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Should You Buy Tesla-Heavy ETFs Despite Weak Q3 Deliveries?
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Tesla delivered 343,830 electric vehicles in the third quarter, missing analysts’ expectations of 359,162 deliveries, according to Refinitiv, as quoted on Business Standard. A year earlier Tesla delivered 241,300 units. Logistics challenges were held responsible for this miss.
In Q2 also, the company reported weak deliveries on supply chain issues. Tesla had delivered 254,695 (238,533 Model 3 and Y, and 16,162 Model S and X) cars worldwide in the second quarter, snapping a two-year streak of quarter-on-quarter gains. This is down from 310,048 deliveries in the prior quarter but up 26.5% from the year-ago quarter when Tesla delivered 201,304 vehicles.
Should You Buy Tesla?
"Historically, our delivery volumes have skewed towards the end of each quarter due to regional batch building of cars," Tesla said in a statement. "As our production volumes continue to grow, it is becoming increasingly challenging to secure vehicle transportation capacity and at a reasonable cost during these peak logistics weeks," said Tesla.
Since there has not been any drag on production volume, investors can count on Tesla. Tesla is now targeting ‘steadier’ deliveries intra-quarter. Tesla had said that its delivery count is conservative and that final numbers could vary by 0.5% or more, per a Bloomberg article. The company produced 365,923 vehicles for the quarter. Tesla has a Zacks Rank #3 (Hold) and Growth and Momentum Score of A.
ETFs to Tap
If investors are still wary about Tesla, they can bet on Tesla-heavy ETFs. After all, a basket approach minimizes the company-specific risks.
Consumer Discretionary Select Sector SPDR Fund (XLY - Free Report)
Consumer Discretionary Select Sector SPDR Fund offers exposure to the broad consumer discretionary space by tracking the Consumer Discretionary Select Sector Index. Holding about 60 securities in its basket, Tesla takes the second spot with 21.5% of assets. Consumer Discretionary Select Sector SPDR Fund charges 10 bps in annual fees and has a Zacks ETF Rank #1 (Strong Buy) with a Medium risk outlook.
Vanguard Consumer Discretionary ETF currently follows the MSCI US Investable Market Consumer Discretionary 25/50 Index and holds 324 stocks in its basket. Of these, Tesla occupies the second position with a 15% allocation. VCR carries a Zacks ETF Rank #1 with a Medium risk outlook.
Fidelity MSCI Consumer Discretionary Index ETF (FDIS - Free Report)
Fidelity MSCI Consumer Discretionary Index ETF tracks the MSCI USA IMI Consumer Discretionary Index, holding 324 stocks in its basket. Of these, TSLA takes the second spot with a 17% share. Fidelity MSCI Consumer Discretionary Index ETF has a Zacks ETF Rank #1 with a Medium risk outlook.
Simplify Volt Robocar Disruption and Tech ETF (VCAR - Free Report)
The Simplify Volt RoboCar Disruption and Tech ETF seeks to concentrate in those few disruptive companies poised to dominate autonomous driving and then enhance the concentrated exposures with options. Simplify Volt Robocar Disruption and Tech ETF invests about 7.2% in Tesla. Tesla takes the third spot in the fund.
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Should You Buy Tesla-Heavy ETFs Despite Weak Q3 Deliveries?
Tesla delivered 343,830 electric vehicles in the third quarter, missing analysts’ expectations of 359,162 deliveries, according to Refinitiv, as quoted on Business Standard. A year earlier Tesla delivered 241,300 units. Logistics challenges were held responsible for this miss.
In Q2 also, the company reported weak deliveries on supply chain issues. Tesla had delivered 254,695 (238,533 Model 3 and Y, and 16,162 Model S and X) cars worldwide in the second quarter, snapping a two-year streak of quarter-on-quarter gains. This is down from 310,048 deliveries in the prior quarter but up 26.5% from the year-ago quarter when Tesla delivered 201,304 vehicles.
Should You Buy Tesla?
"Historically, our delivery volumes have skewed towards the end of each quarter due to regional batch building of cars," Tesla said in a statement. "As our production volumes continue to grow, it is becoming increasingly challenging to secure vehicle transportation capacity and at a reasonable cost during these peak logistics weeks," said Tesla.
Since there has not been any drag on production volume, investors can count on Tesla. Tesla is now targeting ‘steadier’ deliveries intra-quarter. Tesla had said that its delivery count is conservative and that final numbers could vary by 0.5% or more, per a Bloomberg article. The company produced 365,923 vehicles for the quarter. Tesla has a Zacks Rank #3 (Hold) and Growth and Momentum Score of A.
ETFs to Tap
If investors are still wary about Tesla, they can bet on Tesla-heavy ETFs. After all, a basket approach minimizes the company-specific risks.
Consumer Discretionary Select Sector SPDR Fund (XLY - Free Report)
Consumer Discretionary Select Sector SPDR Fund offers exposure to the broad consumer discretionary space by tracking the Consumer Discretionary Select Sector Index. Holding about 60 securities in its basket, Tesla takes the second spot with 21.5% of assets. Consumer Discretionary Select Sector SPDR Fund charges 10 bps in annual fees and has a Zacks ETF Rank #1 (Strong Buy) with a Medium risk outlook.
Vanguard Consumer Discretionary ETF (VCR - Free Report)
Vanguard Consumer Discretionary ETF currently follows the MSCI US Investable Market Consumer Discretionary 25/50 Index and holds 324 stocks in its basket. Of these, Tesla occupies the second position with a 15% allocation. VCR carries a Zacks ETF Rank #1 with a Medium risk outlook.
Fidelity MSCI Consumer Discretionary Index ETF (FDIS - Free Report)
Fidelity MSCI Consumer Discretionary Index ETF tracks the MSCI USA IMI Consumer Discretionary Index, holding 324 stocks in its basket. Of these, TSLA takes the second spot with a 17% share. Fidelity MSCI Consumer Discretionary Index ETF has a Zacks ETF Rank #1 with a Medium risk outlook.
Simplify Volt Robocar Disruption and Tech ETF (VCAR - Free Report)
The Simplify Volt RoboCar Disruption and Tech ETF seeks to concentrate in those few disruptive companies poised to dominate autonomous driving and then enhance the concentrated exposures with options. Simplify Volt Robocar Disruption and Tech ETF invests about 7.2% in Tesla. Tesla takes the third spot in the fund.