 142.2% so far in 2023, thanks to key partnerships with players like General Motors (NYSE:GM), Ford (NYSE:F), and Rivian (NASDAQ:RIVN). Plus, the company is gaining ground in China this year after witnessing a steep decline last year due to a zero COVID policy-related shutdown in its plant. Moreover, Model 3 and Model Y customers have become eligible for the $7,500 EV tax credits available under the Inflation Reduction Act (IRA), boosting demand further.
However, the multiple price cuts undertaken so far this year have put pressure on Tesla’s margins, but CEO Elon Musk has proclaimed that he prefers sacrificing short-term profitability over long-term growth prospects. Both Wall Street and investors eagerly await the Q2 financial results to see how the price cuts have impacted operating margins in the quarter.
Following the EV delivery report, Citi analyst Itay Michaeli reiterated a Hold rating on TSLA stock with a price target of $215, implying 17.9% downside potential from current levels. Overall, Tesla stock has a Moderate Buy consensus rating on TipRanks. This is based on 14 Buys, 12 Holds, and five Sell ratings. Also, the average Tesla price target of $218.58 implies 16.5% downside potential from current levels.
