Bernstein sees orders as ‘most critical’ to Tesla stock

Going forward, Bernstein believes orders are most critical to Tesla’s stock. Strong orders will point to the opportunity to potentially raise price – while weak orders will point to a need to reduce price further, pressuring margins, and potentially calling into question the bull thesis of strong share and margins over time. The firm acknowledges that Tesla appears to have created demand elasticity, sentiment seems to be improving and the company’s forthcoming analyst day on March 1 could be a further positive catalyst. That said, Bernstein believes consensus numbers have not been reset sufficiently and there is still further downside from Tesla’s demand struggles. It also worries that the setup could be even more challenging in 2024, when Tesla will target selling 2.5M-3M cars with largely its same lineup. The firm has an Underperform rating on the shares with a price target of $150.