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Tesla Stock Is Rising. Here's What's Moving Shares

Dow Jones09-30

Tesla Motors stock rose early Monday, despite another profit warning from another auto maker which hammered shares of Tesla's traditional peers.

Shares of the electric-vehicle maker were up 1.4% after the market opened for trading, while the S&P 500 and Dow Jones Industrial Average were both about 0.2%.

The move comes after Stellantis shares dropped 12.5% to $14.06 after cutting its full-year financial guidance. The Chrysler parent now expects operating profit margins of 5.5% to 7%, down from prior guidance for "double digits." Free cash flow is expected to be negative 5 billion euros ($5.6 billion) to 10 billion euros ($11.2 billion), while prior guidance projected "positive" free cash flow for 2024.

Lower wholesale shipments in North America and increased Chinese competition were reasons cited for the cut.

Neither issue is a shock. In recent guidance cuts, auto makers Volkswagen and Mercedes-Benz cited a weakening Chinese market. What's more, Stellantis had a very difficult first half in the U.S., leaving dealer inventories elevated. Sales were down about 16% year over year.

Still, investors are taking the magnitude of the cut hard. Stellantis was dragging down the sector. Shares of General Motors and Ford Motor were down 2.6% and 2.5%, respectively.

Stellantis' woes may not mean as much to Tesla investors ahead of the EV firm's Robotaxi Day, scheduled for Oct. 10, when the company will provide some details about an upcoming self-driving taxi service.

Barclays analyst Dan Levy wrote Monday that it could be a "sell the news" event. Tesla stock has been exceptionally strong lately, in the run-up to Robotaxi Day. Coming into Monday trading, shares have gained about 24% over the past month, rising for three consecutive weeks.

The strength is a sign that most Robotaxi-related news is already reflected in Tesla stock.

Recent gains left shares up about 5% year to date and up more than 85% from 2024 lows in mid-April.

Levy rates Tesla shares at Hold with a $220 price target.

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Comment1

  • a4xrbj1
    ·10-01
    It's all a pipe dream. There won't be a 25k car and Robotaxis from Tesla won't be on the road fully autonomously for years. They will do the Waymo approach, with a human supervisor and in a geofenced area (pending regulatory approval). It can't be that only Stellantis is hurt in the US, Tesla sales will be hurt as well with all the negativity around Musk political play and stronger competition (though still not many Chinese EV's which would destroy the US car makers).
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    • DouglasFong
      Would you trust a search engine provider or a car manufacturer to make your cars? 😅
      10-02
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    • Dr Rck
      At that kind of speed and coverage TSLA has, prob TSLA needs that kind of intervention for safety before fully implementing FSD, I think consumers trust TSLA being a car manufacturer than what Google has or Waymo so to speak?
      10-02
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    • a4xrbj1
      It doesn’t work in heavy fog (check YouTube, system shuts off) because it has no LiDAR/Radar. But you do understand that FSD has an intervention every 13 miles vs Waymo 17,311 and Zoox 177,602 miles.


      It’s a level 2 ADAS system, that’s nowhere close to a Robotaxi!
      10-02
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