Tesla (NASDAQ:TSLA) saw its shares decline this week after Wall Street reacted negatively to the EV giant’s latest delivery numbers. In Q3, Tesla delivered 462,890 vehicles, missing the consensus estimate of 463,897 units.
However, while investors voiced their displeasure, Canaccord analyst George Gianarikas has no qualms about the readout.
“Yes, deliveries were a smidge light relative our expectations,” Gianarikas says, but goes on to make the case that the real story behind the delivery results was “confirmation that the company is outperforming its fellow Western OEMs in a big way.”
Gianarikas elaborated further, noting that, in recent weeks, reports of supply chain disruptions across the auto industry have been prevalent. Tesla, however, seems to have sidestepped this trend and returned to year-over-year growth.
Tesla’s Q3 delivery figure represents a ~4.3% increase over the 443,956 vehicles delivered in the previous quarter and a ~6.4% rise from the 435,059 vehicles delivered during the same period last year.
The improvement is mainly down to a strong showing in China, with Gianarikas thinking the trends exhibited in the region point to what is coming next. “There,” Gianarikas says, “EVs and hybrids are crushing the traditional auto market — and most Western OEMs are bleeding.”
In Gianarikas’ view, the main issue facing most Western OEMs is that they are just not ready to compete effectively in these segments. The data supports this take as sales of ICE vehicle sales in China have significantly declined, while EVs, particularly hybrids, are seeing substantial growth.
Tesla, however, is managing to hold its ground in this highly competitive market due to it having a “compelling” EV – something other manufacturers currently lack.
Next in the Tesla diary is the much-talked-about “We, Robot” event on October 10. Plenty of market watchers – Gianarikas included – are skeptical regarding the near-term availability of its robotaxi. As such, heading into the event, expectations are rather muted, although Gianarikas thinks there’ll be enough fireworks to keep investors happy. “We do nevertheless expect some ‘wow’ moments in LA,” he said. “Get ready, next week is showtime.”
Meanwhile, Gianarikas issued a Buy rating on Tesla shares although his $254 price target suggests a modest 6% upside from current levels. (To watch Gianarikas’ track record, click here)
11 other analysts also think TSLA stock is a Buy right now, but they are pitted against 16 Holds and 7 Sells, making the consensus view here a Hold. Over the next year, shares are expected to post a decline of 12%, considering the average price target currently stands at $210.91. (See Tesla stock forecast)
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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
