Tesla Has an Annual Meeting Thursday, There's a Lot to Watch For

Tesla's huge base of retail investors always like to hear from management and CEO Elon Musk. They get another chance to on Thursday.

Tesla hosts its 2022 annual meeting of shareholders Thursday, starting at 5:30 p.m. ET; it can be streamed from the company's website.

Investors and analysts will be looking to hear about production, demand, and pricing.

Tesla said it produced a record number of vehicles in June, and the company is ramping up production at its new plants in Germany and Texas. How those ramps are going and how Tesla is dealing with supply-chain issues -- such as delays caused by Covid-19 lockdowns in China and a shortage of semiconductors -- are important for investors.

Regarding demand, Musk has said repeatedly that Tesla can sell all the vehicles it can make. In addition, he has also said that lead times to purchase a Tesla -- which can stretch to 8 months or 9 months depending on the model ordered -- are too long. Investors would like an update about lead times and ordering patterns, given rising prices and rising interest rates.

Prices might not rise for much longer, however. Musk recently tweeted that commodity prices are falling. That could presage a pricing peak, or even a price cut. Investors would like to know the direction of pricing heading into 2023. Bears will likely argue any price cuts signal weak demand, while bulls might predict that falling prices will boost sales and ordering rates.

Along price, production and demand, investors will be on the lookout for any clues about Tesla's next plant or product.

Tesla, when fully ramped up, can probably produce 2.1 million units annually from its four plants with room to expand to, perhaps, 2.4 million units with incremental improvements. Wall Street expects Tesla to deliver about 2.1 million vehicles in 2023. The company wants to grow production volumes at 50% a year on average for the foreseeable future. There might have to be another plant, or a significant expansion of an existing facility, by the middle of next year.

At the meeting, Tesla investors will also vote to authorize more shares outstanding. The vote will pave the way for a 3:1 stock split. That proposal should pass easily. Investors tend to like stock splits, believing they signal management's optimism about the future, among other things.

Annual meetings can be dry affairs, but Tesla's tend to be a little more interesting. Tesla stock is heavily owned among retail investors. That tends to make shareholder engagement -- at events such as analyst conference calls and annual meetings -- higher than other firms. Tesla, for instance, takes calls from investors along with Wall Street analysts each quarter. That isn't typical.

Tesla stock is down about 13% year to date. That's better than the 20% comparable decline of the Nasdaq Composite and similar to the 14% decline of the S&P 500.