By a mile
In the latest example of how unpredictable stock movement can be following earnings, Tesla (TSLA) widely missed the mark late Tuesday, but its stock initially shook off the matter and eventually took off. Shares advanced 5.4% to $250 in post-market trading as CEO Elon Musk took the mic during a conference call, and drove as high as 7% in the premarket this morning. For those focused on guidance, things didn’t appear any better on that front. The company admitted that “rapidly evolving trade policy” and “changing political sentiment” could have a meaningful impact on demand in the near term, while it pulled its outlook for 2025.
So, what happened? Despite the dismal report, there was messaging that traders bought into, along with a bold vision from Elon. He has recently spent much of his time in Washington heading up the Department of Government Efficiency, but starting early next month, Musk will only be allocating a day or two per week to DOGE. “The future of the company is fundamentally based on large-scale autonomous cars,” Elon added, as well as “large-scale, large-volume, vast numbers of autonomous humanoid robots.” It’s a needed transition as cheaper Chinese rivals significantly eat into its EV market share, though Tesla does plan affordable vehicle production early this year and things to stabilize in the medium to long term. Read the full earnings call transcript
Will he or won’t he? Elon Musk surely has an impressive resume, with most of his companies pioneering big industry breakthroughs. Investors liked to hear him double down on Tesla’s mission of revolutionizing the world through robotaxis and robots, while analysts who believe in that vision are banking their price targets on that reality. “If we do execute well, I think Tesla will be the most valuable company in the world by far,” Musk declared. “It may be as valuable as the next five companies combined.” The statements helped recharge the stock, which has fallen 40% YTD, even if that meant shrugging off the actual numbers displayed in the latest results. See Tesla earnings in four charts
From the SA comments section: “Tesla can’t make an operating profit without tax credits on the higher value vehicles so how are they going to make money selling a lower priced car?,” asks SA Premium user Managing, while SPDY84 writes that “any other stock would be down 20% on this type of report vs valuation… not TSLA.” Elon Musk is the “genius of our time,” counters SA Investing Group subscriber Iamnorthcoast. “Everyone is so caught up in disliking Tesla. Let the haters hate. It might not be pretty now but it will be everlasting successful.”
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