Source: Zhitong Finance
Tesla will announce its first-quarter 2022 results after the U.S. stock market closes on April 20, Eastern Time (early morning on April 21, Beijing time). Market expectations are for Q1 revenue of $17.78 billion and earnings per share of $2.26. The second-quarter production guidance for the Shanghai factory, which has been affected by the coronavirus lockdown, will be in focus, as the factory is responsible for almost half of Tesla’s capacity.
Zhitong Finance APP learned that Tesla’s Shanghai plant resumed work on the 19th of this month, and about 8,000 employees have now arrived. The plant will be produced in a closed-loop management mode, and the export of complete vehicles and parts will gradually resume.
Any surprise in Shanghai factory production could reset expectations across Wall Street. Ahead of Tesla’s earnings report, analysts at Wall Street investment banks have had their say.
Wedbush Securities analyst Dan Ives has a “buy” rating on Tesla. “Considering the shutdown over the past three weeks, vehicle production in the June quarter was down roughly 50,000 vehicles, which could be further impacted next month depending on how aggressively Tesla resumes production,” Ives said. Tesla Inc. It’s a tough situation because there are so many variables in Chinese production in the second quarter that will definitely weigh on guidance for the rest of the year, so the stock has come under pressure over the past month.”
Evercore ISI analyst Chris McNally has an “equal to market” rating on Tesla. Tesla’s second-quarter production guidance and management comments will likely be more important than the first-quarter results, McNally said, as the Shanghai plant shut down for three weeks and the weekly shutdowns cost production losses of 16-18,000 units. Revenue decreased by $80-$100 million, EBIT decreased by $24-$35 million, and EPS decreased by 18-23 cents. Potential new catalysts include the restart of production in China and legislation related to the previous Build America Better Act, which planned to increase the federal tax credit limit for electric vehicles.
Credit Suisse analyst Dan Levy raised his price target on Tesla to $1,125 from $1,025 and maintained an “outperform” rating on the stock. Analysts pointed to the pace of restarts at factories in Shanghai and output fluctuations at plants in Berlin, Germany and Austin, U.S., adding to uncertainty about deliveries in 2022. Profit margins remain the focus of the market amid rising costs.
Deutsche Bank analyst Emmanuel Rosner has a “buy” rating on Tesla. Given the logistical problems at the Shanghai port, the cars produced at the Shanghai plant in April are likely to be used more to fulfill domestic orders, Rosner said. Chip shortages still pose a near-term risk to production, Rosner said, but Tesla has demonstrated its ability to manage its supply chain better than its peers, which will also be reflected in first-quarter production numbers.
In addition to the automotive business, market analysts will also focus on Tesla’s energy storage business . “We believe that recent geopolitical events are accelerating the grid/industrial/household level stationary storage market,” said Morgan Stanley analyst Adam Jonas. Any guidance or commentary on energy storage systems is likely to be an understatement. Value adjustment opens up a new avenue.
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