Tesla’s first-quarter vehicle delivery numbers are due out near the end of the week, likely coming on Saturday, April 2. Deliveries are expected to grow in the first quarter of 2022 compared with the fourth quarter of 2021. That is quite a feat.
Wall Street currently expects first-quarter deliveries to fall between 310,000 and 320,000 units. That is up from about 309,000 vehicles delivered in the fourth quarter of 2021.
An increase of a few thousand units might not sound like much, but amid new Covid-19 restrictions and a persistent parts shortage, an increase will likely be enough to maintain recent momentum in the stock.
Coming into Tuesday trading, Tesla (ticker: TSLA) shares are up 43% from March lows, set right before the Federal Reserve raised short-term interest rates. The rally has left Tesla stock up about 3% year to date, better than the 4% comparable drops of both the S&P 500 and Dow Jones Industrial Average and far better than the 25% and 20% respective drops of General Motors (GM) and Ford Motor (F) shares.
Wedbush analyst Dan Ives wrote Friday that first-quarter deliveries are tracking ahead of Street expectations. “China and Europe in particular are tracking at least 15%+ ahead of Street estimates.”
The Chinese strength might surprise investors. Deliveries at NIO (NIO), XPeng (XPEV), and Li Auto (LI), combined, are expected to fall first quarter compared with the fourth quarter, to about 91,000 vehicles from about 102,000 vehicles.
The Lunar New Year holiday affects first-quarter results, but so do falling purchase incentives for electric vehicles in China. Purchase incentives were cut about 30% to start the year, creating a rush to buy in the final months of 2021.
Well ahead of Street expectations, like Ives points out, might imply that deliveries come in north of 320,000. Ives, who rates Tesla share Buy and has a $1,400 price target, didn’t publish his delivery estimate in his Friday report. RBC analyst Joseph Spak sounds as bullish as Ives and has a number investors can focus on.
Spak wrote on Monday that he expects Tesla to deliver about 325,500 units in the first quarter. That estimate was up from his prior number of roughly 316,000 vehicles, and the increase was based on factors such as “[channel] checks, regionally reported data, and app download data.”
Spak rates Tesla shares Hold and has a $1,045 price target for the stock.
Not everyone is as bullish about deliveries as those two. Credit Suisse analyst Dan Levy believes Tesla will deliver about 307,000 vehicles in the first quarter, down from the fourth-quarter result. Covid-19 “flare ups” in China are partly to blame, according to the analyst. Levy still rates Tesla shares Buy and has a $1,025 price target for Tesla stock.
Overall, almost half of the analysts covering Tesla stock rate shares Buy. The average Buy-rating ratio for stocks in the S&P 500 is about 58%. The average analyst target price is about $928 a share, down about 15% from recent levels.
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