We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Everybody has quickly become familiar with Tesla (TSLA - Free Report) over the recent years, the undisputed leader in the EV industry.
And, of course, Tesla shares have long been big outperformers, up more than 5000% over the last decade and rewarding shareholders handsomely.
However, Tesla shares struggled in 2022, losing more than 65% in value and putting a screeching halt to a stellar run. This is shown in the chart below.
Image Source: Zacks Investment Research
A hawkish Federal Reserve, soaring input costs, and lingering COVID-19 disruptions have plagued the stock, crushing any positive sentiment.
It raises a valid question: how does the EV titan currently stack up? Let’s take a closer look.
Upcoming Q4
In early January, Tesla reported its Q4 deliveries. Of course, this is always the metric most closely watched, as it tells us how many EVs the company was able to place in the hands of its customers.
Tesla delivered roughly 405,000 EVs throughout Q4, representing yet again another quarter of record deliveries.
However, the market wasn’t impressed. Why? The reported figure fell short of estimates, sending shares spiraling downward. Our consensus estimate stood at 407,855.
Tesla’s Q4 results come after the market close on January 25th. Currently, the Zacks Consensus EPS Estimate of $1.14 suggests an improvement of more than 30% Y/Y.
Over the last 60 days, the quarterly estimate has moved roughly 6% lower.
Image Source: Zacks Investment Research
Regarding the company’s top line, our consensus revenue estimate of $24.8 billion indicates an increase of roughly 40% Y/Y. Below is a chart illustrating the company’s revenue on a quarterly basis.
Image Source: Zacks Investment Research
Growth Outlook & Valuation
Despite the headwinds faced, Tesla still maintains a strong growth trajectory; earnings are forecasted to climb 77% in its current fiscal year (FY22) and a further 22% in FY23.
The projected earnings growth comes on the back of forecasted Y/Y revenue upticks of 52% in FY22 and 35% in FY23.
In addition, the company’s valuation multiples have pulled back extensively; currently, Tesla shares trade at a 3.4X forward price-to-sales ratio, nearly half its 6.5X five-year median and a fraction of 2022 highs of 23.4X.
The company carries a Style Score of a “C” for Value.
Image Source: Zacks Investment Research
Bottom Line
After embarking on a monumental run over the last decade, the music was shut off for Tesla (TSLA - Free Report) shares in 2022, with a harsh macroeconomic backdrop playing spoilsport all year.
Whispers of softening EV demand and a recent delivery miss have also fueled the fire sale.
However, on the flip side, the company boasts a strong growth trajectory, and valuation multiples have cratered following the adverse price action.
Still, the company is currently a Zacks Rank #4 (Sell), indicating that its earnings outlook has drifted lower over the last several months.
For those interested in the stock, remaining patient until positive earnings estimate revisions start rolling in would be a good starting point.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Checking In on Tesla Shares
Everybody has quickly become familiar with Tesla (TSLA - Free Report) over the recent years, the undisputed leader in the EV industry.
And, of course, Tesla shares have long been big outperformers, up more than 5000% over the last decade and rewarding shareholders handsomely.
However, Tesla shares struggled in 2022, losing more than 65% in value and putting a screeching halt to a stellar run. This is shown in the chart below.
Image Source: Zacks Investment Research
A hawkish Federal Reserve, soaring input costs, and lingering COVID-19 disruptions have plagued the stock, crushing any positive sentiment.
It raises a valid question: how does the EV titan currently stack up? Let’s take a closer look.
Upcoming Q4
In early January, Tesla reported its Q4 deliveries. Of course, this is always the metric most closely watched, as it tells us how many EVs the company was able to place in the hands of its customers.
Tesla delivered roughly 405,000 EVs throughout Q4, representing yet again another quarter of record deliveries.
However, the market wasn’t impressed. Why? The reported figure fell short of estimates, sending shares spiraling downward. Our consensus estimate stood at 407,855.
Tesla’s Q4 results come after the market close on January 25th. Currently, the Zacks Consensus EPS Estimate of $1.14 suggests an improvement of more than 30% Y/Y.
Over the last 60 days, the quarterly estimate has moved roughly 6% lower.
Image Source: Zacks Investment Research
Regarding the company’s top line, our consensus revenue estimate of $24.8 billion indicates an increase of roughly 40% Y/Y. Below is a chart illustrating the company’s revenue on a quarterly basis.
Image Source: Zacks Investment Research
Growth Outlook & Valuation
Despite the headwinds faced, Tesla still maintains a strong growth trajectory; earnings are forecasted to climb 77% in its current fiscal year (FY22) and a further 22% in FY23.
The projected earnings growth comes on the back of forecasted Y/Y revenue upticks of 52% in FY22 and 35% in FY23.
In addition, the company’s valuation multiples have pulled back extensively; currently, Tesla shares trade at a 3.4X forward price-to-sales ratio, nearly half its 6.5X five-year median and a fraction of 2022 highs of 23.4X.
The company carries a Style Score of a “C” for Value.
Image Source: Zacks Investment Research
Bottom Line
After embarking on a monumental run over the last decade, the music was shut off for Tesla (TSLA - Free Report) shares in 2022, with a harsh macroeconomic backdrop playing spoilsport all year.
Whispers of softening EV demand and a recent delivery miss have also fueled the fire sale.
However, on the flip side, the company boasts a strong growth trajectory, and valuation multiples have cratered following the adverse price action.
Still, the company is currently a Zacks Rank #4 (Sell), indicating that its earnings outlook has drifted lower over the last several months.
For those interested in the stock, remaining patient until positive earnings estimate revisions start rolling in would be a good starting point.