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Tesla (TSLA) Up 6% Since Last Earnings Report: Can It Continue?
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It has been about a month since the last earnings report for Tesla (TSLA - Free Report) . Shares have added about 6% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Tesla due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Tesla Puts Up a Stellar Q4 Show
Tesla reported earnings per share of $2.14 in fourth-quarter 2019, beating the Zacks Consensus Estimate of $1.62. This outperformance stemmed from higher-than-expected automotive revenues, which came in at $6.37 billion, beating the consensus mark of $5.96 billion. The earnings figure also came in higher than the prior-year quarter’s $1.93 per share.
During the reported quarter, net income attributable to common shareholders amounted to $105 million compared with the net income of $140 million recorded in the year-ago quarter.
Revenues increased to $7.38 billion from the $7.22 billion registered in fourth-quarter 2018. Also, the revenue figure surpassed the Zacks Consensus Estimate of $7.05 billion.
During the fourth quarter, Tesla reported record delivery of 112,095 vehicles.
Total automotive revenues, including that from automotive sales and leasing, inched up 1% year over year to $6.37 billion in the quarter.
Energy generation and storage revenues increased from $372 million in fourth-quarter 2018 to $436 million in the reported quarter. Services and other revenues were up 9.23% year over year to $580 million.
Tesla’s fourth-quarter 2019 automotive gross margin was 22.5%, shrinking 179 basis points (bps) from fourth-quarter 2018.
Financial Position
Tesla had cash and cash equivalents of $6.3 billion as of Dec 31, 2019, compared with $3.69 billion as of Dec 31, 2018, driven by positive quarterly free cash flow of $1 billion.
Net cash provided by operating activities amounted to $1.43 million in fourth-quarter 2019 compared with $1.24 billion of net cash used in fourth-quarter 2018. Capital expenditure increased to $412 million from the year-ago quarter’s $325 million, mainly due to investments in Gigafactory Shanghai and Model Y preparations in Fremont.
Model 3 & S/X Update
In fourth-quarter 2019, Tesla reported Model 3 production and deliveries of 86,958 and 92,620 units, reflecting year-over-year increase from 61,394 and 63,359 units, respectively. During the quarter, the production rate of Model 3 continued to improve.
Model S/X production and deliveries totaled 17,933 and 19,475 vehicles, down 29% year over year.
Outlook
Tesla is making efforts to improve vehicle deliveries, sequentially and annually, with some expected fluctuations from seasonality. For full-year 2020, the company expects vehicle deliveries to exceed 500,000 units. Due to ramp-up of Model 3 in Shanghai and Model Y in Fremont, production will likely outpace deliveries this year. Both solar and storage deployments will be up at least 50% in 2020.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in estimates revision. The consensus estimate has shifted -105.58% due to these changes.
VGM Scores
Currently, Tesla has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. Following the exact same course, the stock was allocated a grade of F on the value side, putting it in the bottom 20% quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Tesla has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Tesla (TSLA) Up 6% Since Last Earnings Report: Can It Continue?
It has been about a month since the last earnings report for Tesla (TSLA - Free Report) . Shares have added about 6% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Tesla due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Tesla Puts Up a Stellar Q4 Show
Tesla reported earnings per share of $2.14 in fourth-quarter 2019, beating the Zacks Consensus Estimate of $1.62. This outperformance stemmed from higher-than-expected automotive revenues, which came in at $6.37 billion, beating the consensus mark of $5.96 billion. The earnings figure also came in higher than the prior-year quarter’s $1.93 per share.
During the reported quarter, net income attributable to common shareholders amounted to $105 million compared with the net income of $140 million recorded in the year-ago quarter.
Revenues increased to $7.38 billion from the $7.22 billion registered in fourth-quarter 2018. Also, the revenue figure surpassed the Zacks Consensus Estimate of $7.05 billion.
During the fourth quarter, Tesla reported record delivery of 112,095 vehicles.
Total automotive revenues, including that from automotive sales and leasing, inched up 1% year over year to $6.37 billion in the quarter.
Energy generation and storage revenues increased from $372 million in fourth-quarter 2018 to $436 million in the reported quarter. Services and other revenues were up 9.23% year over year to $580 million.
Tesla’s fourth-quarter 2019 automotive gross margin was 22.5%, shrinking 179 basis points (bps) from fourth-quarter 2018.
Financial Position
Tesla had cash and cash equivalents of $6.3 billion as of Dec 31, 2019, compared with $3.69 billion as of Dec 31, 2018, driven by positive quarterly free cash flow of $1 billion.
Net cash provided by operating activities amounted to $1.43 million in fourth-quarter 2019 compared with $1.24 billion of net cash used in fourth-quarter 2018. Capital expenditure increased to $412 million from the year-ago quarter’s $325 million, mainly due to investments in Gigafactory Shanghai and Model Y preparations in Fremont.
Model 3 & S/X Update
In fourth-quarter 2019, Tesla reported Model 3 production and deliveries of 86,958 and 92,620 units, reflecting year-over-year increase from 61,394 and 63,359 units, respectively. During the quarter, the production rate of Model 3 continued to improve.
Model S/X production and deliveries totaled 17,933 and 19,475 vehicles, down 29% year over year.
Outlook
Tesla is making efforts to improve vehicle deliveries, sequentially and annually, with some expected fluctuations from seasonality. For full-year 2020, the company expects vehicle deliveries to exceed 500,000 units. Due to ramp-up of Model 3 in Shanghai and Model Y in Fremont, production will likely outpace deliveries this year. Both solar and storage deployments will be up at least 50% in 2020.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in estimates revision. The consensus estimate has shifted -105.58% due to these changes.
VGM Scores
Currently, Tesla has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. Following the exact same course, the stock was allocated a grade of F on the value side, putting it in the bottom 20% quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Tesla has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.