The Tesla stock falls when the electric car manufacturer throws “curve balls” at bulls

Late Wednesday, Tesla reported fourth-quarter earnings well above the Wall Street consensus, and stocks traded down immediately after the release when the company revealed that their factories had been under capacity for several months due to supply chain problems.

However, the stock turned the course as CEO Elon Musk tried to allay these production concerns, saying he sees production growth “pleasantly”[ads1]; above 50% in 2022.

However, he kept light on short-term issues, and spent much of the time-plus conference call talking about driverless Teslas, which he promised at the end of this year, a potential fleet of robotic axes, and the Tesla humanoid robot unveiled. in August.

About 12 hours after the results, some analysts were bored by the lack of details.

The results threw some “curveballs” at the Tesla bulls, Jeffrey Osborne at Cowen said in a note Thursday. Musk’s’ ‘rant’ on (Full Self Driving) brings back flashbacks to ’19 when 1 million robot axes were promised by YE20, “he said.

Tesla shares “tend to work best when something new comes along,” Osborne said. Meaningful production of the new vehicles, such as the Cybertrucken and the commercial electric truck, is pushed to 2023, and there is no “Model 2”, a cheaper electric car around $ 25,000 in development, he said.

Investors had high expectations that Tesla would discuss the product’s roadmap over the next year plus, said analyst John Murphy with B. from A. Securities in his note. Instead, the outlook for 2022 and beyond was “relatively vague.”

Tesla’s guidance for production growth was “encouraging”, but somewhat confusing as Tesla continued to emphasize that supply chain challenges remained a limitation, Murphy said.

“In addition, we anticipated that (Tesla) within the 2022 outlook could provide more details about production start and expected ramp timeline at the Austin and Berlin facilities, but little definitive guidance was given other than the current status of both factories, which was disappointing.”

Others had a more optimistic view. Tesla’s “long-term history is intact,” Adam Jonas told Morgan Stanley. Tesla is on its way to being a company with ten factories that will produce as many as 1 million vehicles per factory by 2030, he said.

The conversation strengthened Tesla’s focus on scale as it increases capacity at its five factories, said Ben Kallo at Baird.

Musk highlighted “several technological advances,” he said. “Although these have been discussed previously, the comment seemed to indicate that some were closer to commercialization than before. We remain buyers.”

While Tesla reiterated “optimism” about its complete self-driving driverless system, analyst Mark Delaney at Goldman Sachs said he and his colleagues are still “guarded on
how quickly the company can achieve full autonomy given the delays the industry
wide (including Tesla) has met historically on (autonomous vehicles). ”

The lack of progress on a $ 25,000 EV could raise questions about Tesla’s growth next year, as other electric cars around that price hit the market, Delaney said. For now, however, Tesla can count on “significant growth going forward with its current models,” he said.

Tesla’s results were “strong, but not a blowout,” said Toni Sacconaghi with Bernstein in his note. “Elon Musk’s long-awaited product update was a bit of a disappointment,” he said.

And despite Tesla executives’ emphasis on FSD, full self-driving has “and will likely continue to take longer to deliver than Tesla thinks, due to technical and legal reasons,” Sacconaghi said.

Tesla shares have outperformed the broader index over the past 12 months, with the stock now down 0.8% compared to a rise of around 17% for the S&P 500 index SPX,
-0.54%
over that time.