Tesla stock is about to slim down after delivery and JPMorgan downgrade

The Tesla share picks up right where it left off in 2022: Lacking juice.

Shares of the EV maker fell as much as 11% in morning trading on Tuesday, with investors reacting to a weak fourth-quarter delivery figure released on New Year’s Day. Tesla was the most popular ticker on the Yahoo Finance platform.

Tesla saw fourth-quarter deliveries rise 18% sequentially to 405,000, missing consensus forecasts of 418,000. The number brought Tesla’s total 2022 deliveries to 1.3 million units, up 40% year-over-year but below the company’s guidance of 50% .

The delivery miss only fueled further concern on the Street about demand for Tesla̵[ads1]7;s vehicles — a key factor in sending shares 65% lower in 2022.

JPMorgan analyst Ryan Brinkman cut his earnings estimates and price target for Tesla in the wake of the soft results.

Brinkman sees Tesla missing Q4 earnings estimates ($1.19) when it reports later in January. For 2023, Brinkman now models earnings of $4.60 per share, down from $4.84 previously.

Tesla stock is about to slim down after delivery and JPMorgan downgrade

The Tesla store is closed at the King of Prussia Mall on December 11, 2022 in King of Prussia, Pennsylvania (Photo by Mark Makela/Getty Images)

The analyst price target moved down to $125 from $150. He continues to rate the stock underweight (sell equivalent).

“Beyond the impact on near-term financials, another implication we see from 4Q’s combination of softer-than-consensus volume and pricing is the impact on the stock’s growth narrative that has allowed many investors to believe the company is likely to increase unit volume upwards of about a ~+ 50% CAGR [compound annual growth rate] until it is the world’s largest automaker (the management outlook is for “Over a multi-year horizon, we expect to achieve 50% average annual growth in vehicle deliveries”),” Brinkman explained. “We have questioned the company’s ability to sustain this growth.”

Brian Sozzi is editor-in-chief and anchor at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.

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