Shares Gain After Topping Delivery Estimates
Tesla stock received a major boost on Friday after the EV business said it delivered 184,800 vehicles and produced 180,338 cars for the quarter to end-March. This is much higher than the average of 168,000 EV deliveries expected from the surveyed analysts.
This way, the EV company topped the Q1 deliveries of 180,570 reported in Q4 2020. Compared to a year-ago period, Tesla’s Q1 deliveries represent an increase of about 100%. Last year, the EV business delivered 499,550 cars.
“We are encouraged by the strong reception of the Model Y in China and are quickly progressing to full production capacity,” the EV business said in a statement on Friday.
Interestingly, Elon Musk’s business said that all produced electric vehicles were Model 3 sedans and Model Y crossover SUVs. The EV company didn’t produce any Model S sedans and Model X SUVs in the prior quarter. Still, the company delivered 2,020 Model S and Model X electric vehicles from its inventories, representing only 1% of its total deliveries.
“We have been able to bring forward the Plaid Model S and X – Model S will be delivered in February and Model X a little later. The Model S Plaid, we’re actually in production now,” CEO Elon Musk said in January.
Zachary Kirkhorn, the Chief Financial Officer (CFO) of the business, said earlier this year that S and X production would be low “due to the transition to the newly re-architected products.”
“Specifically for Q1, our volumes will have the benefit of early Model Y ramp in Shanghai.”
Tesla stock also received a major boost this morning as prominent Wall Street analyst Daniel Ives, a managing director at Wedbush, upgraded the stock rating to “Outperform” from “Neutral.” A new price target for Tesla stock from Wedbush is $1,000.00 per share from the prior $950.00.
"In our opinion the 1Q delivery numbers released on Friday was a paradigm changer and shows that the pent-up demand globally for Tesla's Model 3/Y is hitting its next stage of growth as part of a global green tidal wave underway," Ives wrote in a note sent to clients on Sunday.
According to Ives, the EV business could now surpass 850,000 deliveries in 2021 with 900,000 “a stretch goal.” The analyst also took note of the “eye-popping” delivery numbers from China.
Analyst Jeffrey Osborne was also impressed by Tesla’s Q1 delivery numbers, which hint the EV company is not suffering a major impact from the global semiconductor shortage. As a result, the analyst raised Model Y forecasts for 2021.
Tesla stock closed just a bit over 1% lower in March to trade almost 30% lower compared to the all-time high set in January. A March low of $539.49 is the lowest Tesla stock traded since November. Shares are trading at $711.80 in pre-open Monday.
Tesla stock has moved higher today after the EV company reported stronger-than-expected Q1 deliveries prompting the Wall Street analyst to upgrade the stock.
About the Author
Mariliana has an MSC in consumer analytics and business strategy. She has a special interest in fast-moving industries and big data.