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Electric carmaker Tesla Motors (TSLA - Free Report) is scheduled to report first-quarter 2023 results on Apr 19 after market close. Let’s take a closer look at its fundamentals ahead of the earnings release.
Tesla stock has risen about 52% so far this year, outperforming the Zacks industry average growth of 14.2%. The solid trend is likely to continue, given that Tesla has a reasonable chance of beating estimates this quarter (see: all the Alternative Energy ETFs here).
This has put the ETFs having a substantial allocation to this luxury carmaker like MeetKevin Pricing Power ETF (PP - Free Report) , Consumer Discretionary Select Sector SPDR Fund (XLY - Free Report) , ARK Autonomous Technology & Robotics ETF (ARKQ - Free Report) , Vanguard Consumer Discretionary ETF (VCR - Free Report) and Fidelity MSCI Consumer Discretionary Index ETF (FDIS - Free Report) in focus ahead of Q1 earnings.
Earnings Whispers
Tesla has a Zacks Rank #3 (Hold) and an Earnings ESP of +0.19%. According to our methodology, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 increases the chances of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
The electric carmaker saw negative earnings estimate revision of a penny over the past 30 days for the to-be-reported quarter. Analysts decreasing estimates right before earnings — with the most up-to-date information possible — is not a good indicator for the stock. The Zacks Consensus Estimate for the first quarter indicates a substantial year-over-year earnings decline of 20.6% and revenue growth of 25.6%.
However, the earnings track is robust for the company, which delivered a four-quarter average earnings surprise of 23.55%.
Tesla has a top Growth Score of A but belongs to a bottom-ranked Zacks industry (in the bottom 33%). The Zacks Consensus Estimate for the average target price is $220.25, with nearly 546% of the analysts giving a Strong Buy or a Buy rating ahead of the company’s earnings.
Record Q1 Deliveries
Earlier this month, Tesla reported record deliveries for the first quarter fueled by higher demand due to big price cuts across the globe. The company slashed prices globally by as much as 20% in January, unleashing a price war. The basic Model Y, which used to sell for $65,990, now costs $54,990.
The luxury carmaker delivered 422,875 (412,180 Model 3 and Y and 10,695 Model S and X) cars worldwide in the first quarter. This is up 36% from the year-ago quarter and 4% from the prior quarter. The electric carmaker produced a record 440,808 (421,371 Model 3 and Y, and 19,437 Model S and X) vehicles during the quarter (read: Tesla Rolls Out Record Deliveries in Q1: ETFs in Focus).
MeetKevin Pricing Power ETF is an actively managed ETF that seeks to achieve its investment objective by investing primarily in the U.S.-listed equity securities of Innovative Companies that, in Kevin’s view, have more “pricing power” than their peers. The fund holds a small basket of 17 stocks, with Tesla occupying the top position at 24.9%.
MeetKevin Pricing Power ETF newly debuted in the space at the end of November and has accumulated $23.1 million in its asset base. It charges 77 bps in annual fees and trades in a lower volume of 26,000 shares a day on average (read: 5 ETF Areas Up At Least 35% This Year).
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.
Consumer Discretionary Select Sector SPDR Fund is the largest and most popular product in this space, with AUM of $14.3 billion and an average daily volume of around 5.5 million shares. Holding 53 securities in its basket, Tesla takes the second spot with 15.3% 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.
ARK Autonomous Technology & Robotics ETF is an actively managed ETF seeking long-term capital appreciation by investing in companies that benefit from the development of new products or services as well as technological improvement and advancements in scientific research related to energy, automation and manufacturing, materials and transportation. This approach results in a basket of 36 stocks, with Tesla occupying the top spot with a 13.8% share.
ARK Autonomous Technology & Robotics ETF has accumulated $902.9 million in its asset base and charges 75 bps in fees per year. It trades in a volume of 75,000 shares a day on average.
Vanguard Consumer Discretionary ETF currently follows the MSCI US Investable Market Consumer Discretionary 25/50 Index and holds 307 stocks in its basket. Of these, Tesla occupies the second position with a 12.5% allocation. Broadline takes the largest share at 23.8%, while automobile manufacturers, restaurants and home improvement retail round off the next three spots.
Vanguard Consumer Discretionary ETF charges investors 10 bps in annual fees, while volume is moderate at nearly 63,000 shares a day. The product has managed about $4 billion in its asset base and 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 303 stocks in its basket. Of these, TSLA takes the second spot with a 12.5% share.
Fidelity MSCI Consumer Discretionary Index ETF has amassed $1 billion in its asset base while trading in a good volume of around 72,000 shares a day on average. Fidelity MSCI Consumer Discretionary Index ETF charges 8 bps in annual fees from investors and has a Zacks ETF Rank #3 (Hold) with a Medium risk outlook.
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What Lies Ahead for Tesla ETFs in Q1 Earnings?
Electric carmaker Tesla Motors (TSLA - Free Report) is scheduled to report first-quarter 2023 results on Apr 19 after market close. Let’s take a closer look at its fundamentals ahead of the earnings release.
Tesla stock has risen about 52% so far this year, outperforming the Zacks industry average growth of 14.2%. The solid trend is likely to continue, given that Tesla has a reasonable chance of beating estimates this quarter (see: all the Alternative Energy ETFs here).
This has put the ETFs having a substantial allocation to this luxury carmaker like MeetKevin Pricing Power ETF (PP - Free Report) , Consumer Discretionary Select Sector SPDR Fund (XLY - Free Report) , ARK Autonomous Technology & Robotics ETF (ARKQ - Free Report) , Vanguard Consumer Discretionary ETF (VCR - Free Report) and Fidelity MSCI Consumer Discretionary Index ETF (FDIS - Free Report) in focus ahead of Q1 earnings.
Earnings Whispers
Tesla has a Zacks Rank #3 (Hold) and an Earnings ESP of +0.19%. According to our methodology, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 increases the chances of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
The electric carmaker saw negative earnings estimate revision of a penny over the past 30 days for the to-be-reported quarter. Analysts decreasing estimates right before earnings — with the most up-to-date information possible — is not a good indicator for the stock. The Zacks Consensus Estimate for the first quarter indicates a substantial year-over-year earnings decline of 20.6% and revenue growth of 25.6%.
However, the earnings track is robust for the company, which delivered a four-quarter average earnings surprise of 23.55%.
Tesla has a top Growth Score of A but belongs to a bottom-ranked Zacks industry (in the bottom 33%). The Zacks Consensus Estimate for the average target price is $220.25, with nearly 546% of the analysts giving a Strong Buy or a Buy rating ahead of the company’s earnings.
Record Q1 Deliveries
Earlier this month, Tesla reported record deliveries for the first quarter fueled by higher demand due to big price cuts across the globe. The company slashed prices globally by as much as 20% in January, unleashing a price war. The basic Model Y, which used to sell for $65,990, now costs $54,990.
The luxury carmaker delivered 422,875 (412,180 Model 3 and Y and 10,695 Model S and X) cars worldwide in the first quarter. This is up 36% from the year-ago quarter and 4% from the prior quarter. The electric carmaker produced a record 440,808 (421,371 Model 3 and Y, and 19,437 Model S and X) vehicles during the quarter (read: Tesla Rolls Out Record Deliveries in Q1: ETFs in Focus).
ETFs to Watch
MeetKevin Pricing Power ETF (PP - Free Report)
MeetKevin Pricing Power ETF is an actively managed ETF that seeks to achieve its investment objective by investing primarily in the U.S.-listed equity securities of Innovative Companies that, in Kevin’s view, have more “pricing power” than their peers. The fund holds a small basket of 17 stocks, with Tesla occupying the top position at 24.9%.
MeetKevin Pricing Power ETF newly debuted in the space at the end of November and has accumulated $23.1 million in its asset base. It charges 77 bps in annual fees and trades in a lower volume of 26,000 shares a day on average (read: 5 ETF Areas Up At Least 35% This Year).
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.
Consumer Discretionary Select Sector SPDR Fund is the largest and most popular product in this space, with AUM of $14.3 billion and an average daily volume of around 5.5 million shares. Holding 53 securities in its basket, Tesla takes the second spot with 15.3% 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.
ARK Autonomous Technology & Robotics ETF (ARKQ - Free Report)
ARK Autonomous Technology & Robotics ETF is an actively managed ETF seeking long-term capital appreciation by investing in companies that benefit from the development of new products or services as well as technological improvement and advancements in scientific research related to energy, automation and manufacturing, materials and transportation. This approach results in a basket of 36 stocks, with Tesla occupying the top spot with a 13.8% share.
ARK Autonomous Technology & Robotics ETF has accumulated $902.9 million in its asset base and charges 75 bps in fees per year. It trades in a volume of 75,000 shares a day on average.
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 307 stocks in its basket. Of these, Tesla occupies the second position with a 12.5% allocation. Broadline takes the largest share at 23.8%, while automobile manufacturers, restaurants and home improvement retail round off the next three spots.
Vanguard Consumer Discretionary ETF charges investors 10 bps in annual fees, while volume is moderate at nearly 63,000 shares a day. The product has managed about $4 billion in its asset base and 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 303 stocks in its basket. Of these, TSLA takes the second spot with a 12.5% share.
Fidelity MSCI Consumer Discretionary Index ETF has amassed $1 billion in its asset base while trading in a good volume of around 72,000 shares a day on average. Fidelity MSCI Consumer Discretionary Index ETF charges 8 bps in annual fees from investors and has a Zacks ETF Rank #3 (Hold) with a Medium risk outlook.