Investors will be keeping a close eye on Tesla ‘s second-quarter results due postmarket Tuesday amid an intensely competitive electric vehicle market. Analysts expect Tesla to post 62 cents in earnings per share on $24.77 billion in revenue. Although the revenue estimate is slightly higher than the $21.30 billion Tesla posted in the first quarter, the earnings forecast is 30% below the previous year. Last quarter, Tesla reported adjusted earnings of 45 cents per share on a 9% decline in revenue to $21.30 billion compared with the fourth quarter. Tesla released second-quarter delivery numbers in June, its closest approximation to sales. Shares rallied on better-than-expected second quarter deliveries , but later sold off after CEO Elon Musk said Tesla would push back the debut of its Robotaxi. Tesla is now little changed on the year. TSLA YTD mountain Tesla shares in 2024 With the delay of the Robotaxi, the upcoming earnings are a “significantly more actionable near-term catalyst,” Guggenheim analyst Ronald Jewsikow wrote in a note earlier this month. Guggenheim rates Tesla a sell with a 12-month price target of $134, implying the shares will plunge more than 46% from Monday’s close. “If the schedule for a physical prototype or securing some form of credible end market testing is slipping, how can investors gain confidence in the promises of a Robotaxi future? We continue to believe Robotaxis at scale will be a 2030 and beyond event,” Jewsikow added. Other analysts also believe that the fundamental business outlook for Tesla remains cloudy. “2Q stands to force investors to at least consider still-challenged fundamentals, and we see risk of stock reversion to the extent results disappoint,” Barclays analyst Dan Levy wrote. “Indeed, 2Q may reaffirm continued pressure on margins, even if they are near a trough.” Levy rates Tesla equal weight. Despite the excitement surrounding Tesla’s pivot toward autopilot vehicles and artificial intelligence, Levy believes it’s unclear how long this momentum can drive the stock — and said weak, near-term sales volumes create “considerable uncertainty.” Evercore’s Chris McNally also sees further downside to Tesla shares. The delay of the Robotaxi to October from early August has slowed momentum, according to McNally. The second quarter “does not look any easier,” McNally said, as “demand/production continues to flatline and has essentially been the same 425–445k for seven straight quarters now, with [the] expectation that Q3 will be similar.” The analyst has an in line rating and $145 price target on Tesla, suggesting 42% potential downside from Monday’s close. The rally that propelled Tesla shares in June and July was simply “retail puppy love” on the part of individual investors, according to Wells Fargo analyst Colin Langan. In addition to weak fundamentals, Langan highlighted new U.S. and EU tariffs on electric vehicle batteries as a headwind for Tesla. Investors thus far have “ignored the impact” of the tariffs, according to Langan, who forecasts they will raise costs by $570 million in 2024 and $1.2 billion in 2025. The U.S. presidential election also poses a headwind — the analyst forecasts a Trump win as a risk to Tesla, given his plans to curb President Joe Biden’s Inflation Reduction Act. To be sure, several analysts are bullish on Tesla. Morgan Stanley’s Adam Jonas, for example, carries an overweight rating on shares. Tesla is starting to receive recognition as more than just a car company, and as a broader AI play, according to Jonas. “Investors are starting to consider the potential for Tesla to be an expression on the AI theme. But recent indicators of climate change are bringing even greater attention to Tesla’s dominant position in energy storage,” Jonas said in a note this month. Jonas holds a $310 price target on Tesla shares, indicating 23% potential upside from Monday’s close. —CNBC’s Michael Bloom contributed to this report.
