https://www.marketwatch.com/story/weak-tesla-deliveries-already-priced-in-analyst-says-2019-03-28...from analysts at Baird, known bulls on Tesla which has been hit lately with mostly negative Wall Street takes about its first-quarter deliveries numbers, expected next week.
“We are buyers into the release as we believe weak deliveries are priced into the stock and think the report could be a de-risking event,” the analysts, led by Ben Kallo, said in a note Thursday. They expect Model 3 deliveries to hit 50,000, slightly below market expectations.
...
Analysts polled by FactSet expect Tesla to deliver 77,000 vehicles in the first quarter, including 55,000 Model 3 sedans. Concerns have swirled that demand for Tesla vehicles are lagging and margins dwindling.
https://thefly.com/landingPageNews.php?id=2884968Negative sentiment on Tesla into Q1 'looks excessive,' says Jefferies "We can't deny some nervousness about Q1 results," Jefferies analyst Philippe Houchois tells investors in a research note on Tesla titled "Testing demand elasticity in Q1." The analyst has a Buy rating on the shares with a $450 price target. Tesla closed yesterday at $267.77. With the stock back to pre-second half of 2018 profit levels and near the $250 support level, negativity on the name into Q1 "looks excessive," contends Houchois. For Q1, he expects an EBIT loss of $50M, negative free cash flow of $350M-$400M due to inventory and transit outflow, and $3B in gross cash. He also expects 52,000 Model 3 deliveries in the quarter. The analyst keeps his estimates for the year unchanged. Tesla continues to lead towards increasingly affordable battery electric vehicles, but it is too early to gauge demand elasticity as pay-back from the end of federal credits is still being digested, says the analyst.
Updating my earlier post:
Summary of Model 3 delivery estimates:
RBC: 25000 US/NA, 21000 EU, 6500 China, 52500 Total.
Cowen: 47500 Total.
Walter MacVane: 20800 EU, 20800 China.
Alphahat: 30000+ US/NA, 19000 EU, 19000 China.
Anton Wahlman: 23760 US/NA, Europe 14031, China 3300, 41091 Total.
Anton Wahlman updated: 26360 US/NA, Europe 18283 China 3300, 47943 Total.
Tim Chowdhry: 30000 Total.
Tesla guidance: >51400 Total.
Consensus analysts: 55000 Total.
Baird: 50000 Total.
Jeffries: 52000 Total.
I get the feeling that bullish analysts (Chowdhry, Baird, Jeffries) and Tesla are downplaying expectations in order to generate a positive "surprise". Shorts (Wahlman, Cowen, RBC) are giving low numbers as well, while enthusiasts (MacVane, Alphahat, others on the web) are expecting much higher numbers.
I personally expect around 60k Model 3 deliveries. I can't believe 8 ships to China totalled less than 10-12k M3 delivered, and I think US/NA saw lots of the $37k SR+ deliveries in the last month. Also with production capacity of around 80k per quarter, I believe they produced at least 70k and will not be stuck with 20k cars in transit. I guess that makes me a current bull (and for full disclosure I am indeed long TSLA at the moment).
Forget about the hype and the stock volatility -
this is the real Tesla glory/failure:
* Is there enough actual demand at current price points? (Lots of people on the web wishing for a Tesla does not necessarily translate into dollars).
* Can the company actually execute on production, shipping and delivery of the cars to satisfy this demand? At a profit?
I believe 50k Model 3 deliveries is a failure showing the company is hitting hard limits to its growth. 55k is very lukewarm. 60k is a success (and far-fetched 65k-70k if it happens is a huge success).
I also wouldn't be surprised if the company manages a profit during the quarter despite guiding a small loss. A two-week sale of software features (AP, FSD) that got a good uptake, less store closures than initially planned, and possibly sale of ZEV credits could contribute.
