Tesla's stock price has risen for ten consecutive days! However, it has been mocked by bond king as a 'internet celebrity stock'. Will it continue to be strong in the future?

Gelonghui Finance ·  Jul 10 17:22

Source: Gelonghui

US stocks closed on Tuesday.$Tesla (TSLA.US)$It rose 3.71% to $262.33, and the total market capitalization reached $836.6 billion.

This is the 10th consecutive trading day that the stock has risen, with a cumulative increase of 43.68% during this period.

Looking back at the first half of this year, Tesla's stock price performance has not been ideal. Since the beginning of the year, the stock price has been falling all the way down, falling to the lowest point in the year on April 22, then entering a continuous fluctuation range, so much so that it still fell more than 28% at the end of the first half of the year.

However, the recent surge made up for previous losses. As of July 9, Tesla's annual increase was 5.57%.

Being mocked by the debtor king as an “influencer stock”

Overall, the reason for this surge is mainly because Tesla's latest delivery data was better than expected, which indicates that the company's electric vehicle business is starting to improve.

Delivery data released by Tesla on July 2 showed that the company delivered a total of 0.444 million new vehicles in the second quarter. Despite a 4.8% year-on-year decline, it exceeded market expectations of 0.4393 million vehicles.

Oppenheimer analyst Colin Rush wrote on Tuesday: “As car sales resume (quarterly) and the company reduces channel inventory, we see Tesla implementing key elements to keep the business healthy.”

However, he remains cautious about the stock. He said that people who are optimistic about Tesla may point out that the company's energy storage sales are strong, sales are expected to exceed 3 billion US dollars this quarter, and that the Model 3 and Model 2 upgrades may help Tesla resume growth in the automotive industry.

However, he believes that bears will attack Tesla's profit margins and the problem that its fully automated driving function is unprofitable.

Toni Sacconaghi, an analyst at investment bank Bernstein, is bearish. He pointed out that Tesla clearly benefited from better-than-expected delivery in the second quarter, but it is worth noting that sales in the second quarter fell 5% year over year, while sales in the first quarter fell 9% year over year.

He added that this is a bit like Meme stock. The valuation is out of touch with fundamentals. The current share price assumes a profit of $7 per share, while the general expectation is only $2.

Today, “Old Debt King” Bill Gross said that Tesla “acted like a meme stock (influencer stock) — fundamentals continued to weaken, and prices skyrocketed.” Gross said, “Now it seems like a new influencer stock will appear every other day, and most of them are boosting shipments.”

Still facing tests

Although the latest delivery data exceeded expectations, Tesla is currently facing quite a few tests.

First, demand in the global electric vehicle market is slowing down, particularly in the US and Europe.

In May of this year, Bernstein analysts wrote in a report that after three years of rapid growth, sales in the global electric vehicle market are slowing down. Electric vehicle sales increased 20% year over year in the first quarter, below Bernstein's forecast of 25% growth for the full year of 2024.

Also, according to UBS forecasts, the global electric vehicle market share will drop to 47% from 54% previously by 2030, with electric vehicle sales growth in Europe and the US slowing to 10% to 15%.

Second, the competition Tesla is facing is getting more intense. Research firm Cox Automotive released the latest estimate on Tuesday. In the second quarter of this year, Tesla's share in the US electric vehicle market fell to 49.7%. This is the first time in a quarter that Tesla's share fell below 50%, down nearly 10 percentage points from 59.3% in the same period last year.

In the Chinese market, Tesla's situation is not much better. According to data released by the China Passenger Vehicle Association, in June, Tesla's domestic sales volume was 59,261 vehicles, up 7% from the previous month, but down 20% year on year.

Furthermore,$BYD Company Limited (002594.SZ)$/$BYD COMPANY (01211.HK)$The rise of Chinese brands has also put a lot of pressure on Tesla. Judging from the 2024 June 2024 wholesale sales list of new energy passenger vehicles announced by the Passenger Federation, Tesla ranked second. The first place was BYD, with 340,211 vehicles, while$GEELY AUTO (00175.HK)$,$Chongqing Changan Automobile (000625.SZ)$It followed with 65,959 vehicles and 50,300 vehicles (estimated).

Robotaxi is in the spotlight

In addition to the electric vehicle business, Tesla's autonomous taxi business has also attracted much attention.

Earlier, Musk announced that it will launch driverless taxis (Robotaxi) on August 8. As the launch date nears, market expectations are getting higher.

Garrett Nelson, a senior stock strategist at CFRA Research, pointed out that Wall Street is now focusing on Tesla's autonomous taxis, and Musk has been talking about this fully automated driving service for months and said it could be a “huge driver” for future growth.

Tianfeng Securities believes that FSD and RoboTaxi's corresponding market imagination space is more flexible, a potential inflection point for intelligent driving has emerged, and a low-cost smart driving path gives Tesla the possibility to gain a larger share in the Robotaxi global market. Taken together, under the neutral assumption that Tesla Robotaxi drives 1500 billion kilometers per year (self-operated+license), the Robotaxi business has a neutral revenue space of about 1,335 billion dollars in 2030.

It is worth noting that Tesla will announce its financial results for the fourth quarter of fiscal year 2024 on the 23rd of this month, and hold a performance meeting after the announcement.

Earlier, Brian Rauscher, founder of BFR Research, pointed out that Wall Street's decline in Tesla's profit expectations has clearly slowed, which indicates that market sentiment is stabilizing, and the company's financial performance prospects may improve.


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