2024 could bring these catalysts for Tesla
In 2024, Tesla is expected to have multiple catalysts, including the release of new models, advancements in autonomous driving technology, plans to build a factory in India, a rebound in profit margins, market response to the Cybertruck electric pickup, showcasing the potential of the Optimus robot at the AI Day event, and overall advantages in artificial intelligence. Tesla's market value is expected to surpass the combined market value of Toyota, Stellantis, Ferrari, Honda, General Motors, and Ford Motor. In the Chinese market, Tesla faces fierce competition, while in the United States, General Motors and Ford Motor have been slow in their transition to electric vehicles. Since 2023, Tesla has seen a growth of over 105%, making it a leader in the automotive manufacturing industry.
According to Zhitong App, as we enter early 2024, Tesla's market value is expected to surpass the combined market value of Toyota (TM.US), Stellantis (STLA.US), Ferrari (RACE.US), Honda (HMC.US), General Motors (GM.US), and Ford Motor (F.US).
Tesla's Q3 2023 earnings report, released in October, showed a revenue of $23.35 billion, a YoY growth of 9%, but lower than the market's expectation of $24.06 billion. Under the non-GAAP accounting standards, the net profit attributable to common stockholders was $2.318 billion, a YoY decrease of 37%, falling short of the market's expectation of $2.56 billion. Diluted earnings per share were $0.66, lower than the market's expectation of $0.74.
In addition, Tesla's production volume was 430,488 vehicles, an 18% YoY increase. The delivery volume in Q3 was 435,059 vehicles, a 27% YoY increase, but lower than the record-breaking 466,140 vehicles in Q2, marking the first QoQ decline in a year and 20,000 vehicles below market expectations.
Tesla is facing increasingly fierce competition in the Chinese market. In the United States, General Motors and Ford Motor have been slow in transitioning to electric vehicles, while Lucid Group (LCID.US) and Fisker (FSR.US) have recently lowered their production expectations for 2023. Rivian (RIVN.US) has shown faster growth compared to other electric vehicle startups, but it is not yet a direct competitor to Tesla.
The bull and bear battle over Tesla may continue for another year. In addition to increasing production at its Gigafactories, potential catalysts for Tesla in the coming year include the release of the next model, progress in Full Self-Driving (FSD) technology, plans to build a factory in India, a strong rebound in profit margins, market response to the electric pickup truck Cybertruck, an AI day showcasing the potential of the Optimus robot, and Tesla's overall advantage in artificial intelligence.
As of last Friday's close, Tesla's stock has risen over 105% since the beginning of 2023, making it a leader in the automotive manufacturing industry. Tesla's stock is trading above the 50-day, 100-day, and 200-day moving averages, with a relative strength index above 50.
Wall Street analysts have mixed views on Tesla's performance in 2024. Among the 42 analysts who have rated Tesla, 15 have given a rating equivalent to "buy" or higher, 21 have given a rating equivalent to "hold," and 6 have given a rating equivalent to "sell."Some investors hold a more optimistic attitude towards Tesla. They believe that strong factors such as profitability, growth, and momentum offset the adverse impact of valuation. They point out that Tesla is in a favorable position in building its service business, and its revenue indicators also show a strong compound annual growth rate due to its excellent product line.