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Tesla (TSLA) Outpaces Stock Market Gains: What You Should Know

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Tesla (TSLA - Free Report) closed at $451.50 in the latest trading session, marking a +1.92% move from the prior day. This move outpaced the S&P 500's daily gain of 0.35%. Elsewhere, the Dow gained 0.24%, while the tech-heavy Nasdaq added 0.56%.

Prior to today's trading, shares of the electric car maker had gained 34.1% over the past month. This has outpaced the Auto-Tires-Trucks sector's gain of 4.24% and the S&P 500's gain of 4.69% in that time.

TSLA will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $1.29, down 33.16% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $6.97 billion, down 3.59% from the year-ago period.

Investors might also notice recent changes to analyst estimates for TSLA. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. TSLA is currently sporting a Zacks Rank of #2 (Buy).

In terms of valuation, TSLA is currently trading at a Forward P/E ratio of 76.95. This valuation marks a premium compared to its industry's average Forward P/E of 12.83.

It is also worth noting that TSLA currently has a PEG ratio of 2.2. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Automotive - Domestic stocks are, on average, holding a PEG ratio of 1.39 based on yesterday's closing prices.

The Automotive - Domestic industry is part of the Auto-Tires-Trucks sector. This group has a Zacks Industry Rank of 79, putting it in the top 31% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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