ABNB - Why Is Tesla Going Higher? Here's What You Need To Know About Q2 Deliveries

2024-07-02 12:40:26 ET

Summary

• Tesla, Inc. outperformed Q2 delivery expectations, shipping 443,956 vehicles during the June quarter compared to consensus estimates of about 430,000 vehicles.
• Despite the second consecutive quarter of delivery declines, the latest outperformance complements investors' returning optimism for Tesla's FSD and robotaxi prospects.
• The upcoming robotaxi unveiling event on August 8 will likely mark an inflection for the stock, with immediate investors' focus dwelling on Model 2 launch details.
• The event's timeline will also coincide with the Delaware judge's anticipated final decision over Elon Musk's 2018 pay package, which will likely drive further volatility to the stock.

Tesla, Inc. ( TSLA ) has handily beat expectations on 2Q24 deliveries , albeit a low bar set after repeatedly lowered consensus estimates. The company delivered 443,956 vehicles during the June quarter, which represented a -5% y/y decline and 15% sequential expansion. The results compared to the average Wall Street delivery estimate of about 430,000 vehicles, and were well within expectations that Tesla was in for its second consecutive quarter of delivery declines for the first time. The results also conclude a modest first half of the year for Tesla in terms of automotive sales, which effectively puts the company’s auto unit sales growth prospects for the year – as previously promised with confidence by CEO Elon Musk – at greater risk. The stock’s response to Tesla’s 2Q24 delivery results was also favorable.

This is corroborative of returning investors’ interest towards Tesla’s full self-driving ("FSD") and robotaxi realization prospects. Recall from our previous coverage’s discussion that Tesla’s stock valuation has long decoupled from vehicle sales. And this decoupling has become especially clear in recent quarters, with auto sales underperformance in 1Q24 overshadowed by investors’ optimism in the robotaxi unveiling event coming August 8....

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