Despite Tesla (TSLA) announcing record delivery numbers for Q3, investors were not impressed with the update, and sent shares down at Monday’s open.
The EV maker delivered 343,830 units, a 35% uptick vs. the 254,695 units delivered in the second quarter, and 42% higher than 3Q21’s showing of 241,300 units.
Total production increased by 42% from the 258,580 units produced in 2Q22 to reach 365,923 units, 54% above the 237,823 units produced in the same period last year.
However, the delivery figure fell short of Wall Street’s expectations for 358,000, hence the disappointment amongst investors.
Looking at the numbers, Canaccord’s George Gianarikas notes that the gap between the production figures and actual deliveries amounts to the “largest absolute gap since over the last 3-plus years and the fourth largest on a percentage basis (as a % of production).”
So, why exactly has this happened? There appear to be two schools of thought here.
The message from Tesla’s end is that the gap between production and deliveries is down to “logistical issues related to end of the quarter deliveries, which are accentuated by the company’s rising volumes.”
Not all will be buying into that explanation, however. As an increasing number of data points both from a macro and “Tesla-specific perspective” indicate a “potential slowdown” in order rates, Gianarikas thinks some may opt to “take a glass-half empty view of this gap and deem that it can be attributed to an end of quarter demand slowdown.”
What does Gianarikas think? The analyst comes down on the EV leader’s side. “We trust Tesla’s explanation of the gap, particularly with growing production in Berlin and Austin,” the analyst said. “As we have articulated, a potential demand slowdown will manifest itself in slowing orders, an unreported metric which will likely be discussed on the company’s earnings call.”
While Gianarikas has made some adjustments to his estimates, his Buy rating stays as is and so does the $304 price target, which makes room for 12-month gains of 23%. (To watch Gianarikas’ track record, click here)
Vafi’s objective is just a touch under the Street’s average target, which stands at $307.62 and suggests shares will climb 24% higher in the year ahead. Overall, based on 18 Buys, 6 Holds and 5 Sells, the stock claims a Moderate Buy consensus rating. (See Tesla stock forecast on TipRanks)
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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.