2023-10-19 14:50:16
(BFM Bourse) – The electric vehicle specialist published results below expectations and its general director adopted a less than engaging tone during the conference with analysts. The stock collapses on Wall Street.
Tesla finds itself under high tension on Wall Street. The action of the electric vehicle specialist plunged 8.7% to $221.36 at the start of the session, a drop which erases between $70 and $80 billion in market capitalization for the group.
The market is punishing the company’s third quarter results and Elon Musk’s less than encouraging comments during the conference that followed.
In the July-September period, Tesla reported revenue of $23.35 billion, up 9%, unusually weak growth for the company.
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However, this is not such a big surprise given that the automobile company’s deliveries had stalled in the third quarter at 435,059 units, down compared to the previous quarter (466,000) and up “only” 26% per year. compared to the same period of 2022. It should be remembered that Tesla normally shows growth in its deliveries of 30% to 50% over one year.
The modernization of production sites led to downtime in factories which weighed on production and therefore on deliveries.
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A margin further from that of Renault
The group, which has repeatedly reduced the prices of its models in Europe, the United States and China this year, has also logically seen its operating margin collapse. This margin increased from 17.2% in the third quarter of 2022 to 7.6% a year later, profitability comparable to that of Renault (the diamond group forecasts a margin of between 7% and 8% this year).
Earnings per share stood at 66 cents, down 37%, while free cash flow stood at 850 million euros.
According to a consensus cited by Bank of America, Tesla disappointed across the board, with analysts expecting earnings per share of 74 cents, revenue of $23.92 billion and cash flow of $2.4 billion, or well more than the cash that the group actually generated.
Tesla confirmed its medium-term objective of achieving an average annual growth rate for its deliveries of 50%, and reiterated its target for this year at 1.8 million vehicles.
A conference that was a “mini-catastrophe”
But these rather disappointing results are not the only reason pushing investors to sell the stock. In reality, when Tesla published its accounts on Wednesday evening, the group’s action rose slightly in post-closing trading, before turning around during the conference with analysts organized by management, with CEO Elon Musk .
“In summary, we would describe yesterday’s (Wednesday) evening’s conference call as a ‘mini-catastrophe’, as the markets wanted to know regarding the decline in margins and the constant price reductions observed around the world, but they rather heard a much more cautious Musk” on the economic situation, explains Dan Ives, analyst at Wedbush on X (ex-Twitter).
“Elon Musk has devoted much of his time to the macroeconomic environment and the effects of current interest rates,” observes Bank of America. “Given these risks, Tesla is slowing down plans to build the next manufacturing plant in Mexico,” it added.
That confirms Archyde.com, the agency reports that the manager has placed great emphasis on the impact of interest rates, fearing that these high rates will prevent potential customers from purchasing his automobiles, even if the prices are lower.
The Cybertruck will take time to take off
“People are hesitant to buy a new car if the economy is uncertain,” Elon Musk said during the conference with analysts, during which he also discussed the pressures American workers are experiencing “from salary to salary. the other”. “I don’t want to rush into uncertainty,” he added.
Another important element: Tesla announced that the first delivery of the Cybertruck, a sort of pick-up with a polygonal design with angular lines (reminiscent of car racing video games at the time of the beginnings of 3D on console), would take place. on November 30.
“Management provided more details on the Cybertruck production plan, which is expected to reach desired operating volume (250,000 units) and profitability in 2025,” notes Bank of America.
Julien Marion – ©2023 BFM Bourse
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