Tesla Q1 Earnings Preview

After inaugurating two new factories, attention is now on how Tesla can supply the materials needed as global logistic issues persist.

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Deliveries already known

The main issue for Tesla has been and continues to be fulfilling orders. Most recently, it was reported that Tesla is sold out for the rest of the year in their main market. We already got Q1 deliveries, which came in just above expectations at 310K. The most recent issue relating to that, which was the pause in the Shanghai factory due to covid, happened after the end of the quarter.

So, with the main issues already resolved, the Tesla results in of themselves are unlikely to have as much market-moving potential. That is unless something unexpected is added in, which once upon a time was the comments from CEO Musk, but he has recently backed off participating in as many conference calls.

What to look out for

Tesla is forecast to report earnings of $2.26/share on $17.7B in sales. The late March opening of the Berlin factory implies that it is unlikely to have contributed to the sales figures. And given the delivery data is already out, it pretty much means the revenue figure is pretty well known (although deliveries can have some minor adjustments with the quarterly report).

The bottom line for Tesla is "flexible" since the company does try to register a profit. But how much depends mostly on the investments that management choose to make. So, variations in EPS don't necessarily represent the final profitability of the company, as it needs to build out new facilities to meet demand.

Traditionally Tesla gets asked questions through the Stay app, and then responds to the most popular ones. Right now, the most popular questions include whether or not there will be a stock split, how Tesla plans to secure raw materials, and what new construction projects are planned.

TESLA: Back into a bull market

TSLA has printed significant gains since February 24 as bulls gathered enough momentum to turn the stock from being in a bear market (down 20%) to a bull market (Up 20%).

Above the 100-day average of $970, the share price could be sent towards $1150; the April 5th high, and even to all-time highs above $1250.

Should the 100-day support break, the 50 and 200-day equivalents come in as next levels of possible support at $930 and $890 respectively. A break of the 200-day MA could change sentiment significantly, especially after failing to make a new ATH.

Source: Spreadex trading platform

Key Takeaways

Tesla has had to deal with fulfilling orders and the Shanghai factory pause but despite that, it is selling out for the rest of the year. The release is unlikely to have a big market impact regardless as Q1 is generally irrelevant unless something unexpected happens.

Although investors should be more optimistic about the new factories it is unlikely to be shown in the Q1 report. So, they should focus on comments around a possible stock split, plans for new factories, and solving logistic issues.