To The Moon

Let's recollect and see what the price of Tesla (TSLA) was on 6th January 2023:

It was at US$101.81 - decisiveness is when you see the news and the multi-year low statements and buy Tesla shares.

I did. But now spring forth to 1st November 2023 - I sold some at the height of US$280 and now still keeping only a few.

So here were the January reports on Tesla:

The start of 2023 was a brutal one for Tesla (TSLA) investors, with the stock again hitting multi-year lows.

Coming after a truly hellish 2022, Tesla investors are looking for anything positive to grasp on that could be considered bullish.

But they are not going to get anything bullish, at least from a technical point of view at the moment.

Tesla "remains strongly bearish near-term, and despite being oversold, has not shown evidence of having bottomed out,” said Mark Newton, Head of Technical Strategy at Fundstrat in a note to clients yesterday. “Based on a combination of daily and weekly cycles...I believe TSLA still has the potential to weaken to under 100 into its January 2023 earnings before any stabilization and bounce.”

Using tools like daily RSI (relative strength index) and TD Sequential, Newton surmises that Tesla "likely will be higher the first six months of the year, before weakening into Fall 2023.” (He does, tough, see short term weakness in March as well.)

While Newton's analysis is heavily technical, it outlines additional challenges facing Tesla bulls in addition to fundamental issues like demand concerns, or continued distractions from CEO Elon Musk and his Twitter foray.

Historic Tesla News

Tesla A Monster Stock Over Much Of Its History

Almost single-handedly, Musk has turned the auto industry on its head, essentially forcing it to get aboard the electric-vehicle train.

It's a reason why Tesla has been a monster stock over much of its history, especially during its stratospheric run from mid-2019 to late 2021. The stock hit a bear market low of 101.84 on Jan. 6, but roared back until Q1 earnings.

On April 19, Tesla reported a big first-quarter earnings decline while revenue missed views. Profit margins for the global EV giant also fell below 20% as the company executed an aggressive price-slashing strategy in the first part of 2023.

Tesla reported revenue increasing 24% to $23.33 billion with EPS of 85 cents, a 20% decline compared to 2022.

The EV company's total gross profit came in at $4.5 billion, with Tesla's profit gross margin at 19.3%, down from 23.8% in Q4 and 29.1% a year earlier.

Tesla's Global Price Cutting Strategy

Throughout 2023, Tesla has slashed prices worldwide multiple times, starting in January and continuing into April. For much of the first part of the year, the only exception was China, where Tesla cut prices significantly in late October before reductions in early January.

However, now the new Model 3 is on pre-sale in China with prices starting at about $35,850, 12% more vs. the old version. Deliveries are expected to begin in Q4. The new Model 3 will go on sale in Europe in October.

Meanwhile, in the U.S. Tesla has removed its standard range Model S and Model X versions in the U.S. and dropped the price of the Model X all-wheel drive version below $80,000. This now makes the Model X eligible for the federal $7,500 tax credit under the Inflation Reduction Act (IRA), confirmed by the Internal Revenue Service on September 6.

Ahead of releasing the revamped Model 3 in China, Tesla on August 13 cut prices on two Model Y vehicle trims and began offering a limited-time insurance subsidy for the older Model 3.

On August 16, Tesla fired another shot in the EV price war, nearly doubling discounts on its luxury Model S and Model X vehicles in China.

Earlier in the year, Tesla reduced prices in several European markets. Tesla also dropped the price of its electric vehicles in Israel and Singapore in order to increase demand, expanding a worldwide discount push that began in China in January.

Tesla Stock: Betting On Autonomous Vehicles And The Cybertruck

Musk is betting big on the Cybertruck and autonomous vehicle technology, along with a possible tailwind from the Inflation Reduction Act (IRA).

Musk has long touted Tesla's Full Self-Driving (FSD) technology and the potential value it brings to the brand.

Reports have emerged Tesla has started rolling out its FSD beta for new vehicles equipped with Hardware 4, the company's newest computer system that contains more ports for data-collecting cameras.

The move comes after Elon Musk live-streamed 45-minutes of himself on Aug. 25 using "FSD v12 beta" to drive around Palo Alto. Musk had to make an "intervention" one time during the drive, when his vehicle tried to run a red light.

On Sept. 1, Tesla reduced the price of FSD in the U.S. to $12,000, down from $15,000.

Meanwhile, on Aug. 24 Reuters reported that the National Highway Traffic Safety Administration (NHTSA) says it's close to ending its two-year long investigation of Tesla's driver-assist systems Autopilot and Full-Self Driving.

However it's unclear if NHTSA regulators will take significant action against the EV giant.

NHTSA in late July sought more information about Tesla's self-driving monitoring systems, according to reports. Specifically, regulators wanted to know more about the "Elon mode," in which some people, including Musk, have disabled the driver monitoring or alerts while self-driving.

In his livestream FSD ride, Musk frequently looked at his phone, but got no nags to pay attention to the road.

Cybertruck Hype

Meanwhile, a Cybertruck delivery event is expected to take place before the end of 2023. The Cybertruck will be the EV maker's first new passenger vehicle since the Model Y launched in early 2020. Tesla observers in late August estimate initial Cybertruck production at Gigafactory Texas to be around 100 units.

However, Tesla still hasn't released prices or key specs that would affect Cybertruck demand and profitability. It's still unclear how close Tesla is to mass production, or even if it's settled on a final production model.

Elon Musk said during the Q2 earnings call that Tesla would hold a Cybertruck delivery event before year-end, but has since hedged.

"It is an extremely difficult product to build," Musk recently wrote on X. "We are in uncharted territory, because it is not like anything else."

On July 15, Tesla posted a photo to X of the first Tesla Cybertruck made at its Austin plant. Tesla stock responded jumping 3.2%.

The company also said it continues to "make progress" on its next generation platform. Since the Tesla investor day in early March, the company has remained mostly silent on its next generation vehicle, which has been said will be produced at its new plant in Mexico. At the annual shareholder meeting, Tesla teased a vehicle silhouette.

The Long-Awaited Semi Hauler Unveiled

In early December, Tesla unveiled its long-awaited Semi, an 18-wheel, long-haul electric freight truck, five years after it was first announced. However, in March, Tesla ordered a voluntary recall of 35 Semi trucks due to a parking brake issue.

Tesla began delivering its long-haul Semi trucks to PepsiCo (PEP) in December. Further, Musk has indicated there are plans to build out a charging network for long-haul trucks.

Musk did not specify how much the eighteen-wheeler costs. The Semi is capable of traveling an estimated 500 miles per charge. It can accelerate from zero to 60 in 20 seconds, Tesla says. The company expects to ramp production over the next year and aims to deliver 50,000 units in 2024.

Before the recall, PepsiCo planned to deploy 36 Tesla Semi trucks, with 15 in Modesto and 21 in Sacramento.

Pepsi placed its order for 100 EVs when the Semi was first announced in 2017.

Is Tesla Stock A Buy?

On September 22, Tesla stock dropped more than 4% to 244.88. In total last week, Tesla tumbled nearly 11%, skidding below its 50-day line.

The shares also round-tripped all of the prior week's gains spurred by a bullish Morgan Stanley call on the EV maker's supercomputer and self-driving prospects.

Tesla stock has a proper cup-with-handle base, giving it a 278.98 buy point, according to MarketSmith analysis.

Meanwhile, Ferragu in his note wrote that a Q3 delivery miss will not be a "positive catalyst" for Tesla stock and that investors may have to wait until Q4.

Tesla stock ranks fourth in the 35-stock IBD automaker industry group. The S&P 500 component has a 95 Composite Rating out of 99. Shares have an 91 Relative Strength Rating and its EPS Rating is 93 out of 99.

The market status is showing "market in correction." Tesla stock is around 12% below its official entry point and is not a buy right now.