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2023-10-31

Why do people not believe Elon? When he said don't buy anything for the next 18 months, while he was actively selling his Tesla shares, why not believe him? When he said exactly what the company's focus would be in 3 secret plans, why doesn't a single analyst take the time to read these documents? Read them, especially the most recent, and you'll see that the company has no interest in what it's share price does, in share price movement, or ever paying a dividend. In previous plans the focus was on disrupting the global ICE car markets. They'll continue reducing prices to force other manufacturers to do the same, to force price parity with similar sizes ICE vehicles. It's not about sales for Tesla, it's about using EV competitors to disrupt an industry. In plan 3 vehicle sales

Tesla: Expecting Shares Down To Double-Digits By End Of 2024

2023-10-21

Today the kids and I went for a walk and we played a game of spot- the-EVs. 11 Teslas, a Nissan Leaf which barely qualifies as a real car, and a Toyota which shouldn't have been on the list because it's a hybrid but we felt sorry for them. My bet is that, BYD excluded, all of these companies will be bankrupt by the end of 2025. Tesla will survive.

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When he said don't buy anything for the next 18 months, while he was actively selling his Tesla shares, why not believe him? When he said exactly what the company's focus would be in 3 secret plans, why doesn't a single analyst take the time to read these documents? Read them, especially the most recent, and you'll see that the company has no interest in what it's share price does, in share price movement, or ever paying a dividend. In previous plans the focus was on disrupting the global ICE car markets.&nbsp; They'll continue reducing prices to force other manufacturers to do the same, to force price parity with similar sizes ICE vehicles. It's not about sales for Tesla, it's about using EV competitors to disrupt an industry.&nbsp; In plan 3 vehicle sales","listText":"Why do people not believe Elon? When he said don't buy anything for the next 18 months, while he was actively selling his Tesla shares, why not believe him? When he said exactly what the company's focus would be in 3 secret plans, why doesn't a single analyst take the time to read these documents? Read them, especially the most recent, and you'll see that the company has no interest in what it's share price does, in share price movement, or ever paying a dividend. In previous plans the focus was on disrupting the global ICE car markets.&nbsp; They'll continue reducing prices to force other manufacturers to do the same, to force price parity with similar sizes ICE vehicles. It's not about sales for Tesla, it's about using EV competitors to disrupt an industry.&nbsp; In plan 3 vehicle sales","text":"Why do people not believe Elon? When he said don't buy anything for the next 18 months, while he was actively selling his Tesla shares, why not believe him? When he said exactly what the company's focus would be in 3 secret plans, why doesn't a single analyst take the time to read these documents? Read them, especially the most recent, and you'll see that the company has no interest in what it's share price does, in share price movement, or ever paying a dividend. In previous plans the focus was on disrupting the global ICE car markets. They'll continue reducing prices to force other manufacturers to do the same, to force price parity with similar sizes ICE vehicles. It's not about sales for Tesla, it's about using EV competitors to disrupt an industry. In plan 3 vehicle sales","images":[],"top":1,"highlighted":1,"essential":2,"paper":1,"likeSize":9,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/236252839121112","repostId":"2379587283","repostType":2,"repost":{"id":"2379587283","kind":"highlight","pubTimestamp":1698708985,"share":"https://ttm.financial/m/news/2379587283?lang=&edition=fundamental","pubTime":"2023-10-31 07:36","market":"us","language":"en","title":"Tesla: Expecting Shares Down To Double-Digits By End Of 2024","url":"https://stock-news.laohu8.com/highlight/detail?id=2379587283","media":"seekingalpha","summary":"Tesla, Inc. Q3 results fell short of expectations, with revenue growth below double digits and operating margins continuing to compress.The cautious tone during the conference call highlighted potenti","content":"<html><head></head><body><ul style=\"\"><li><p>Tesla, Inc. Q3 results fell short of expectations, with revenue growth below double digits and operating margins continuing to compress.</p></li><li><p>The cautious tone during the conference call highlighted potential headwinds, particularly around the Cybertruck launch and volume ramp-up.</p></li><li><p>Despite ambitions to diversify revenue streams, Tesla remains predominantly an automotive company, and its valuation should reflect this.</p></li><li><p>In line with my assumptions for Tesla, I calculate a fair implied value of $96/share.</p></li></ul><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/f269ab09a8f74eb124f6af73c3786a69\" tg-width=\"750\" tg-height=\"507\"/></p><p>Tesla, Inc. (NASDAQ:TSLA) has delivered a very disappointing September quarter, missing consensus expectations on both revenue growth and profitability. While a quarterly consensus miss should not be a major headwind for most companies, the miss will likely be a major negative catalyst for Tesla. This is because for a long time, Tesla investors expected the electric vehicle (&#34;EV&#34;) company to grow steadily, and aggressively, while maintaining higher margins than &#34;legacy car companies.&#34; Moreover, investors have trusted Elon Musk to manage the company with few missteps, taking an unconventional approach to product commercialization and marketing. These factors contributed to Tesla&#39;s eyewatering valuation, with shares trading at a 500% EV/Sales premium to competitors.</p><p>However, with Tesla&#39;s growth falling below 10% year-over-year, and with operating profitability converging with margins of &#34;legacy car companies,&#34; the Tesla story is ripe for an aggressive review. Furthermore, Elon Musk&#39;s misstep with the Cybertruck highlights the vulnerability of overly ambitious, and unconventional, management decisions.</p><h2 id=\"id_810197368\">Tesla&#39;s Q3 Reporting Shocks Investors</h2><p>Tesla reported results for the 2023 Q3 period on October, 17th, and shocked investors with a broadly unsatisfactory performance. This led to a share price drop of more than 16% in less than 5 days, while the S&amp;P 500 (SP500) managed to keep losses around 3%.</p><p></p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/ffda870e3c2963dee33e30b2113b8cba\" tg-width=\"640\" tg-height=\"236\"/></p><p>Seeking Alpha</p><p></p><p>The numbers telling the story justify the selloff: during the 3 months leading up to the end of September, Tesla generated revenues of 23.4 billion, up only 9% year over year. Tesla&#39;s core business, automotive sales, performed even worse -- the segment only recorded a revenue growth of 5% year over year. Although analysts were already quite bearish going into Q3, consensus still expected Tesla&#39;s revenues to be about $1 billion higher.</p><p>In Q3, Tesla also suffered a major profitability headwind. During the period, the company&#39;s gross margin dropped by more than 700 basis points, to 17.9%. This drop in margins may be attributed to both reduced cost absorption on lower production and pricing pressures. Operating expenses also exceeded expectations, up 43% year over year, bringing operating margin down by 964 basis points, to 7.6%. With margins under pressure, Tesla revealed lower than expected earnings per share of 66 cents, falling short of both consensus estimates of 72 cents. Now, investors should consider that the EPS would have been even worse, if not mitigated by some one-time positive factors like interest income, tax benefits, and regulatory credits, which contributed about 7-8 cents to Tesla&#39;s results.</p><p></p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/3d04bce4218e0f7e4535249c37fd7bbb\" tg-width=\"640\" tg-height=\"320\"/></p><p>Tesla Q3 reporting</p><p></p><h2 id=\"id_1334617368\">Cautious Conference Call Tone Further Underscores Challenges</h2><p>Tesla&#39;s third-quarter results not only fell below what analysts expected, but also triggered a cautious tone during the conference call. In fact, the Q3 call was one of the most negative Tesla calls that I have followed since the company&#39;s IPO. On one hand, Tesla&#39;s CEO, Elon Musk, and the management team were particularly cautious about the macroeconomic factors like rising interest rates, consumer strength, and affordability. This makes sense considering the price-tag of Tesla cars and the still ongoing hard vs. soft landing debate. On the other hand, Tesla management was also quite negative on some idiosyncratic success factors, most notably the Cybercrook and Tesla&#39;s broader volume ramp up going into 2024.</p><p>Relating to the Cybertruck, CEO Elon Musk made a strong effort to manage expectations regarding their highly anticipated launch, hinting at negative impacts on margins and cash flow due to the Cybertruck over the next 18 months.</p><blockquote><p><em>I mean, we dug our own grave with Cybertruck ... Cybertruck’s one of those special products that comes along only once in a long while. And special products that come along once in a long while are just incredibly difficult to bring to market, to reach volume, to be prosperous.</em></p><p><em>I do want to emphasize that there will be enormous challenges in reaching volume production with the Cybertruck, and then in making a Cybertruck cash flow positive ... [it will take] a year to 18 months before it is a significant positive cash flow contributor.</em></p></blockquote><p>So, it is clear that Tesla expects the Cybertruck, their major product launch in the coming years, to affect profit margins and free cash flow negatively. In my opinion, investors should not be too surprised about this. But what does surprise is the steady state volume target of the product. While there&#39;s been a lot of hype with over 1,000,000 orders, reasonable expectations have skewed toward more bullish scenarios, with some investors anticipating over 500,000 units annually. This fantasy was crushed by Elon Musk&#39;s comment that volume may be closer to 250,000.</p><blockquote><p><em>I think we’ll end up with roughly a 0.25 million Cybertrucks a year, I don’t think we’re going to reach that output rate next year. I think we’ll probably reach it sometime in 2025. That’s my best guess.</em></p></blockquote><p>Another significant cause for concern, in my opinion, was the commentary regarding the company&#39;s future production volume. While Tesla reaffirmed its 1.8 million unit target for the year, and announced deliveries for its Cybertruck, scheduled for November 30, the company&#39;s statements about production in Shanghai, Austin, and Berlin signaled volume headwinds: Tesla indicated that Shanghai&#39;s production would not see a substantial increase in Q4, and the ramp-up in Austin and Berlin would be gradual. The company attributed this gradual ramp-up to various challenges to production processes. But in my opinion, it may also hint at weaker demand, specifically in China, where the macro backdrop is challenged and competition against local rivals such as XPeng (XPEV), NIO (NIO), and BYD Company (OTCPK:BYDDF) is rising.</p><p>This commentary suggests that expectations for Tesla&#39;s 2024 deliveries should be more cautious. In fact, a year ago, before analysts were aware of any forthcoming price cuts, Bloomberg&#39;s consensus estimate for Tesla&#39;s 2023 vehicle deliveries was about 2.05 million. Now, even after the price reductions, the current consensus estimate for 2023 stands at 1.81 million. So, contrary to expectations, Tesla&#39;s decision to implement price reductions of 15-20% across its entire product range hasn&#39;t led to increased vehicle sales. Instead, these price cuts were highly likely necessitated by weaker-than-expected demand.</p><h2 id=\"id_2042484236\">The Tesla Story Is Cracking</h2><p>Referencing Tesla&#39;s ~70x EV/EBIT valuation, there are quite a few assumptions that investors imply for the stock to justify the trading multiple. First and foremost, Tesla must be growing ~30% CAGR until 2025, followed by low double-digit growth rates thereafter through at least 2035. Moreover, Tesla&#39;s operating margin at the end of the growth cycle must be between somewhere around ~12-14%. Only with these assumptions would Tesla achieve a ~$48-52 billion EBIT by 2035, which benchmarked against the company&#39;s $650 billion enterprise value, would suggest an EV/EBIT that is in line with the automotive industry median. Otherwise, the math simply does not add up.</p><p>If an investor believes the above assumptions, then Tesla&#39;s valuation at ~70x EV/EBIT is justified. The argument I am making is that long-time investors simply accepted the growth and margin story so long as Tesla delivered numbers to support the thesis. With Q3, however, Tesla failed to deliver numbers that support the above made assumptions. And with this, a rerating is in the cards.</p><p></p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/db0b8144c3e964c32c8fcfebe520edf6\" tg-width=\"640\" tg-height=\"553\"/></p><p>Seeking Alpha</p><p></p><p>With Tesla&#39;s top line growth slowing to below double-digit in Q3 2023 already, the geometric average of ~15% CAGR through 2035 looks increasingly unreasonable (consider that high CAGR should be frontloaded for a growth company). A similar pessimist assessment should be made for Tesla&#39;s implied profit margins of ~12-14%. In Q3, Tesla&#39;s operating margin dropped further towards 10%, continuing the trend of margin compression started in late 2022. Tesla is now less profitable than the average S&amp;P 500 company, and only slightly more profitable (+200 basis points) than the average auto company. Notably, while Tesla&#39;s margins continue to drop, the margins of the average car company remain steady/ slightly increasing. This suggested convergence, if extrapolated, would cause a major crack in the Tesla equity story.</p><p></p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/d1ab2c7501faed985eff573d5b8750f3\" tg-width=\"640\" tg-height=\"285\"/></p><p>Tesla Q3 reporting</p><p></p><h2 id=\"id_3619475906\">Valuation Poised To Rerate Lower</h2><p>Some Seeking Alpha readers and Tesla investors believe that Tesla is not a car company. This I understand. And I also understand why this may be so, as Network Services, Mobility as a Service, Energy, and Insurance suggest a differentiated ecosystem approach. However, as of Q3 2023, Tesla still generates more than 85% of revenue from automotive sales, and the company posts margins of an automotive company too. Moreover, Tesla is exposed to cyclical fluctuations, like an automotive company (remember Elon Musk&#39;s commentary on rates, etc.,). Therefore, I advise investors to view and value Tesla like an automotive company until proven otherwise. And, in the context of Tesla&#39;s automotive business, ambitious product pitches such as the Model 2 and robotaxis should be viewed with an adequate dose of skepticism, until proven otherwise.</p><p>To underscore my argument, I drafted an overview below how Tesla&#39;s cost structure as of TTM 2023 compares to peers in the automotive industry and Google (GOOG). Notice how closely Tesla&#39;s cost buckets align with the industry, and how starkly they contrast with Google.</p><p></p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/c8c40b233617db4fb44d3fcbf0dfa5a1\" tg-width=\"640\" tg-height=\"272\"/></p><p>Author Research</p><p></p><p>That said, I advise to value Tesla with the below assumptions:</p><ul style=\"\"><li><p>Automotive sales CAGR of 10% through 2035</p></li><li><p>Average car price growth in line with inflation at 2% (this is optimistic, given that Tesla is aiming to reduce ASP)</p></li><li><p>Net profit margin for automotive in 2030 at 10%</p></li><li><p>For every Dollar of automotive revenue, Tesla generates 25 cents of other revenues; profit margin for other revenues at 35% (in line with tech companies)</p></li><li><p>Cost of Capital at 10.3%</p></li><li><p>Terminal Growth rate at 3%.</p></li></ul><p>In line with the assumptions above, I calculate a fair implied share price for Tesla stock equal to $95.55/ share, suggesting a double-digit valuation.</p><p></p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/1ecb68e2e3a8e9bc67b4cf4f911e9edd\" tg-width=\"640\" tg-height=\"291\"/></p><p>Analyst Assumption, Calculation; Company Financials</p><p></p><h2 id=\"id_3170230309\">Share Price Upside Risk</h2><p>Admittedly, several factors have the potential to drive upside for Tesla&#39;s share price. Most notably, Tesla could successfully launch previously teased products like the Cybertruck and Model 2, with better than expected demand. Further, if Tesla can enhance production capacity and efficiency as suggested by earlier company statements, the company may achieve stronger margins. In addition, upside risk for Tesla stock includes the growth of non-auto segments such as Network Services, Mobility, 3rd-Party battery/FSD licensing, Energy, and Insurance. Furthermore, Tesla&#39;s brand and reputation, as well as its global expansion efforts, also play a crucial role in driving positive sentiment and investor interest.</p><p>Lastly, it&#39;s important to recognize that Tesla is one of the most popular stocks for retail investors, and audience that may be more interested in speculative potential than in black-on-white fundamentals. Accordingly, if the stock market revisits a speculative event like in 2020-2021, Tesla could be one of the stocks with most price upside on speculative fever.</p><h2 id=\"id_1907616309\">Investor Takeaway</h2><p>Tesla&#39;s Q3 2023 results fell significantly short of expectations, prompting a sharp decline in its stock price. Shockingly, revenue growth was below double digits, and operating margins continued to compress. Moreover, Tesla management&#39;s caution on the macroeconomic environment, particularly around the Cybertruck launch and volume ramp-up, signaled potential headwinds over the next 18 months.</p><p>That said, despite Tesla&#39;s ambitions to diversify its revenue streams with Network Services, Mobility, 3rd-Party battery/FSD licensing, Energy, and Insurance, it remains predominantly an automotive company, with over 85% of revenue coming from automotive sales. This should be reflected in a valuation of the company. In line with my assumptions of what is reasonably achievable for Tesla by 2035, I calculate a fair implied share price of $95.55.</p><p>To conclude, I would be very surprised if, post-Q3, investors continue to view the Tesla story as told by CEO Elon Musk. And in my opinion, a share price rerating towards double-digit quotation should be materialized no later than end of 2024.</p></body></html>","source":"seekingalpha","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Tesla: Expecting Shares Down To Double-Digits By End Of 2024</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nTesla: Expecting Shares Down To Double-Digits By End Of 2024\n</h2>\n\n<h4 class=\"meta\">\n\n\n2023-10-31 07:36 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4644990-tesla-expecting-shares-down-to-double-digits-by-end-of-2024><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Tesla, Inc. Q3 results fell short of expectations, with revenue growth below double digits and operating margins continuing to compress.The cautious tone during the conference call highlighted ...</p>\n\n<a href=\"https://seekingalpha.com/article/4644990-tesla-expecting-shares-down-to-double-digits-by-end-of-2024\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"XPEV":"小鹏汽车","TSLL":"Direxion Daily TSLA Bull 2X Shares","NIO.SI":"蔚来","TSLA":"特斯拉","09866":"蔚来-SW","NIO":"蔚来","BYDDF":"BYD Co., Ltd."},"source_url":"https://seekingalpha.com/article/4644990-tesla-expecting-shares-down-to-double-digits-by-end-of-2024","is_english":true,"share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","article_id":"2379587283","content_text":"Tesla, Inc. Q3 results fell short of expectations, with revenue growth below double digits and operating margins continuing to compress.The cautious tone during the conference call highlighted potential headwinds, particularly around the Cybertruck launch and volume ramp-up.Despite ambitions to diversify revenue streams, Tesla remains predominantly an automotive company, and its valuation should reflect this.In line with my assumptions for Tesla, I calculate a fair implied value of $96/share.Tesla, Inc. (NASDAQ:TSLA) has delivered a very disappointing September quarter, missing consensus expectations on both revenue growth and profitability. While a quarterly consensus miss should not be a major headwind for most companies, the miss will likely be a major negative catalyst for Tesla. This is because for a long time, Tesla investors expected the electric vehicle (\"EV\") company to grow steadily, and aggressively, while maintaining higher margins than \"legacy car companies.\" Moreover, investors have trusted Elon Musk to manage the company with few missteps, taking an unconventional approach to product commercialization and marketing. These factors contributed to Tesla's eyewatering valuation, with shares trading at a 500% EV/Sales premium to competitors.However, with Tesla's growth falling below 10% year-over-year, and with operating profitability converging with margins of \"legacy car companies,\" the Tesla story is ripe for an aggressive review. Furthermore, Elon Musk's misstep with the Cybertruck highlights the vulnerability of overly ambitious, and unconventional, management decisions.Tesla's Q3 Reporting Shocks InvestorsTesla reported results for the 2023 Q3 period on October, 17th, and shocked investors with a broadly unsatisfactory performance. This led to a share price drop of more than 16% in less than 5 days, while the S&P 500 (SP500) managed to keep losses around 3%.Seeking AlphaThe numbers telling the story justify the selloff: during the 3 months leading up to the end of September, Tesla generated revenues of 23.4 billion, up only 9% year over year. Tesla's core business, automotive sales, performed even worse -- the segment only recorded a revenue growth of 5% year over year. Although analysts were already quite bearish going into Q3, consensus still expected Tesla's revenues to be about $1 billion higher.In Q3, Tesla also suffered a major profitability headwind. During the period, the company's gross margin dropped by more than 700 basis points, to 17.9%. This drop in margins may be attributed to both reduced cost absorption on lower production and pricing pressures. Operating expenses also exceeded expectations, up 43% year over year, bringing operating margin down by 964 basis points, to 7.6%. With margins under pressure, Tesla revealed lower than expected earnings per share of 66 cents, falling short of both consensus estimates of 72 cents. Now, investors should consider that the EPS would have been even worse, if not mitigated by some one-time positive factors like interest income, tax benefits, and regulatory credits, which contributed about 7-8 cents to Tesla's results.Tesla Q3 reportingCautious Conference Call Tone Further Underscores ChallengesTesla's third-quarter results not only fell below what analysts expected, but also triggered a cautious tone during the conference call. In fact, the Q3 call was one of the most negative Tesla calls that I have followed since the company's IPO. On one hand, Tesla's CEO, Elon Musk, and the management team were particularly cautious about the macroeconomic factors like rising interest rates, consumer strength, and affordability. This makes sense considering the price-tag of Tesla cars and the still ongoing hard vs. soft landing debate. On the other hand, Tesla management was also quite negative on some idiosyncratic success factors, most notably the Cybercrook and Tesla's broader volume ramp up going into 2024.Relating to the Cybertruck, CEO Elon Musk made a strong effort to manage expectations regarding their highly anticipated launch, hinting at negative impacts on margins and cash flow due to the Cybertruck over the next 18 months.I mean, we dug our own grave with Cybertruck ... Cybertruck’s one of those special products that comes along only once in a long while. And special products that come along once in a long while are just incredibly difficult to bring to market, to reach volume, to be prosperous.I do want to emphasize that there will be enormous challenges in reaching volume production with the Cybertruck, and then in making a Cybertruck cash flow positive ... [it will take] a year to 18 months before it is a significant positive cash flow contributor.So, it is clear that Tesla expects the Cybertruck, their major product launch in the coming years, to affect profit margins and free cash flow negatively. In my opinion, investors should not be too surprised about this. But what does surprise is the steady state volume target of the product. While there's been a lot of hype with over 1,000,000 orders, reasonable expectations have skewed toward more bullish scenarios, with some investors anticipating over 500,000 units annually. This fantasy was crushed by Elon Musk's comment that volume may be closer to 250,000.I think we’ll end up with roughly a 0.25 million Cybertrucks a year, I don’t think we’re going to reach that output rate next year. I think we’ll probably reach it sometime in 2025. That’s my best guess.Another significant cause for concern, in my opinion, was the commentary regarding the company's future production volume. While Tesla reaffirmed its 1.8 million unit target for the year, and announced deliveries for its Cybertruck, scheduled for November 30, the company's statements about production in Shanghai, Austin, and Berlin signaled volume headwinds: Tesla indicated that Shanghai's production would not see a substantial increase in Q4, and the ramp-up in Austin and Berlin would be gradual. The company attributed this gradual ramp-up to various challenges to production processes. But in my opinion, it may also hint at weaker demand, specifically in China, where the macro backdrop is challenged and competition against local rivals such as XPeng (XPEV), NIO (NIO), and BYD Company (OTCPK:BYDDF) is rising.This commentary suggests that expectations for Tesla's 2024 deliveries should be more cautious. In fact, a year ago, before analysts were aware of any forthcoming price cuts, Bloomberg's consensus estimate for Tesla's 2023 vehicle deliveries was about 2.05 million. Now, even after the price reductions, the current consensus estimate for 2023 stands at 1.81 million. So, contrary to expectations, Tesla's decision to implement price reductions of 15-20% across its entire product range hasn't led to increased vehicle sales. Instead, these price cuts were highly likely necessitated by weaker-than-expected demand.The Tesla Story Is CrackingReferencing Tesla's ~70x EV/EBIT valuation, there are quite a few assumptions that investors imply for the stock to justify the trading multiple. First and foremost, Tesla must be growing ~30% CAGR until 2025, followed by low double-digit growth rates thereafter through at least 2035. Moreover, Tesla's operating margin at the end of the growth cycle must be between somewhere around ~12-14%. Only with these assumptions would Tesla achieve a ~$48-52 billion EBIT by 2035, which benchmarked against the company's $650 billion enterprise value, would suggest an EV/EBIT that is in line with the automotive industry median. Otherwise, the math simply does not add up.If an investor believes the above assumptions, then Tesla's valuation at ~70x EV/EBIT is justified. The argument I am making is that long-time investors simply accepted the growth and margin story so long as Tesla delivered numbers to support the thesis. With Q3, however, Tesla failed to deliver numbers that support the above made assumptions. And with this, a rerating is in the cards.Seeking AlphaWith Tesla's top line growth slowing to below double-digit in Q3 2023 already, the geometric average of ~15% CAGR through 2035 looks increasingly unreasonable (consider that high CAGR should be frontloaded for a growth company). A similar pessimist assessment should be made for Tesla's implied profit margins of ~12-14%. In Q3, Tesla's operating margin dropped further towards 10%, continuing the trend of margin compression started in late 2022. Tesla is now less profitable than the average S&P 500 company, and only slightly more profitable (+200 basis points) than the average auto company. Notably, while Tesla's margins continue to drop, the margins of the average car company remain steady/ slightly increasing. This suggested convergence, if extrapolated, would cause a major crack in the Tesla equity story.Tesla Q3 reportingValuation Poised To Rerate LowerSome Seeking Alpha readers and Tesla investors believe that Tesla is not a car company. This I understand. And I also understand why this may be so, as Network Services, Mobility as a Service, Energy, and Insurance suggest a differentiated ecosystem approach. However, as of Q3 2023, Tesla still generates more than 85% of revenue from automotive sales, and the company posts margins of an automotive company too. Moreover, Tesla is exposed to cyclical fluctuations, like an automotive company (remember Elon Musk's commentary on rates, etc.,). Therefore, I advise investors to view and value Tesla like an automotive company until proven otherwise. And, in the context of Tesla's automotive business, ambitious product pitches such as the Model 2 and robotaxis should be viewed with an adequate dose of skepticism, until proven otherwise.To underscore my argument, I drafted an overview below how Tesla's cost structure as of TTM 2023 compares to peers in the automotive industry and Google (GOOG). Notice how closely Tesla's cost buckets align with the industry, and how starkly they contrast with Google.Author ResearchThat said, I advise to value Tesla with the below assumptions:Automotive sales CAGR of 10% through 2035Average car price growth in line with inflation at 2% (this is optimistic, given that Tesla is aiming to reduce ASP)Net profit margin for automotive in 2030 at 10%For every Dollar of automotive revenue, Tesla generates 25 cents of other revenues; profit margin for other revenues at 35% (in line with tech companies)Cost of Capital at 10.3%Terminal Growth rate at 3%.In line with the assumptions above, I calculate a fair implied share price for Tesla stock equal to $95.55/ share, suggesting a double-digit valuation.Analyst Assumption, Calculation; Company FinancialsShare Price Upside RiskAdmittedly, several factors have the potential to drive upside for Tesla's share price. Most notably, Tesla could successfully launch previously teased products like the Cybertruck and Model 2, with better than expected demand. Further, if Tesla can enhance production capacity and efficiency as suggested by earlier company statements, the company may achieve stronger margins. In addition, upside risk for Tesla stock includes the growth of non-auto segments such as Network Services, Mobility, 3rd-Party battery/FSD licensing, Energy, and Insurance. Furthermore, Tesla's brand and reputation, as well as its global expansion efforts, also play a crucial role in driving positive sentiment and investor interest.Lastly, it's important to recognize that Tesla is one of the most popular stocks for retail investors, and audience that may be more interested in speculative potential than in black-on-white fundamentals. Accordingly, if the stock market revisits a speculative event like in 2020-2021, Tesla could be one of the stocks with most price upside on speculative fever.Investor TakeawayTesla's Q3 2023 results fell significantly short of expectations, prompting a sharp decline in its stock price. Shockingly, revenue growth was below double digits, and operating margins continued to compress. Moreover, Tesla management's caution on the macroeconomic environment, particularly around the Cybertruck launch and volume ramp-up, signaled potential headwinds over the next 18 months.That said, despite Tesla's ambitions to diversify its revenue streams with Network Services, Mobility, 3rd-Party battery/FSD licensing, Energy, and Insurance, it remains predominantly an automotive company, with over 85% of revenue coming from automotive sales. This should be reflected in a valuation of the company. In line with my assumptions of what is reasonably achievable for Tesla by 2035, I calculate a fair implied share price of $95.55.To conclude, I would be very surprised if, post-Q3, investors continue to view the Tesla story as told by CEO Elon Musk. And in my opinion, a share price rerating towards double-digit quotation should be materialized no later than end of 2024.","news_type":1},"isVote":1,"tweetType":1,"viewCount":821,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":232871521169648,"gmtCreate":1697882092020,"gmtModify":1697884359971,"author":{"id":"4147477973119532","authorId":"4147477973119532","name":"OGM","avatar":"https://community-static.tradeup.com/news/default-avatar.jpg","crmLevel":1,"crmLevelSwitch":0,"followedFlag":false,"idStr":"4147477973119532","authorIdStr":"4147477973119532"},"themes":[],"htmlText":"Today the kids and I went for a walk and we played a game of spot- the-EVs. 11 Teslas, a Nissan Leaf which barely qualifies as a real car, and a Toyota which shouldn't have been on the list because it's a hybrid but we felt sorry for them.&nbsp; My bet is that, BYD excluded, all of these companies will be bankrupt by the end of 2025. Tesla will survive.&nbsp;","listText":"Today the kids and I went for a walk and we played a game of spot- the-EVs. 11 Teslas, a Nissan Leaf which barely qualifies as a real car, and a Toyota which shouldn't have been on the list because it's a hybrid but we felt sorry for them.&nbsp; My bet is that, BYD excluded, all of these companies will be bankrupt by the end of 2025. Tesla will survive.&nbsp;","text":"Today the kids and I went for a walk and we played a game of spot- the-EVs. 11 Teslas, a Nissan Leaf which barely qualifies as a real car, and a Toyota which shouldn't have been on the list because it's a hybrid but we felt sorry for them. My bet is that, BYD excluded, all of these companies will be bankrupt by the end of 2025. Tesla will survive.","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":6,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/232871521169648","repostId":"2376243284","repostType":2,"isVote":1,"tweetType":1,"viewCount":525,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0}],"hots":[{"id":236252839121112,"gmtCreate":1698711657908,"gmtModify":1698718270006,"author":{"id":"4147477973119532","authorId":"4147477973119532","name":"OGM","avatar":"https://community-static.tradeup.com/news/default-avatar.jpg","crmLevel":1,"crmLevelSwitch":0,"followedFlag":false,"idStr":"4147477973119532","authorIdStr":"4147477973119532"},"themes":[],"htmlText":"Why do people not believe Elon? When he said don't buy anything for the next 18 months, while he was actively selling his Tesla shares, why not believe him? When he said exactly what the company's focus would be in 3 secret plans, why doesn't a single analyst take the time to read these documents? Read them, especially the most recent, and you'll see that the company has no interest in what it's share price does, in share price movement, or ever paying a dividend. In previous plans the focus was on disrupting the global ICE car markets.&nbsp; They'll continue reducing prices to force other manufacturers to do the same, to force price parity with similar sizes ICE vehicles. It's not about sales for Tesla, it's about using EV competitors to disrupt an industry.&nbsp; In plan 3 vehicle sales","listText":"Why do people not believe Elon? When he said don't buy anything for the next 18 months, while he was actively selling his Tesla shares, why not believe him? When he said exactly what the company's focus would be in 3 secret plans, why doesn't a single analyst take the time to read these documents? Read them, especially the most recent, and you'll see that the company has no interest in what it's share price does, in share price movement, or ever paying a dividend. In previous plans the focus was on disrupting the global ICE car markets.&nbsp; They'll continue reducing prices to force other manufacturers to do the same, to force price parity with similar sizes ICE vehicles. It's not about sales for Tesla, it's about using EV competitors to disrupt an industry.&nbsp; In plan 3 vehicle sales","text":"Why do people not believe Elon? When he said don't buy anything for the next 18 months, while he was actively selling his Tesla shares, why not believe him? When he said exactly what the company's focus would be in 3 secret plans, why doesn't a single analyst take the time to read these documents? Read them, especially the most recent, and you'll see that the company has no interest in what it's share price does, in share price movement, or ever paying a dividend. In previous plans the focus was on disrupting the global ICE car markets. They'll continue reducing prices to force other manufacturers to do the same, to force price parity with similar sizes ICE vehicles. It's not about sales for Tesla, it's about using EV competitors to disrupt an industry. In plan 3 vehicle sales","images":[],"top":1,"highlighted":1,"essential":2,"paper":1,"likeSize":9,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/236252839121112","repostId":"2379587283","repostType":2,"repost":{"id":"2379587283","kind":"highlight","pubTimestamp":1698708985,"share":"https://ttm.financial/m/news/2379587283?lang=&edition=fundamental","pubTime":"2023-10-31 07:36","market":"us","language":"en","title":"Tesla: Expecting Shares Down To Double-Digits By End Of 2024","url":"https://stock-news.laohu8.com/highlight/detail?id=2379587283","media":"seekingalpha","summary":"Tesla, Inc. Q3 results fell short of expectations, with revenue growth below double digits and operating margins continuing to compress.The cautious tone during the conference call highlighted potenti","content":"<html><head></head><body><ul style=\"\"><li><p>Tesla, Inc. Q3 results fell short of expectations, with revenue growth below double digits and operating margins continuing to compress.</p></li><li><p>The cautious tone during the conference call highlighted potential headwinds, particularly around the Cybertruck launch and volume ramp-up.</p></li><li><p>Despite ambitions to diversify revenue streams, Tesla remains predominantly an automotive company, and its valuation should reflect this.</p></li><li><p>In line with my assumptions for Tesla, I calculate a fair implied value of $96/share.</p></li></ul><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/f269ab09a8f74eb124f6af73c3786a69\" tg-width=\"750\" tg-height=\"507\"/></p><p>Tesla, Inc. (NASDAQ:TSLA) has delivered a very disappointing September quarter, missing consensus expectations on both revenue growth and profitability. While a quarterly consensus miss should not be a major headwind for most companies, the miss will likely be a major negative catalyst for Tesla. This is because for a long time, Tesla investors expected the electric vehicle (&#34;EV&#34;) company to grow steadily, and aggressively, while maintaining higher margins than &#34;legacy car companies.&#34; Moreover, investors have trusted Elon Musk to manage the company with few missteps, taking an unconventional approach to product commercialization and marketing. These factors contributed to Tesla&#39;s eyewatering valuation, with shares trading at a 500% EV/Sales premium to competitors.</p><p>However, with Tesla&#39;s growth falling below 10% year-over-year, and with operating profitability converging with margins of &#34;legacy car companies,&#34; the Tesla story is ripe for an aggressive review. Furthermore, Elon Musk&#39;s misstep with the Cybertruck highlights the vulnerability of overly ambitious, and unconventional, management decisions.</p><h2 id=\"id_810197368\">Tesla&#39;s Q3 Reporting Shocks Investors</h2><p>Tesla reported results for the 2023 Q3 period on October, 17th, and shocked investors with a broadly unsatisfactory performance. This led to a share price drop of more than 16% in less than 5 days, while the S&amp;P 500 (SP500) managed to keep losses around 3%.</p><p></p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/ffda870e3c2963dee33e30b2113b8cba\" tg-width=\"640\" tg-height=\"236\"/></p><p>Seeking Alpha</p><p></p><p>The numbers telling the story justify the selloff: during the 3 months leading up to the end of September, Tesla generated revenues of 23.4 billion, up only 9% year over year. Tesla&#39;s core business, automotive sales, performed even worse -- the segment only recorded a revenue growth of 5% year over year. Although analysts were already quite bearish going into Q3, consensus still expected Tesla&#39;s revenues to be about $1 billion higher.</p><p>In Q3, Tesla also suffered a major profitability headwind. During the period, the company&#39;s gross margin dropped by more than 700 basis points, to 17.9%. This drop in margins may be attributed to both reduced cost absorption on lower production and pricing pressures. Operating expenses also exceeded expectations, up 43% year over year, bringing operating margin down by 964 basis points, to 7.6%. With margins under pressure, Tesla revealed lower than expected earnings per share of 66 cents, falling short of both consensus estimates of 72 cents. Now, investors should consider that the EPS would have been even worse, if not mitigated by some one-time positive factors like interest income, tax benefits, and regulatory credits, which contributed about 7-8 cents to Tesla&#39;s results.</p><p></p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/3d04bce4218e0f7e4535249c37fd7bbb\" tg-width=\"640\" tg-height=\"320\"/></p><p>Tesla Q3 reporting</p><p></p><h2 id=\"id_1334617368\">Cautious Conference Call Tone Further Underscores Challenges</h2><p>Tesla&#39;s third-quarter results not only fell below what analysts expected, but also triggered a cautious tone during the conference call. In fact, the Q3 call was one of the most negative Tesla calls that I have followed since the company&#39;s IPO. On one hand, Tesla&#39;s CEO, Elon Musk, and the management team were particularly cautious about the macroeconomic factors like rising interest rates, consumer strength, and affordability. This makes sense considering the price-tag of Tesla cars and the still ongoing hard vs. soft landing debate. On the other hand, Tesla management was also quite negative on some idiosyncratic success factors, most notably the Cybercrook and Tesla&#39;s broader volume ramp up going into 2024.</p><p>Relating to the Cybertruck, CEO Elon Musk made a strong effort to manage expectations regarding their highly anticipated launch, hinting at negative impacts on margins and cash flow due to the Cybertruck over the next 18 months.</p><blockquote><p><em>I mean, we dug our own grave with Cybertruck ... Cybertruck’s one of those special products that comes along only once in a long while. And special products that come along once in a long while are just incredibly difficult to bring to market, to reach volume, to be prosperous.</em></p><p><em>I do want to emphasize that there will be enormous challenges in reaching volume production with the Cybertruck, and then in making a Cybertruck cash flow positive ... [it will take] a year to 18 months before it is a significant positive cash flow contributor.</em></p></blockquote><p>So, it is clear that Tesla expects the Cybertruck, their major product launch in the coming years, to affect profit margins and free cash flow negatively. In my opinion, investors should not be too surprised about this. But what does surprise is the steady state volume target of the product. While there&#39;s been a lot of hype with over 1,000,000 orders, reasonable expectations have skewed toward more bullish scenarios, with some investors anticipating over 500,000 units annually. This fantasy was crushed by Elon Musk&#39;s comment that volume may be closer to 250,000.</p><blockquote><p><em>I think we’ll end up with roughly a 0.25 million Cybertrucks a year, I don’t think we’re going to reach that output rate next year. I think we’ll probably reach it sometime in 2025. That’s my best guess.</em></p></blockquote><p>Another significant cause for concern, in my opinion, was the commentary regarding the company&#39;s future production volume. While Tesla reaffirmed its 1.8 million unit target for the year, and announced deliveries for its Cybertruck, scheduled for November 30, the company&#39;s statements about production in Shanghai, Austin, and Berlin signaled volume headwinds: Tesla indicated that Shanghai&#39;s production would not see a substantial increase in Q4, and the ramp-up in Austin and Berlin would be gradual. The company attributed this gradual ramp-up to various challenges to production processes. But in my opinion, it may also hint at weaker demand, specifically in China, where the macro backdrop is challenged and competition against local rivals such as XPeng (XPEV), NIO (NIO), and BYD Company (OTCPK:BYDDF) is rising.</p><p>This commentary suggests that expectations for Tesla&#39;s 2024 deliveries should be more cautious. In fact, a year ago, before analysts were aware of any forthcoming price cuts, Bloomberg&#39;s consensus estimate for Tesla&#39;s 2023 vehicle deliveries was about 2.05 million. Now, even after the price reductions, the current consensus estimate for 2023 stands at 1.81 million. So, contrary to expectations, Tesla&#39;s decision to implement price reductions of 15-20% across its entire product range hasn&#39;t led to increased vehicle sales. Instead, these price cuts were highly likely necessitated by weaker-than-expected demand.</p><h2 id=\"id_2042484236\">The Tesla Story Is Cracking</h2><p>Referencing Tesla&#39;s ~70x EV/EBIT valuation, there are quite a few assumptions that investors imply for the stock to justify the trading multiple. First and foremost, Tesla must be growing ~30% CAGR until 2025, followed by low double-digit growth rates thereafter through at least 2035. Moreover, Tesla&#39;s operating margin at the end of the growth cycle must be between somewhere around ~12-14%. Only with these assumptions would Tesla achieve a ~$48-52 billion EBIT by 2035, which benchmarked against the company&#39;s $650 billion enterprise value, would suggest an EV/EBIT that is in line with the automotive industry median. Otherwise, the math simply does not add up.</p><p>If an investor believes the above assumptions, then Tesla&#39;s valuation at ~70x EV/EBIT is justified. The argument I am making is that long-time investors simply accepted the growth and margin story so long as Tesla delivered numbers to support the thesis. With Q3, however, Tesla failed to deliver numbers that support the above made assumptions. And with this, a rerating is in the cards.</p><p></p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/db0b8144c3e964c32c8fcfebe520edf6\" tg-width=\"640\" tg-height=\"553\"/></p><p>Seeking Alpha</p><p></p><p>With Tesla&#39;s top line growth slowing to below double-digit in Q3 2023 already, the geometric average of ~15% CAGR through 2035 looks increasingly unreasonable (consider that high CAGR should be frontloaded for a growth company). A similar pessimist assessment should be made for Tesla&#39;s implied profit margins of ~12-14%. In Q3, Tesla&#39;s operating margin dropped further towards 10%, continuing the trend of margin compression started in late 2022. Tesla is now less profitable than the average S&amp;P 500 company, and only slightly more profitable (+200 basis points) than the average auto company. Notably, while Tesla&#39;s margins continue to drop, the margins of the average car company remain steady/ slightly increasing. This suggested convergence, if extrapolated, would cause a major crack in the Tesla equity story.</p><p></p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/d1ab2c7501faed985eff573d5b8750f3\" tg-width=\"640\" tg-height=\"285\"/></p><p>Tesla Q3 reporting</p><p></p><h2 id=\"id_3619475906\">Valuation Poised To Rerate Lower</h2><p>Some Seeking Alpha readers and Tesla investors believe that Tesla is not a car company. This I understand. And I also understand why this may be so, as Network Services, Mobility as a Service, Energy, and Insurance suggest a differentiated ecosystem approach. However, as of Q3 2023, Tesla still generates more than 85% of revenue from automotive sales, and the company posts margins of an automotive company too. Moreover, Tesla is exposed to cyclical fluctuations, like an automotive company (remember Elon Musk&#39;s commentary on rates, etc.,). Therefore, I advise investors to view and value Tesla like an automotive company until proven otherwise. And, in the context of Tesla&#39;s automotive business, ambitious product pitches such as the Model 2 and robotaxis should be viewed with an adequate dose of skepticism, until proven otherwise.</p><p>To underscore my argument, I drafted an overview below how Tesla&#39;s cost structure as of TTM 2023 compares to peers in the automotive industry and Google (GOOG). Notice how closely Tesla&#39;s cost buckets align with the industry, and how starkly they contrast with Google.</p><p></p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/c8c40b233617db4fb44d3fcbf0dfa5a1\" tg-width=\"640\" tg-height=\"272\"/></p><p>Author Research</p><p></p><p>That said, I advise to value Tesla with the below assumptions:</p><ul style=\"\"><li><p>Automotive sales CAGR of 10% through 2035</p></li><li><p>Average car price growth in line with inflation at 2% (this is optimistic, given that Tesla is aiming to reduce ASP)</p></li><li><p>Net profit margin for automotive in 2030 at 10%</p></li><li><p>For every Dollar of automotive revenue, Tesla generates 25 cents of other revenues; profit margin for other revenues at 35% (in line with tech companies)</p></li><li><p>Cost of Capital at 10.3%</p></li><li><p>Terminal Growth rate at 3%.</p></li></ul><p>In line with the assumptions above, I calculate a fair implied share price for Tesla stock equal to $95.55/ share, suggesting a double-digit valuation.</p><p></p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/1ecb68e2e3a8e9bc67b4cf4f911e9edd\" tg-width=\"640\" tg-height=\"291\"/></p><p>Analyst Assumption, Calculation; Company Financials</p><p></p><h2 id=\"id_3170230309\">Share Price Upside Risk</h2><p>Admittedly, several factors have the potential to drive upside for Tesla&#39;s share price. Most notably, Tesla could successfully launch previously teased products like the Cybertruck and Model 2, with better than expected demand. Further, if Tesla can enhance production capacity and efficiency as suggested by earlier company statements, the company may achieve stronger margins. In addition, upside risk for Tesla stock includes the growth of non-auto segments such as Network Services, Mobility, 3rd-Party battery/FSD licensing, Energy, and Insurance. Furthermore, Tesla&#39;s brand and reputation, as well as its global expansion efforts, also play a crucial role in driving positive sentiment and investor interest.</p><p>Lastly, it&#39;s important to recognize that Tesla is one of the most popular stocks for retail investors, and audience that may be more interested in speculative potential than in black-on-white fundamentals. Accordingly, if the stock market revisits a speculative event like in 2020-2021, Tesla could be one of the stocks with most price upside on speculative fever.</p><h2 id=\"id_1907616309\">Investor Takeaway</h2><p>Tesla&#39;s Q3 2023 results fell significantly short of expectations, prompting a sharp decline in its stock price. Shockingly, revenue growth was below double digits, and operating margins continued to compress. Moreover, Tesla management&#39;s caution on the macroeconomic environment, particularly around the Cybertruck launch and volume ramp-up, signaled potential headwinds over the next 18 months.</p><p>That said, despite Tesla&#39;s ambitions to diversify its revenue streams with Network Services, Mobility, 3rd-Party battery/FSD licensing, Energy, and Insurance, it remains predominantly an automotive company, with over 85% of revenue coming from automotive sales. This should be reflected in a valuation of the company. In line with my assumptions of what is reasonably achievable for Tesla by 2035, I calculate a fair implied share price of $95.55.</p><p>To conclude, I would be very surprised if, post-Q3, investors continue to view the Tesla story as told by CEO Elon Musk. And in my opinion, a share price rerating towards double-digit quotation should be materialized no later than end of 2024.</p></body></html>","source":"seekingalpha","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Tesla: Expecting Shares Down To Double-Digits By End Of 2024</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nTesla: Expecting Shares Down To Double-Digits By End Of 2024\n</h2>\n\n<h4 class=\"meta\">\n\n\n2023-10-31 07:36 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4644990-tesla-expecting-shares-down-to-double-digits-by-end-of-2024><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Tesla, Inc. Q3 results fell short of expectations, with revenue growth below double digits and operating margins continuing to compress.The cautious tone during the conference call highlighted ...</p>\n\n<a href=\"https://seekingalpha.com/article/4644990-tesla-expecting-shares-down-to-double-digits-by-end-of-2024\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"XPEV":"小鹏汽车","TSLL":"Direxion Daily TSLA Bull 2X Shares","NIO.SI":"蔚来","TSLA":"特斯拉","09866":"蔚来-SW","NIO":"蔚来","BYDDF":"BYD Co., Ltd."},"source_url":"https://seekingalpha.com/article/4644990-tesla-expecting-shares-down-to-double-digits-by-end-of-2024","is_english":true,"share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","article_id":"2379587283","content_text":"Tesla, Inc. Q3 results fell short of expectations, with revenue growth below double digits and operating margins continuing to compress.The cautious tone during the conference call highlighted potential headwinds, particularly around the Cybertruck launch and volume ramp-up.Despite ambitions to diversify revenue streams, Tesla remains predominantly an automotive company, and its valuation should reflect this.In line with my assumptions for Tesla, I calculate a fair implied value of $96/share.Tesla, Inc. (NASDAQ:TSLA) has delivered a very disappointing September quarter, missing consensus expectations on both revenue growth and profitability. While a quarterly consensus miss should not be a major headwind for most companies, the miss will likely be a major negative catalyst for Tesla. This is because for a long time, Tesla investors expected the electric vehicle (\"EV\") company to grow steadily, and aggressively, while maintaining higher margins than \"legacy car companies.\" Moreover, investors have trusted Elon Musk to manage the company with few missteps, taking an unconventional approach to product commercialization and marketing. These factors contributed to Tesla's eyewatering valuation, with shares trading at a 500% EV/Sales premium to competitors.However, with Tesla's growth falling below 10% year-over-year, and with operating profitability converging with margins of \"legacy car companies,\" the Tesla story is ripe for an aggressive review. Furthermore, Elon Musk's misstep with the Cybertruck highlights the vulnerability of overly ambitious, and unconventional, management decisions.Tesla's Q3 Reporting Shocks InvestorsTesla reported results for the 2023 Q3 period on October, 17th, and shocked investors with a broadly unsatisfactory performance. This led to a share price drop of more than 16% in less than 5 days, while the S&P 500 (SP500) managed to keep losses around 3%.Seeking AlphaThe numbers telling the story justify the selloff: during the 3 months leading up to the end of September, Tesla generated revenues of 23.4 billion, up only 9% year over year. Tesla's core business, automotive sales, performed even worse -- the segment only recorded a revenue growth of 5% year over year. Although analysts were already quite bearish going into Q3, consensus still expected Tesla's revenues to be about $1 billion higher.In Q3, Tesla also suffered a major profitability headwind. During the period, the company's gross margin dropped by more than 700 basis points, to 17.9%. This drop in margins may be attributed to both reduced cost absorption on lower production and pricing pressures. Operating expenses also exceeded expectations, up 43% year over year, bringing operating margin down by 964 basis points, to 7.6%. With margins under pressure, Tesla revealed lower than expected earnings per share of 66 cents, falling short of both consensus estimates of 72 cents. Now, investors should consider that the EPS would have been even worse, if not mitigated by some one-time positive factors like interest income, tax benefits, and regulatory credits, which contributed about 7-8 cents to Tesla's results.Tesla Q3 reportingCautious Conference Call Tone Further Underscores ChallengesTesla's third-quarter results not only fell below what analysts expected, but also triggered a cautious tone during the conference call. In fact, the Q3 call was one of the most negative Tesla calls that I have followed since the company's IPO. On one hand, Tesla's CEO, Elon Musk, and the management team were particularly cautious about the macroeconomic factors like rising interest rates, consumer strength, and affordability. This makes sense considering the price-tag of Tesla cars and the still ongoing hard vs. soft landing debate. On the other hand, Tesla management was also quite negative on some idiosyncratic success factors, most notably the Cybercrook and Tesla's broader volume ramp up going into 2024.Relating to the Cybertruck, CEO Elon Musk made a strong effort to manage expectations regarding their highly anticipated launch, hinting at negative impacts on margins and cash flow due to the Cybertruck over the next 18 months.I mean, we dug our own grave with Cybertruck ... Cybertruck’s one of those special products that comes along only once in a long while. And special products that come along once in a long while are just incredibly difficult to bring to market, to reach volume, to be prosperous.I do want to emphasize that there will be enormous challenges in reaching volume production with the Cybertruck, and then in making a Cybertruck cash flow positive ... [it will take] a year to 18 months before it is a significant positive cash flow contributor.So, it is clear that Tesla expects the Cybertruck, their major product launch in the coming years, to affect profit margins and free cash flow negatively. In my opinion, investors should not be too surprised about this. But what does surprise is the steady state volume target of the product. While there's been a lot of hype with over 1,000,000 orders, reasonable expectations have skewed toward more bullish scenarios, with some investors anticipating over 500,000 units annually. This fantasy was crushed by Elon Musk's comment that volume may be closer to 250,000.I think we’ll end up with roughly a 0.25 million Cybertrucks a year, I don’t think we’re going to reach that output rate next year. I think we’ll probably reach it sometime in 2025. That’s my best guess.Another significant cause for concern, in my opinion, was the commentary regarding the company's future production volume. While Tesla reaffirmed its 1.8 million unit target for the year, and announced deliveries for its Cybertruck, scheduled for November 30, the company's statements about production in Shanghai, Austin, and Berlin signaled volume headwinds: Tesla indicated that Shanghai's production would not see a substantial increase in Q4, and the ramp-up in Austin and Berlin would be gradual. The company attributed this gradual ramp-up to various challenges to production processes. But in my opinion, it may also hint at weaker demand, specifically in China, where the macro backdrop is challenged and competition against local rivals such as XPeng (XPEV), NIO (NIO), and BYD Company (OTCPK:BYDDF) is rising.This commentary suggests that expectations for Tesla's 2024 deliveries should be more cautious. In fact, a year ago, before analysts were aware of any forthcoming price cuts, Bloomberg's consensus estimate for Tesla's 2023 vehicle deliveries was about 2.05 million. Now, even after the price reductions, the current consensus estimate for 2023 stands at 1.81 million. So, contrary to expectations, Tesla's decision to implement price reductions of 15-20% across its entire product range hasn't led to increased vehicle sales. Instead, these price cuts were highly likely necessitated by weaker-than-expected demand.The Tesla Story Is CrackingReferencing Tesla's ~70x EV/EBIT valuation, there are quite a few assumptions that investors imply for the stock to justify the trading multiple. First and foremost, Tesla must be growing ~30% CAGR until 2025, followed by low double-digit growth rates thereafter through at least 2035. Moreover, Tesla's operating margin at the end of the growth cycle must be between somewhere around ~12-14%. Only with these assumptions would Tesla achieve a ~$48-52 billion EBIT by 2035, which benchmarked against the company's $650 billion enterprise value, would suggest an EV/EBIT that is in line with the automotive industry median. Otherwise, the math simply does not add up.If an investor believes the above assumptions, then Tesla's valuation at ~70x EV/EBIT is justified. The argument I am making is that long-time investors simply accepted the growth and margin story so long as Tesla delivered numbers to support the thesis. With Q3, however, Tesla failed to deliver numbers that support the above made assumptions. And with this, a rerating is in the cards.Seeking AlphaWith Tesla's top line growth slowing to below double-digit in Q3 2023 already, the geometric average of ~15% CAGR through 2035 looks increasingly unreasonable (consider that high CAGR should be frontloaded for a growth company). A similar pessimist assessment should be made for Tesla's implied profit margins of ~12-14%. In Q3, Tesla's operating margin dropped further towards 10%, continuing the trend of margin compression started in late 2022. Tesla is now less profitable than the average S&P 500 company, and only slightly more profitable (+200 basis points) than the average auto company. Notably, while Tesla's margins continue to drop, the margins of the average car company remain steady/ slightly increasing. This suggested convergence, if extrapolated, would cause a major crack in the Tesla equity story.Tesla Q3 reportingValuation Poised To Rerate LowerSome Seeking Alpha readers and Tesla investors believe that Tesla is not a car company. This I understand. And I also understand why this may be so, as Network Services, Mobility as a Service, Energy, and Insurance suggest a differentiated ecosystem approach. However, as of Q3 2023, Tesla still generates more than 85% of revenue from automotive sales, and the company posts margins of an automotive company too. Moreover, Tesla is exposed to cyclical fluctuations, like an automotive company (remember Elon Musk's commentary on rates, etc.,). Therefore, I advise investors to view and value Tesla like an automotive company until proven otherwise. And, in the context of Tesla's automotive business, ambitious product pitches such as the Model 2 and robotaxis should be viewed with an adequate dose of skepticism, until proven otherwise.To underscore my argument, I drafted an overview below how Tesla's cost structure as of TTM 2023 compares to peers in the automotive industry and Google (GOOG). Notice how closely Tesla's cost buckets align with the industry, and how starkly they contrast with Google.Author ResearchThat said, I advise to value Tesla with the below assumptions:Automotive sales CAGR of 10% through 2035Average car price growth in line with inflation at 2% (this is optimistic, given that Tesla is aiming to reduce ASP)Net profit margin for automotive in 2030 at 10%For every Dollar of automotive revenue, Tesla generates 25 cents of other revenues; profit margin for other revenues at 35% (in line with tech companies)Cost of Capital at 10.3%Terminal Growth rate at 3%.In line with the assumptions above, I calculate a fair implied share price for Tesla stock equal to $95.55/ share, suggesting a double-digit valuation.Analyst Assumption, Calculation; Company FinancialsShare Price Upside RiskAdmittedly, several factors have the potential to drive upside for Tesla's share price. Most notably, Tesla could successfully launch previously teased products like the Cybertruck and Model 2, with better than expected demand. Further, if Tesla can enhance production capacity and efficiency as suggested by earlier company statements, the company may achieve stronger margins. In addition, upside risk for Tesla stock includes the growth of non-auto segments such as Network Services, Mobility, 3rd-Party battery/FSD licensing, Energy, and Insurance. Furthermore, Tesla's brand and reputation, as well as its global expansion efforts, also play a crucial role in driving positive sentiment and investor interest.Lastly, it's important to recognize that Tesla is one of the most popular stocks for retail investors, and audience that may be more interested in speculative potential than in black-on-white fundamentals. Accordingly, if the stock market revisits a speculative event like in 2020-2021, Tesla could be one of the stocks with most price upside on speculative fever.Investor TakeawayTesla's Q3 2023 results fell significantly short of expectations, prompting a sharp decline in its stock price. Shockingly, revenue growth was below double digits, and operating margins continued to compress. Moreover, Tesla management's caution on the macroeconomic environment, particularly around the Cybertruck launch and volume ramp-up, signaled potential headwinds over the next 18 months.That said, despite Tesla's ambitions to diversify its revenue streams with Network Services, Mobility, 3rd-Party battery/FSD licensing, Energy, and Insurance, it remains predominantly an automotive company, with over 85% of revenue coming from automotive sales. This should be reflected in a valuation of the company. In line with my assumptions of what is reasonably achievable for Tesla by 2035, I calculate a fair implied share price of $95.55.To conclude, I would be very surprised if, post-Q3, investors continue to view the Tesla story as told by CEO Elon Musk. And in my opinion, a share price rerating towards double-digit quotation should be materialized no later than end of 2024.","news_type":1},"isVote":1,"tweetType":1,"viewCount":821,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":232871521169648,"gmtCreate":1697882092020,"gmtModify":1697884359971,"author":{"id":"4147477973119532","authorId":"4147477973119532","name":"OGM","avatar":"https://community-static.tradeup.com/news/default-avatar.jpg","crmLevel":1,"crmLevelSwitch":0,"followedFlag":false,"idStr":"4147477973119532","authorIdStr":"4147477973119532"},"themes":[],"htmlText":"Today the kids and I went for a walk and we played a game of spot- the-EVs. 11 Teslas, a Nissan Leaf which barely qualifies as a real car, and a Toyota which shouldn't have been on the list because it's a hybrid but we felt sorry for them.&nbsp; My bet is that, BYD excluded, all of these companies will be bankrupt by the end of 2025. Tesla will survive.&nbsp;","listText":"Today the kids and I went for a walk and we played a game of spot- the-EVs. 11 Teslas, a Nissan Leaf which barely qualifies as a real car, and a Toyota which shouldn't have been on the list because it's a hybrid but we felt sorry for them.&nbsp; My bet is that, BYD excluded, all of these companies will be bankrupt by the end of 2025. Tesla will survive.&nbsp;","text":"Today the kids and I went for a walk and we played a game of spot- the-EVs. 11 Teslas, a Nissan Leaf which barely qualifies as a real car, and a Toyota which shouldn't have been on the list because it's a hybrid but we felt sorry for them. My bet is that, BYD excluded, all of these companies will be bankrupt by the end of 2025. Tesla will survive.","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":6,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/232871521169648","repostId":"2376243284","repostType":2,"repost":{"id":"2376243284","kind":"highlight","pubTimestamp":1697856446,"share":"https://ttm.financial/m/news/2376243284?lang=&edition=fundamental","pubTime":"2023-10-21 10:47","market":"sh","language":"en","title":"7 Next-Gen EV Stocks That Can Beat Tesla Hands Down","url":"https://stock-news.laohu8.com/highlight/detail?id=2376243284","media":"InvestorPlace","summary":"The chosen companies generally are experiencing rapid growth and have some type of advantage in the EV space. Because the market is very potent and also very competitive, companies with strong financials and a upper edge in innovation are likely to last and dominate in the rapidly growing EV market.","content":"<html><head></head><body><p>Finding the best EV stocks to buy in this market is a real challenge.</p><p>This is a high growth potential market as both consumers and governments are favoring EVs over gas-fueled cars. Last quarter alone, more than 300,000 EVs were sold in the U.S., showing the growing increase in demand for environmentally friendly vehicles and boding well for the best EV stocks.</p><p>By 2030, we are expected to see over 125 million EVs on the road globally, which is a drastic increase from 26 million last year.</p><p>While the competition is fierce in the market, the continuously rising demand for EVs still leaves EVs companies with a high growth potential. Below are some of the seven best EV stocks.</p><h2 id=\"id_1464499958\">Li Auto Inc (LI)</h2><p><strong>Li Auto </strong>(NASDAQ: <strong><u>LI</u></strong>) is one of the emerging powerhouses in the Chinese electric vehicle market — currently, it specializes in premium quality electric SUVs.</p><p>The company has drawn headlines for a stellar year-over-year increase in sales volume of 663.8%, delivering 34,914 vehicles in August 2023. This rapid growth can be attributed to the company’s commendable business model of filling a niche in the EV industry for family-oriented EV cars with extended range capabilities.</p><p>While Li Auto’s stock price has dipped moderately since its peak of $46.65 per share, the company’s solid financials make it a relatively safe long-term option for traders.</p><p>Li Auto is projected to reach $4.59 billion of sales next financial quarter compared to $4.08 billion in sales this quarter, which is a safe bet considering its track record for beating sales estimates every month in the past fiscal year.</p><p>Over the next five years, analysts expect Li Auto’s earnings to increase at a compounded rate of 75%, and this high projected growth is backed by a low debt-to-equity ratio of just 0.03, and a solid cash reserve of $10.2 billion.</p><p>The overall electric vehicle industry in China is projected by Bank of America Securities to grow 27% this year, and with Li Auto filling a pivotal need amongst the Chinese consumer base, expect Li Auto to become a cornerstone of many traders’ portfolios in the months to come.</p><h2 id=\"id_511176564\">BYD Company (BYDDY)</h2><p>Chinese company <strong>BYD</strong> (OTCMKTS: <strong><u>BYDDY</u></strong>) has recently taken the lead over famed EV producer Tesla in global market share, holding over 21%.</p><p>This development follows a long price war in the Chinese market with Tesla, with both reporting record-breaking sales for the second fiscal quarter.</p><p>BYD holds an edge in the EV industry because of its business model which implements vertical integration.</p><p>BYD is the leading producer of lithium ion rechargeable batteries, and has a fully integrated supply chain spanning lithium mines, lithium processing, battery production, and an in-house computer chip unit.</p><p>BYD’s stock has been rising steadily since December 2022, supported by strong moving averages and recent breakout patterns.</p><p>Its recent move above $33.94, along with solid support at $31.5, reflects a positive market sentiment. The breakout from a pennant pattern indicates potential upward momentum, making it an opportune time for investors to consider entry.</p><p>With strong fundamentals and favorable technical indicators, BYD appears promising in the thriving EV market. BYD is by far one of the best EV companies.</p><h2 id=\"id_3676156707\">XPeng (XPEV)</h2><p><strong>XPeng</strong> (NYSE: <strong><u>XPEV</u></strong>) is a Chinese EV manufacturing company headquartered in Guangzhou with multiple main offices located in major cities overseas.</p><p>XPeng announced that the company delivered more than 15,000 Smart EVs last month alone, which was a 12% increase from August and 81% increase year-over-year.</p><p>Furthermore, XPeng recently delivered 750 of its vehicles to Israel, which was the largest single batch of exports for the year.</p><p>Despite facing regulations abroad, specifically in Europe and the United States, the Chinese EV maker seems adamant on expanding its operations in Israel, and potentially the larger Middle East market.</p><p>XPeng’s partnership with local Israeli partner Freesbe highlights the company’s ability to produce customized vehicles that match the preferences of buyers in markets abroad.</p><p>It is also important to note that over 60% of all EV sales in Israel were by Chinese manufacturers.</p><p>XPeng has been trying to expand beyond its domestic Chinese market, which is evident from its recent shipment to Israel. As the company continues to expand both domestically and internationally, XPeng seems to showcase high growth potential in the EV market.</p><h2 id=\"id_2980415720\">Rivian Automotive Inc (RIVN)</h2><p>When <strong>Rivian</strong> (NASDAQ: <strong><u>RIVN</u></strong>) went public in Q4 of 2021, it recorded one of the highest U.S. IPOs ever, with the company raising almost $12 billion.</p><p>However, the company delivered an underwhelming number of its electric trucks or SUVs after going public, and their stock plummeted from IPO at $78 to its current price of about $17.</p><p>Despite underperformance in recent years, the forecast for Rivian is quite promising. Rivian expects its production to find stability as it increases the production of its in-house Enduro drive unit and reduce its current reliance on third-party power trains.</p><p>This naturally lowers Rivian’s total production costs. Between Q2 of last year to Q2 of this year, the company’s gross margin significantly improved from negative 193% to negative 37%.</p><p>While the company has much progress to make in order to break even, its margin will continue to improve as it replaces more of its third-party components to its own productions.</p><p>Rivian has been developing its own operating system and chips, which helps the company differentiate itself from its competitors and offers freedom from future supply chain disruptions.</p><h2 id=\"id_241508553\"><a href=\"https://laohu8.com/S/LVWR\">LiveWire</a> Group (LVWR)</h2><p><strong>LiveWire</strong> (NYSE: <strong><u>LVWR</u></strong>) is a division of Harley Davidson that specializes in the production of electric motorcycles.</p><p>The company went public just about a year ago, making it the first publicly traded electric motorcycle company in the United States. The current electric motorbikes market stands at $50.3 billion, but according to Statista, this global market could double by 2030.</p><p>LiveWire, which competes in the high-performance segment, is currently growing at 27% annually. Besides a growing electric motorcycle market internationally, the company’s gross margin improved from 30.9% to 34.9%. </p><p>In the second quarter of 2023, LiveWire activated a network of 35 retail partners in France, the United Kingdom, Germany, and the Netherlands to expand on the European hybrid market.</p><p>One of its most popular models, the LiveWire One, became available in Europe in the second quarter and announced the second edition of its more affordable model, the S2 Del Mar, to attract a wider range of motorcycle riders.</p><h2 id=\"id_221117285\"><a href=\"https://laohu8.com/S/LCID\">Lucid Group Inc</a> (LCID)</h2><p><strong>Lucid Group Inc</strong> (NASDAQ: <strong><u>LCID</u></strong>) is an American electric vehicle manufacturer that specializes in premium sports automobiles.</p><p>Since its launch in 2021, the company has branded itself as “luxury electric cars” to gain a competitive edge in the fierce EV market.</p><p>Lucid’s first vehicle, the Lucid Air, has won several awards such as 2023 World Luxury Car at the World Car Awards and the Best Luxury Electric Car in <em>U.S. News &amp; World Report</em>.</p><p>Even though these awards do not make Lucid a successful business, it does prove that its vehicles are top-quality products that could compete against well-established EVs like Tesla. </p><p>On top of its proven vehicle quality, Lucid Group’s revenue grew 55% from the second quarter last year to Q2 of 2023, and this number is expected to rise as the company expands its customer base.</p><p>The rising number of units delivered to new customers will help Lucid achieve economies of scale, reducing its total costs and improving its margins.</p><h2 id=\"id_2977613155\">Nio Inc (NIO)</h2><p>A problem with <strong>Nio</strong> (NYSE: <strong><u>NIO</u></strong>) has been supply chains. Supply chain issues have plagued Nio, lowering their production and slowing down their growth.</p><p>Recently, their supply chains have drastically improved, as they are ramping up production and experiencing few problems with production. A massive bullish factor about Nio is its rapid revenue growth.</p><p>In the third quarter, the company is expected to produce around 56,000 vehicle deliveries, which marks a year-over-year increase greater than 75%. Its revenue is also expected to grow, seeing an increase of over 40% year-over-year.</p><p>Nio is also bringing about innovation in the EV space, providing a battery-as-a-service subscription. Also, Nio recently developed Nio NT 2.9, a platform with an improved advanced drive assistant system which is attractive to buyers. Although the company is expected to lose a considerable amount of money this year, it has large cash reserves which will be able to cover its losses and facilitate its growth. </p><p>Nio also plans to diversify its business model, using its vast resources to create its own smartphones. Their first phone will be called the Nio phone, and although it’s not expected to perform well in markets like the US, it has significant potential in China, where the company is based. </p></body></html>","source":"investorplace_stock_picks","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>7 Next-Gen EV Stocks That Can Beat Tesla Hands Down</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\n7 Next-Gen EV Stocks That Can Beat Tesla Hands Down\n</h2>\n\n<h4 class=\"meta\">\n\n\n2023-10-21 10:47 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://investorplace.com/2023/10/7-next-gen-ev-stocks-that-can-beat-tesla-hands-down/><strong>InvestorPlace</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Finding the best EV stocks to buy in this market is a real challenge.This is a high growth potential market as both consumers and governments are favoring EVs over gas-fueled cars. Last quarter alone,...</p>\n\n<a href=\"https://investorplace.com/2023/10/7-next-gen-ev-stocks-that-can-beat-tesla-hands-down/\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"81211":"比亚迪股份-R","01211":"比亚迪股份","BYDDY":"比亚迪ADR","LI":"理想汽车","NIO.SI":"蔚来","02015":"理想汽车-W","09868":"小鹏汽车-W","RIVN":"Rivian Automotive, Inc.","XPEV":"小鹏汽车","002594":"比亚迪","09866":"蔚来-SW","NIO":"蔚来","LVWR":"LiveWire","LCID":"Lucid Group Inc"},"source_url":"https://investorplace.com/2023/10/7-next-gen-ev-stocks-that-can-beat-tesla-hands-down/","is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"2376243284","content_text":"Finding the best EV stocks to buy in this market is a real challenge.This is a high growth potential market as both consumers and governments are favoring EVs over gas-fueled cars. Last quarter alone, more than 300,000 EVs were sold in the U.S., showing the growing increase in demand for environmentally friendly vehicles and boding well for the best EV stocks.By 2030, we are expected to see over 125 million EVs on the road globally, which is a drastic increase from 26 million last year.While the competition is fierce in the market, the continuously rising demand for EVs still leaves EVs companies with a high growth potential. Below are some of the seven best EV stocks.Li Auto Inc (LI)Li Auto (NASDAQ: LI) is one of the emerging powerhouses in the Chinese electric vehicle market — currently, it specializes in premium quality electric SUVs.The company has drawn headlines for a stellar year-over-year increase in sales volume of 663.8%, delivering 34,914 vehicles in August 2023. This rapid growth can be attributed to the company’s commendable business model of filling a niche in the EV industry for family-oriented EV cars with extended range capabilities.While Li Auto’s stock price has dipped moderately since its peak of $46.65 per share, the company’s solid financials make it a relatively safe long-term option for traders.Li Auto is projected to reach $4.59 billion of sales next financial quarter compared to $4.08 billion in sales this quarter, which is a safe bet considering its track record for beating sales estimates every month in the past fiscal year.Over the next five years, analysts expect Li Auto’s earnings to increase at a compounded rate of 75%, and this high projected growth is backed by a low debt-to-equity ratio of just 0.03, and a solid cash reserve of $10.2 billion.The overall electric vehicle industry in China is projected by Bank of America Securities to grow 27% this year, and with Li Auto filling a pivotal need amongst the Chinese consumer base, expect Li Auto to become a cornerstone of many traders’ portfolios in the months to come.BYD Company (BYDDY)Chinese company BYD (OTCMKTS: BYDDY) has recently taken the lead over famed EV producer Tesla in global market share, holding over 21%.This development follows a long price war in the Chinese market with Tesla, with both reporting record-breaking sales for the second fiscal quarter.BYD holds an edge in the EV industry because of its business model which implements vertical integration.BYD is the leading producer of lithium ion rechargeable batteries, and has a fully integrated supply chain spanning lithium mines, lithium processing, battery production, and an in-house computer chip unit.BYD’s stock has been rising steadily since December 2022, supported by strong moving averages and recent breakout patterns.Its recent move above $33.94, along with solid support at $31.5, reflects a positive market sentiment. The breakout from a pennant pattern indicates potential upward momentum, making it an opportune time for investors to consider entry.With strong fundamentals and favorable technical indicators, BYD appears promising in the thriving EV market. BYD is by far one of the best EV companies.XPeng (XPEV)XPeng (NYSE: XPEV) is a Chinese EV manufacturing company headquartered in Guangzhou with multiple main offices located in major cities overseas.XPeng announced that the company delivered more than 15,000 Smart EVs last month alone, which was a 12% increase from August and 81% increase year-over-year.Furthermore, XPeng recently delivered 750 of its vehicles to Israel, which was the largest single batch of exports for the year.Despite facing regulations abroad, specifically in Europe and the United States, the Chinese EV maker seems adamant on expanding its operations in Israel, and potentially the larger Middle East market.XPeng’s partnership with local Israeli partner Freesbe highlights the company’s ability to produce customized vehicles that match the preferences of buyers in markets abroad.It is also important to note that over 60% of all EV sales in Israel were by Chinese manufacturers.XPeng has been trying to expand beyond its domestic Chinese market, which is evident from its recent shipment to Israel. As the company continues to expand both domestically and internationally, XPeng seems to showcase high growth potential in the EV market.Rivian Automotive Inc (RIVN)When Rivian (NASDAQ: RIVN) went public in Q4 of 2021, it recorded one of the highest U.S. IPOs ever, with the company raising almost $12 billion.However, the company delivered an underwhelming number of its electric trucks or SUVs after going public, and their stock plummeted from IPO at $78 to its current price of about $17.Despite underperformance in recent years, the forecast for Rivian is quite promising. Rivian expects its production to find stability as it increases the production of its in-house Enduro drive unit and reduce its current reliance on third-party power trains.This naturally lowers Rivian’s total production costs. Between Q2 of last year to Q2 of this year, the company’s gross margin significantly improved from negative 193% to negative 37%.While the company has much progress to make in order to break even, its margin will continue to improve as it replaces more of its third-party components to its own productions.Rivian has been developing its own operating system and chips, which helps the company differentiate itself from its competitors and offers freedom from future supply chain disruptions.LiveWire Group (LVWR)LiveWire (NYSE: LVWR) is a division of Harley Davidson that specializes in the production of electric motorcycles.The company went public just about a year ago, making it the first publicly traded electric motorcycle company in the United States. The current electric motorbikes market stands at $50.3 billion, but according to Statista, this global market could double by 2030.LiveWire, which competes in the high-performance segment, is currently growing at 27% annually. Besides a growing electric motorcycle market internationally, the company’s gross margin improved from 30.9% to 34.9%. In the second quarter of 2023, LiveWire activated a network of 35 retail partners in France, the United Kingdom, Germany, and the Netherlands to expand on the European hybrid market.One of its most popular models, the LiveWire One, became available in Europe in the second quarter and announced the second edition of its more affordable model, the S2 Del Mar, to attract a wider range of motorcycle riders.Lucid Group Inc (LCID)Lucid Group Inc (NASDAQ: LCID) is an American electric vehicle manufacturer that specializes in premium sports automobiles.Since its launch in 2021, the company has branded itself as “luxury electric cars” to gain a competitive edge in the fierce EV market.Lucid’s first vehicle, the Lucid Air, has won several awards such as 2023 World Luxury Car at the World Car Awards and the Best Luxury Electric Car in U.S. News & World Report.Even though these awards do not make Lucid a successful business, it does prove that its vehicles are top-quality products that could compete against well-established EVs like Tesla. On top of its proven vehicle quality, Lucid Group’s revenue grew 55% from the second quarter last year to Q2 of 2023, and this number is expected to rise as the company expands its customer base.The rising number of units delivered to new customers will help Lucid achieve economies of scale, reducing its total costs and improving its margins.Nio Inc (NIO)A problem with Nio (NYSE: NIO) has been supply chains. Supply chain issues have plagued Nio, lowering their production and slowing down their growth.Recently, their supply chains have drastically improved, as they are ramping up production and experiencing few problems with production. A massive bullish factor about Nio is its rapid revenue growth.In the third quarter, the company is expected to produce around 56,000 vehicle deliveries, which marks a year-over-year increase greater than 75%. Its revenue is also expected to grow, seeing an increase of over 40% year-over-year.Nio is also bringing about innovation in the EV space, providing a battery-as-a-service subscription. Also, Nio recently developed Nio NT 2.9, a platform with an improved advanced drive assistant system which is attractive to buyers. Although the company is expected to lose a considerable amount of money this year, it has large cash reserves which will be able to cover its losses and facilitate its growth. Nio also plans to diversify its business model, using its vast resources to create its own smartphones. Their first phone will be called the Nio phone, and although it’s not expected to perform well in markets like the US, it has significant potential in China, where the company is based.","news_type":1},"isVote":1,"tweetType":1,"viewCount":525,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0}],"lives":[]}