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Zacks Rank #2 (Buy) stock Tesla ((TSLA - Free Report) ) has been on a rollercoaster ride. The stock doubled off the 2022 panic lows and has traded in a wide, volatile range since. Tesla, the leading EV maker, is expected to report fourth-quarter earnings after the close tomorrow, Wednesday, January 24th. Below are the essential items investors should know and look out for heading into earnings:
Potential Magnitude of Move
The options implied move for an earnings report represents the market’s expectation of the potential percentage price change in a stock following the earnings release. It is derived from the pricing of options contracts and reflects investor anticipation of volatility. Tesla Implied Move: +/- 6.8%
Wall Street Expectations
Regarding earnings reports, no metric is more important than a company’s performance versus Wall Street’s expectations. The Zacks Consensus Estimates takes the sum of several analysts on Wall Street to come up with a consensus number that analysts expect. For the current quarter, Zacks Consensus Estimates expect EPS of $0.74 (-37.82%) versus the prior year.
Image Source: Zacks Investment Research
Will Oversold Levels Prove to Be a Prudent Buy Area Again?
The % Williams R indicator is a momentum oscillator used in technical analysis to assess whether a stock is overbought or oversold. It measures the relative position of the current closing price in relation to the high and low prices over 14 days. The indicator is expressed as a percentage and ranges from 0 to -100. Readings near -100 represent heavily oversold zones and have coincided with significant lows in Tesla in recent years. Will the oversold reading prove to be yet another buy-the-dip opportunity?
Image Source: TradingView
What Does Management Have to Say About Pricing Cuts?
Pricing cuts have put pressure on TSLA over the past few months. Charlie Bilello points out, “The average price of a used Tesla has declined 18 months in a row, moving from a record high of $67,900 in July 2022 to a record low of $35,844 today.”
Image Source: Zacks Investment Research
Cybertruck Update
Tesla began deliveries of the highly anticipated (and delayed) Cybertruck. Wall Street will be anxious to see how the deliveries are progressing.
How is China’s Economy Impacting the Company?
China is going through one of its worst bear markets and economies ever. Nevertheless, Tesla has largely weathered the storm. Yesterday, reports surfaced that China will stimulate its stock market. Because China is a vast EV market, investors will be listening to see what management has to say on the state of the Chinese market.
Will there be an Update on Musk Voting Share?
Tesla CEO Elon Musk has long voiced his fears about the progression of AI. In a recent tweet, Musk warned that he would not move forward with Tesla’s AI ambitions unless he had a 25% voting share in the company (he currently has ~12.5%)
Solar Update
Investors often forget that Tesla acquired SolarCity years ago. With interest rates rising, solar stocks have been in the gutter. Does Musk see the solar business nearing a trough?
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Tesla Earnings Preview: What to Watch For
Zacks Rank #2 (Buy) stock Tesla ((TSLA - Free Report) ) has been on a rollercoaster ride. The stock doubled off the 2022 panic lows and has traded in a wide, volatile range since. Tesla, the leading EV maker, is expected to report fourth-quarter earnings after the close tomorrow, Wednesday, January 24th. Below are the essential items investors should know and look out for heading into earnings:
Potential Magnitude of Move
The options implied move for an earnings report represents the market’s expectation of the potential percentage price change in a stock following the earnings release. It is derived from the pricing of options contracts and reflects investor anticipation of volatility. Tesla Implied Move: +/- 6.8%
Wall Street Expectations
Regarding earnings reports, no metric is more important than a company’s performance versus Wall Street’s expectations. The Zacks Consensus Estimates takes the sum of several analysts on Wall Street to come up with a consensus number that analysts expect. For the current quarter, Zacks Consensus Estimates expect EPS of $0.74 (-37.82%) versus the prior year.
Image Source: Zacks Investment Research
Will Oversold Levels Prove to Be a Prudent Buy Area Again?
The % Williams R indicator is a momentum oscillator used in technical analysis to assess whether a stock is overbought or oversold. It measures the relative position of the current closing price in relation to the high and low prices over 14 days. The indicator is expressed as a percentage and ranges from 0 to -100. Readings near -100 represent heavily oversold zones and have coincided with significant lows in Tesla in recent years. Will the oversold reading prove to be yet another buy-the-dip opportunity?
Image Source: TradingView
What Does Management Have to Say About Pricing Cuts?
Pricing cuts have put pressure on TSLA over the past few months. Charlie Bilello points out, “The average price of a used Tesla has declined 18 months in a row, moving from a record high of $67,900 in July 2022 to a record low of $35,844 today.”
Image Source: Zacks Investment Research
Cybertruck Update
Tesla began deliveries of the highly anticipated (and delayed) Cybertruck. Wall Street will be anxious to see how the deliveries are progressing.
How is China’s Economy Impacting the Company?
China is going through one of its worst bear markets and economies ever. Nevertheless, Tesla has largely weathered the storm. Yesterday, reports surfaced that China will stimulate its stock market. Because China is a vast EV market, investors will be listening to see what management has to say on the state of the Chinese market.
Will there be an Update on Musk Voting Share?
Tesla CEO Elon Musk has long voiced his fears about the progression of AI. In a recent tweet, Musk warned that he would not move forward with Tesla’s AI ambitions unless he had a 25% voting share in the company (he currently has ~12.5%)
Solar Update
Investors often forget that Tesla acquired SolarCity years ago. With interest rates rising, solar stocks have been in the gutter. Does Musk see the solar business nearing a trough?