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Tesla (TSLA) Q4 Earnings Miss Estimates, Revenues Improve
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Tesla, Inc. (TSLA - Free Report) has reported earnings per share of $1.93 in fourth-quarter 2018, missing the Zacks Consensus Estimate of $2.08. The company reported loss of $3.04 per share in the prior-year quarter.
During the reported quarter, net income attributable to common shareholders amounted $344.8 million compared with the year-ago net loss of $513.1 million.
Revenues increased to $7.2 billion from $3.3 billion registered in fourth-quarter 2017. The figure surpassed the Zacks Consensus Estimate of $7.1 billion.
During the quarter under review, Tesla delivered 27,607 Model S and Model X vehicles, and 63,359 Model 3 vehicles to customers.
Total automotive revenues, including revenues from automotive sales and leasing, increased appreciably year over year to $6.3 billion in the reported quarter. The rise was due to a robust increase in Model 3 deliveries.
Energy generation and storage revenues increased from $298 million in fourth-quarter 2017 to $371.5 million in the reported quarter. The rise was mainly due to considerable growth of energy-storage deployments.
Services and other revenues increased 84.4% year over year to $531.2 million.
Tesla’s fourth-quarter 2018 automotive gross margin was 24.3%, increasing 540 basis points (bps) from fourth-quarter 2017.
Energy generation and storage gross margin increased 604 bps on a year-over-year basis to 11.5%.
For 2018, Tesla registered loss per share of $1.33, narrower than loss of $8.66 per share in 2017.
Revenues for 2018 were $18.5 billion, up from $9.6 billion in 2017.
Financial Position
Tesla had cash and cash equivalents of $3.69 billion as of Dec 31, 2018, compared with $3.37 billion, as of Dec 31, 2017.
Net cash provided by operating activities amounted to $1.23 billion in fourth-quarter 2018 compared with net cash of $509.9 million in fourth-quarter 2017. Capital expenditure declined to $325 million from $786.7 million in the year-ago quarter.
Business Expansion
In fourth-quarter 2018, Tesla opened 27 stores and service locations. The company also opened 69 supercharger locations, reaching the global total of 1,421.
Model 3 Update
By mid-2018, Tesla became successful in stabilizing Model 3 production in high volumes. Model 3 turned out to be the best-selling premium vehicle (including SUVs) in the United States in 2018 with around 140,000 units sold.
In fact, the Model 3 production rate rose considerably through fourth-quarter 2018. December 2018 recorded the highest volume in terms of Model 3 production. Moreover, expenses per vehicle continued to decline. Labor time required per Model 3 declined by roughly 20% in fourth-quarter 2018 from that of third-quarter 2018.
Outlook
Tesla anticipates Model 3 volumes in 2019 to grow substantially over 2018 due to high production rates at the Fremont facility. The Model 3 production at this facility is expected to reach a sustained rate of 7,000 units per week by the end of 2019. Including the production at Gigafactory Shanghai, the company targets to manufacture 10,000 vehicles per week on a sustained basis.
Again, Energy generation and storage revenues are likely to increase considerably due to the storage business. Further, the Services and Other business is set to grow in 2019 on account of projected used-car sales volume.
Zacks Rank & Stocks to Consider
Tesla currently carries a Zacks Rank #3 (Hold).
A few better-ranked stocks in the auto space are Dana Incorporated (DAN - Free Report) , Allison Transmission Holdings, Inc. (ALSN - Free Report) and General Motors Company (GM - Free Report) . While Dana currently sports a Zacks Rank #1 (Strong Buy), both Allison Transmission and General Motors has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Dana has an expected long-term growth rate of 2.9%. Over the past three months, shares of the company have risen 14.5%.
Allison Transmission has an expected long-term growth rate of 10%. Over the past three months, shares of the company have surged 10.8%.
General Motors has an expected long-term growth rate of 8.5%. Over the three months, shares of the company have risen 6.8%.
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Tesla (TSLA) Q4 Earnings Miss Estimates, Revenues Improve
Tesla, Inc. (TSLA - Free Report) has reported earnings per share of $1.93 in fourth-quarter 2018, missing the Zacks Consensus Estimate of $2.08. The company reported loss of $3.04 per share in the prior-year quarter.
During the reported quarter, net income attributable to common shareholders amounted $344.8 million compared with the year-ago net loss of $513.1 million.
Revenues increased to $7.2 billion from $3.3 billion registered in fourth-quarter 2017. The figure surpassed the Zacks Consensus Estimate of $7.1 billion.
During the quarter under review, Tesla delivered 27,607 Model S and Model X vehicles, and 63,359 Model 3 vehicles to customers.
Total automotive revenues, including revenues from automotive sales and leasing, increased appreciably year over year to $6.3 billion in the reported quarter. The rise was due to a robust increase in Model 3 deliveries.
Energy generation and storage revenues increased from $298 million in fourth-quarter 2017 to $371.5 million in the reported quarter. The rise was mainly due to considerable growth of energy-storage deployments.
Services and other revenues increased 84.4% year over year to $531.2 million.
Tesla’s fourth-quarter 2018 automotive gross margin was 24.3%, increasing 540 basis points (bps) from fourth-quarter 2017.
Energy generation and storage gross margin increased 604 bps on a year-over-year basis to 11.5%.
Tesla, Inc. Price, Consensus and EPS Surprise
Tesla, Inc. Price, Consensus and EPS Surprise | Tesla, Inc. Quote
2018 Results
For 2018, Tesla registered loss per share of $1.33, narrower than loss of $8.66 per share in 2017.
Revenues for 2018 were $18.5 billion, up from $9.6 billion in 2017.
Financial Position
Tesla had cash and cash equivalents of $3.69 billion as of Dec 31, 2018, compared with $3.37 billion, as of Dec 31, 2017.
Net cash provided by operating activities amounted to $1.23 billion in fourth-quarter 2018 compared with net cash of $509.9 million in fourth-quarter 2017. Capital expenditure declined to $325 million from $786.7 million in the year-ago quarter.
Business Expansion
In fourth-quarter 2018, Tesla opened 27 stores and service locations. The company also opened 69 supercharger locations, reaching the global total of 1,421.
Model 3 Update
By mid-2018, Tesla became successful in stabilizing Model 3 production in high volumes. Model 3 turned out to be the best-selling premium vehicle (including SUVs) in the United States in 2018 with around 140,000 units sold.
In fact, the Model 3 production rate rose considerably through fourth-quarter 2018. December 2018 recorded the highest volume in terms of Model 3 production. Moreover, expenses per vehicle continued to decline. Labor time required per Model 3 declined by roughly 20% in fourth-quarter 2018 from that of third-quarter 2018.
Outlook
Tesla anticipates Model 3 volumes in 2019 to grow substantially over 2018 due to high production rates at the Fremont facility. The Model 3 production at this facility is expected to reach a sustained rate of 7,000 units per week by the end of 2019. Including the production at Gigafactory Shanghai, the company targets to manufacture 10,000 vehicles per week on a sustained basis.
Again, Energy generation and storage revenues are likely to increase considerably due to the storage business. Further, the Services and Other business is set to grow in 2019 on account of projected used-car sales volume.
Zacks Rank & Stocks to Consider
Tesla currently carries a Zacks Rank #3 (Hold).
A few better-ranked stocks in the auto space are Dana Incorporated (DAN - Free Report) , Allison Transmission Holdings, Inc. (ALSN - Free Report) and General Motors Company (GM - Free Report) . While Dana currently sports a Zacks Rank #1 (Strong Buy), both Allison Transmission and General Motors has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Dana has an expected long-term growth rate of 2.9%. Over the past three months, shares of the company have risen 14.5%.
Allison Transmission has an expected long-term growth rate of 10%. Over the past three months, shares of the company have surged 10.8%.
General Motors has an expected long-term growth rate of 8.5%. Over the three months, shares of the company have risen 6.8%.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
See the pot trades we're targeting>>