Arcadia Power



Author Topic: Stock Market News –Tesla’s quarterly report to halt slide in stock price?  (Read 137 times)


  • Administrator
  • Hero Member
  • *****
  • Posts: 1785
    • View Profile
Stock Market News –Tesla’s quarterly report to halt slide in stock price?

Tesla’s earnings report for Q2 2018 will be going public after the US market close on Wednesday. The consensus recommendation for the company is “hold”, which negatively compares to the average consensus recommendation of the Auto & Truck Manufactures peer group.

The electric-vehicle maker’s earnings per share are anticipated to stand at -$2.89 during the quarter ending in June, according to Thomson Reuters consensus estimates; in other words, the firm is expected to record a loss. Current projections reflect a deterioration from $2.71 in losses per share from four weeks ago, while if forecasts are met, this would represent an increase in losses of around 117.5% compared to the same quarter last year when the corporation lost $1.33 per share. Additionally, EPS expectations range from -$3.44 to -$2.19. In the meantime, Tesla managed to deliver better results than Wall Street analysts’ profit estimates in three of the four previously reported quarters, while doing worse than forecasted once.

The firm’s quarterly revenues, anticipated at $3.96 billion from $2.79bn in Q2 2017, will also be scrutinized by investors; despite the automotive business making the bulk of revenues, sales stemming from the energy generation and storage segment will also be monitored. All in all, and combined with the abovementioned, the consensus view is that the company will post much bigger losses on considerably larger sales. Meanwhile, similar to Q1, cash considerations will come to the fore. Does the corporation have enough cash for the year, or will it need additional financing? Should the latter be the case and given that CEO Elon Musk has indicated in the past that the firm will not require equity or debt financing this year, it will likely be perceived as a negative sign by market participants, hence weighing on the stock.

Other areas of interest will pertain to gross margins and net reservations (new orders minus cancelled reservations) for Model 3, this being the company’s vehicle that’s directed to the mass market and which has been facing production lags. In this respect, an update on production will also probably prove of importance.

Overall encouraging results by the carmaker are likely to spur long positions on its stock, with initial resistance to gains possibly coming around the $300 mark which may hold psychological significance. Not far above lie the current levels of the 100- and 50-day moving average lines – at $307.39 and $316.66 respectively – that may act as barriers to stronger bullish movement. Conversely, a weaker than anticipated report is expected to see the shares come under selling pressure. Support to losses could take place around the four-month low of $273.42 from May 22, with a downside violation increasingly bringing into scope the 17-month low of $244.59 hit in early April.

Technically, the stock appears negative in the short-term – the RSI is in bearish territory and continues declining. As regards the medium-term outlook, it does not look much rosier, with trading taking place below the 50- and 100-day moving average lines. The shares lost 5.4% of their value this week (on Monday and Tuesday), falling in “sympathy” to other Nasdaq stocks that experienced losses on poor earnings, but also being dragged on the back of several Wall Street analysts striking a note of caution ahead of Wednesday’s report, expressing concerns about the corporation’s cash flow, whether Model 3 production can be sustained after Tesla reached the 5,000-cars-a-week milestone at the end of June, as well as sounding the alarm on gross margins. It remains to be seen whether the upcoming report will shift the momentum towards a positive direction.

Tesla is one of the stocks that constitute the Nasdaq 100. Year-to-date, the corporation’s shares are trading lower by 6.8%, underperforming the benchmark’s equivalent performance of +12.5%. Analysts’ mean price target on the stock is at $295.05.

Lastly, it should be kept in mind that Elon Musk’s earnings call during Q1 provided some unexpected “drama”, with the CEO expressing his discontent with “boring” questions, which he avoided answering. As a result, the stock market punished the company. This renders the second quarter’s earnings call all the more important.


Share on Facebook Share on Twitter


Pay For Premium Forex Signals FXSHOOTING

Payment Premium Signals






Risk Disclosure: Fusion Media will not accept any liability for loss or damage as a result of reliance on the information contained within this website including data, quotes, charts and buy/sell signals. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible. Currency trading on margin involves high risk, and is not suitable for all investors. Trading or investing in cryptocurrencies carries with it potential risks. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Cryptocurrencies are not suitable for all investors. Before deciding to trade foreign exchange or any other financial instrument or cryptocurrencies you should carefully consider your investment objectives, level of experience, and risk appetite. Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures), Forex and cryptocurrencies prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn’t bear any responsibility for any trading losses you might incur as a result of using this data. Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.