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Tesla: Why I'm Buying The Dip

Statement of Operations Statements of operations The first factor is the abnormally sizeable regulatory credit income used last quarter . This amount seems like a record for the company, implying that Tesla is now going through a "challenging" phase. Why is

Tesla: Why I'm Buying The Dip

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{"i18n":{"language":"en_US"},"data":{"magic":2,"id":331619140804832,"tweetId":"331619140804832","gmtCreate":1721969417482,"gmtModify":1721969421245,"author":{"id":3576491506830909,"idStr":"3576491506830909","authorId":3576491506830909,"authorIdStr":"3576491506830909","name":"Thuy","avatar":"https://static.tigerbbs.com/22ff27289c1cbcb78ab3ddb6161da9d6","vip":1,"userType":1,"introduction":"","boolIsFan":false,"boolIsHead":false,"crmLevel":1,"crmLevelSwitch":0,"individualDisplayBadges":[],"fanSize":1,"starInvestorFlag":false},"themes":[],"images":[],"coverImages":[],"html":"<html><head></head><body>Hope it will be up next week 🙏</body></html>","htmlText":"<html><head></head><body>Hope it will be up next week 🙏</body></html>","text":"Hope it will be up next week 🙏","highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"link":"https://ttm.financial/post/331619140804832","repostId":2454802458,"repostType":2,"repost":{"id":"2454802458","pubTimestamp":1721964838,"share":"https://www.laohu8.com/m/news/2454802458?lang=&edition=full","pubTime":"2024-07-26 11:33","market":"us","language":"en","title":"Tesla: Why I'm Buying The Dip","url":"https://stock-news.laohu8.com/highlight/detail?id=2454802458","media":"seekingalpha","summary":"Statement of Operations Statements of operations The first factor is the abnormally sizeable regulatory credit income used last quarter . This amount seems like a record for the company, implying that Tesla is now going through a \"challenging\" phase. Why is","content":"<html><head></head><body><ul style=\"\"><li>Tesla, Inc. stock was unjustly demolished after its earnings announcement.</li><li>The mini-crash represents a considerable buying opportunity.</li><li>Future growth potential in energy generation, new products, and services, including the robotaxi business.</li><li>Despite temporary weakness, Tesla remains a strong buy in the long term with future growth potential in various segments.</li></ul><img src=\"https://community-static.tradeup.com/news/dfa04f25194b53624836b350ecbfc7bd\" tg-width=\"509\" tg-height=\"339\"/>Brandon Woyshnis/iStock Editorial via Getty ImagesI recently wrote about Tesla, Inc. (NASDAQ:TSLA) being a long-term buy despite the significant run-up. To be fair - I indicated that despite being an intermediate and long-term buy, Tesla had become incredibly overbought in the near term and was likely due for a considerable correction.Fast-forward two weeks, and we received a remarkable buying opportunity. Tesla&#39;s earnings failed to please near-term-focused investors and the stock tumbled, with the downside now exacerbated by Wall Street&#39;s general risk-off theme.Despite this transitory weakness, Tesla remains a strong buy, especially in the intermediate and long term. The market is overreacting to temporary weakness in automotive sales margins.Investors should focus more on the long-term image, such as future improvements in Tesla&#39;s automotive sector and the strong pipeline of products and services that will likely contribute considerably to Tesla&#39;s sales and profitability growth in future years.<h2 id=\"id_4141590136\">Tesla - Remarkable Buying Opportunity</h2><img src=\"https://community-static.tradeup.com/news/e0be49f77e4235a8a2703b5d0e17f7fe\" tg-width=\"640\" tg-height=\"676\"/>TSLAI warned against chasing the stock after the massive run-up and was relatively cautious going into earnings because of the overheated technical conditions and near-term uncertainties. I purchased most of my recent shares in the $140-180 area and added more in yesterday&#39;s decline. We&#39;ve also discussed that Tesla may close the $220-210 gap and possibly overshoot to $200 in a bearish case selloff.Tesla&#39;s stock is on track to achieve these objectives, creating an excellent intermediate and long-term buying opportunity. Technically, Tesla&#39;s stock is no longer overbought, but could soon become oversold. The RSI is approaching the 30-40 level, and the full stochastic could dip below 20 soon. The 50-day MA is about to cross the 200-day, implying an improvement in Tesla&#39;s stock&#39;s momentum. While Tesla&#39;s stock remains volatile, it could even out and continue its recently started long-term uptrend.<h2 id=\"id_628656928\">Tesla Earnings - Market Overreaction</h2>In my pre-earnings Tesla article, I predicted $25B in revenues, $4.55B in gross profit, an 18.2% gross profit margin, and $0.46 in GAAP EPS. Tesla reported $25.5B in revenues, $4.578B in gross profit, an 18% gross margin, and $0.46 in GAAP EPS. Technically, Tesla&#39;s results were not much worse, and in some areas, better than I envisioned. So, then, where did Tesla go wrong?<h3 id=\"id_131002280\">Statement of Operations</h3><img src=\"https://community-static.tradeup.com/news/ae53d7292fddb6be4283184d2dd939db\" tg-width=\"640\" tg-height=\"336\"/>Statements of operationsThe first factor is the abnormally sizeable regulatory credit income used last quarter ($890M). This amount seems like a record for the company, implying that Tesla is now going through a &#34;challenging&#34; phase.<h3 id=\"id_972784182\">Why is this period challenging, you may ask?</h3>Several key factors are at play here, but the good news is that they all appear transitory. First, we have a relatively sluggish global economy with high interest rates. This environment is not great for EVs, as financing costs are relatively high and demand is lackluster.Second, there is a general glut concerning the EV segment. Growth has been so explosive during the past five years that the global market has become oversaturated with EVs. ICE vehicles are making a comeback (temporarily, likely), especially with relatively cheap oil prices now.However, the EV revolution is likely on hold; it&#39;s still ongoing, and demand should increase as the economy improves, rates decline, and the market becomes less saturated with EVs.Third, increased competition has sprung up everywhere. On the one hand, there are Chinese EV makers. Then there are the legacy automakers, such as Americans, Germans, Koreans, and others, who are making EVs. Of course, this dynamic is healthy for the overall market, but it&#39;s causing Tesla&#39;s growth to slow and forcing Tesla to decrease prices on its EVs.Fourth, margin compression is occurring for several reasons. Tesla has decreased prices, but it is also going through costly ramp-up processes with the Cybertruck and the redesigned Model 3. If we exclude regulatory credit revenue, Tesla&#39;s automotive sales gross margin was only about 14% last quarter, the lowest in years.Fifth, Tesla had a $622M &#34;restructuring and other&#34; charge last quarter (likely due to mass layoffs). Without this one-time charge, Tesla&#39;s normalized (non-GAAP) EPS would have been around $0.70 instead of $0.52.<h2 id=\"id_1851456672\">Look On The Bright Side And Keep A Long-Term Outlook</h2>Tesla&#39;s operating costs were lower than expected, R&amp;D spending was less than in the previous three quarters, and SG&amp;A expenses were lower than in the last two quarters. Furthermore, Tesla finished the quarter with a massive $30.7B cash position, a sequential increase of $3.9B.Tesla&#39;s energy generation and storage business is booming and being overlooked. Sales totaled over $3B last quarter, up about 88% sequentially. The gross margin here is almost 25%. Tesla&#39;s energy business will likely continue expanding and become increasingly profitable with scale.The &#34;services and other segment&#34; continues improving, with over $2.6B in sales last quarter. Profitability here is also improving, and services/others could continue expanding and become increasingly profitable.The Model 3/Y ASPs are dirt cheap right now. Tesla&#39;s automotive sales were only $18.53B last quarter. I deduced that Tesla sold around 414,000 Model 3/Ys the previous quarter and roughly 21,335 &#34;other vehicles.&#34;My ASP projections were a bit high-$110K for other vehicles and $41K for the Model 3/Y segment. In reality, Tesla likely had ASPs closer to $100K for its other cars or around $2.14B in sales.This dynamic implies that Tesla&#39;s Model 3/Y segment generated about $16.4B in revenues last quarter, equating to approximately $39.6K in ASP. Tesla has already begun raising prices on its Model Y in the U.S., with more price hikes ahead (likely).New products and services are in the pipeline. Tesla&#39;s Model 2 is scheduled to arrive next year. If you think Model 3/Y sales are fantastic (1.5-2M annually), wait until the Model 2 arrives. With an ASP of around $40K for the Model 3, the Model 2 would stand out at around $30-32K.This price point would open up a whole new market for Tesla, where it could compete with cheaper Chinese EVs and mass market leaders like the Toyota Corolla, Honda Civic, and many other mainstream cars. Tesla could sell 1-2M Model 2s annually, enabling another $30-60B in revenues for the EV giant.Get ready for the future. Uber and Lyft stocks have been struggling for a reason: Tesla&#39;s robotaxi business could take considerable market share in future years. Many analysts believe the robotaxi business will be massive for Tesla, and some people like Cathy Woods cite it as one of the primary catalysts for massive price targets in future years.The fund manager expects Tesla to be around $2,600 in five years. Yes, that&#39;s about a 1,000% upside from here, and it could make Tesla the most valuable company globally. If you think this is far-fetched, don&#39;t, because robotaxis is already available in China and San Francisco, LA, Las Vegas, and other areas. It&#39;s the future of taxi travel, and Tesla is in a prime position because of its car business, AI, and FSD.<h2 id=\"id_2067375192\">The Bottom Line</h2>As the global economy improves and interest rates decrease, demand for EVs should rebound, enabling Tesla to raise vehicle prices. Moreover, Tesla remains the technological innovator and leader in the EV segment and is essentially the industry&#39;s gold standard, as far as I am concerned. Therefore, Tesla&#39;s automotive sales and margins should rebound and improve more than anticipated in future quarters.Moreover, Tesla&#39;s Cybertruck ramp-up and its redesign projects should become less cost-intensive, and gross profitability should increase in its automotive segment. Furthermore, Tesla should continue benefiting from its growing and highly profitable energy generation and storage business.Additionally, Tesla&#39;s future projects, such as the robotaxi, FSD technology, AI, robotics, and other segments, should diversify its revenue considerably, enabling its overall margins to increase over time. We should also see Tesla&#39;s automotive sales margins improving and potentially returning to 17% or higher as the economy normalizes, production costs decrease, and ASPs rise.This is a &#34;low point&#34; for Tesla, and there is a high probability that we could see considerable improvements in future quarters, which should raise Tesla&#39;s stock price. My 12-to 18-month price target for Tesla remains $500, and the stock can go considerably higher after that.What Tesla&#39;s financials may look like in the future:<table style=\"border-collapse:collapse;\"><tbody><tr><td style=\"text-align:left;\">The Year</td><td style=\"text-align:left;\">2024</td><td style=\"text-align:left;\">2025</td><td style=\"text-align:left;\">2026</td><td style=\"text-align:left;\">2027</td><td style=\"text-align:left;\">2028</td><td style=\"text-align:left;\">2029</td><td style=\"text-align:left;\">2030</td></tr><tr><td style=\"text-align:left;\">Revenue Bs</td><td style=\"text-align:left;\">$106</td><td style=\"text-align:left;\">$140</td><td style=\"text-align:left;\">$175</td><td style=\"text-align:left;\">$215</td><td style=\"text-align:left;\">$265</td><td style=\"text-align:left;\">$320</td><td style=\"text-align:left;\">$375</td></tr><tr><td style=\"text-align:left;\">Revenue growth</td><td style=\"text-align:left;\">9%</td><td style=\"text-align:left;\">32%</td><td style=\"text-align:left;\">25%</td><td style=\"text-align:left;\">24%</td><td style=\"text-align:left;\">22%</td><td style=\"text-align:left;\">20%</td><td style=\"text-align:left;\">18%</td></tr><tr><td style=\"text-align:left;\">EPS</td><td style=\"text-align:left;\">$3.30</td><td style=\"text-align:left;\">$6</td><td style=\"text-align:left;\">$9</td><td style=\"text-align:left;\">$13</td><td style=\"text-align:left;\">$18</td><td style=\"text-align:left;\">$24</td><td style=\"text-align:left;\">$30</td></tr><tr><td style=\"text-align:left;\">EPS growth</td><td style=\"text-align:left;\">7%</td><td style=\"text-align:left;\">79%</td><td style=\"text-align:left;\">50%</td><td style=\"text-align:left;\">44%</td><td style=\"text-align:left;\">38%</td><td style=\"text-align:left;\">33%</td><td style=\"text-align:left;\">25%</td></tr><tr><td style=\"text-align:left;\">Forward P/E</td><td style=\"text-align:left;\">50</td><td style=\"text-align:left;\">51</td><td style=\"text-align:left;\">50</td><td style=\"text-align:left;\">49</td><td style=\"text-align:left;\">48</td><td style=\"text-align:left;\">47</td><td style=\"text-align:left;\">45</td></tr><tr><td style=\"text-align:left;\">Stock price</td><td style=\"text-align:left;\">$300</td><td style=\"text-align:left;\">$460</td><td style=\"text-align:left;\">$650</td><td style=\"text-align:left;\">$882</td><td style=\"text-align:left;\">$1,150</td><td style=\"text-align:left;\">$1,410</td><td style=\"text-align:left;\">$1,620</td></tr></tbody></table>Click to enlargeSource: The Financial Prophet.Note: These are my relatively bullish case scenario estimates, but the price targets are still substantially lower than Cathy Wood&#39;s target of $2,000-3,100 for this time frame (2029). Therefore, we could see higher than projected sales and more profitability than my model predicts.I&#39;ve adjusted my long-term estimates slightly higher since my latest projections because of likely increased revenue diversification and more emphasis on higher-margin businesses. Therefore, Tesla&#39;s EPS growth could sustain higher growth levels as its overall operational margins continue rising with improving gross margins in its automotive sales segment.Furthermore, due to Tesla&#39;s exceptional sales and profitability growth potential, it can continue garnering a relatively high P/E multiple of around 40-50 or higher in future years. The dynamic of substantial revenue increases, sales diversification, and improving manufacturing, operational, and administrative efficiency should lead to higher profitability, enabling Tesla to sustain a high multiple and causing its stock price to increase in future years.<h2 id=\"id_1032555601\">Risks to Tesla</h2>Despite my bullish outlook, Tesla faces risks. In the short term, Tesla faces demand, increased production costs, and other transitory issues. Margin compression has also become a problem, and we need to see improvements in future reports. Generally, the EV industry remains sluggish due to lackluster demand, a slow global economy, and high interest rates. There is also considerable competition in the EV space now.Furthermore, there is some uncertainty regarding the Cybertruck ramp-up and its profitability. There are valid valuation concerns, as Tesla appears (near-term) overvalued by some traditional metrics. Investors should consider these and other risks before establishing a position in Tesla.</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: Why I'm Buying The Dip</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; 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}\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: Why I'm Buying The Dip\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-07-26 11:33 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4706599-tesla-why-im-buying-the-dip>seekingalpha</a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\nTesla, Inc. stock was unjustly demolished after its earnings announcement.The mini-crash represents a considerable buying opportunity.Future growth potential in energy generation, new products, and ...\n\n<a href=\"https://seekingalpha.com/article/4706599-tesla-why-im-buying-the-dip\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"LU1720051108.HKD":"ALLIANZ GLOBAL ARTIFICIAL INTELLIGENCE \"AT\" (HKD) ACC","BK4592":"伊斯兰概念","LU0943347566.SGD":"安联收益及增长平衡基金AM H2-SGD","TSLL":"Direxion Daily TSLA Bull 2X Shares","LU2357305700.SGD":"Allianz Global Artificial Intelligence ET H2-SGD","LU1429558221.USD":"Natixis Loomis Sayles US Growth Equity RA USD","LU0234570918.USD":"高盛全球核心股票组合Acc Close","BK4585":"ETF&股票定投概念","LU2756315318.SGD":"ALLIANZ INCOME AND GROWTH \"AMG\" (SGDHDG) INC A","BK4534":"瑞士信贷持仓","LU0053666078.USD":"摩根大通基金-美国股票A（离岸）美元","LU0823411888.USD":"法巴消费创新基金 Cap","LU1435385759.SGD":"Natixis Loomis Sayles US Growth Equity RA SGD-H","BK4555":"新能源车","BK4533":"AQR资本管理(全球第二大对冲基金)","LU0082616367.USD":"摩根大通美国科技A（dist）","LU1551013342.USD":"Allianz Income and Growth Cl AMg2 DIS USD","LU0056508442.USD":"贝莱德世界科技基金A2","LU0719512351.SGD":"JPMorgan Funds - US Technology A (acc) SGD","IE00B1XK9C88.USD":"PINEBRIDGE US LARGE CAP RESEARCH ENHANCED \"A\" (USD) ACC","LU1914381329.SGD":"Allianz Best Styles Global Equity Cl ET Acc H2-SGD","BK4527":"明星科技股","LU2249611893.SGD":"BNP PARIBAS ENERGY TRANSITION \"CRH\" (SGD) ACC","IE00BSNM7G36.USD":"NEUBERGER BERMAN SYSTEMATIC GLOBAL SUSTAINABLE VALUE \"A\" (USD) ACC","LU0234572021.USD":"高盛美国核心股票组合Acc","BK4588":"碎股","LU0820562030.AUD":"ALLIANZ INCOME AND GROWTH \"AMH2\" (AUDHDG) H2 INC","LU2063271972.USD":"富兰克林创新领域基金","SG9999015945.SGD":"LionGlobal Disruptive Innovation Fund A SGD","BK4574":"无人驾驶","SG9999015986.USD":"LIONGLOBAL DISRUPTIVE INNOVATION \"I\" (USD) ACC","LU0823414478.USD":"法巴经典能源转换基金","IE00BWXC8680.SGD":"PINEBRIDGE US LARGE CAP RESEARCH ENHANCED \"A5\" (SGD) ACC","SG9999015978.USD":"利安颠覆性创新基金A","LU0466842654.USD":"HSBC ISLAMIC GLOBAL EQUITY INDEX \"A\" (USD) ACC","LU0689472784.USD":"安联收益及增长基金Cl AM AT Acc","BK4581":"高盛持仓","LU2326559502.SGD":"Natixis Loomis Sayles US Growth Equity P/A SGD-H","LU2087621335.USD":"ALLSPRING GLOBAL FACTOR ENHANCED EQUITY \"A\" (USD) ACC","LU0198837287.USD":"UBS (LUX) EQUITY SICAV - USA GROWTH \"P\" (USD) ACC","LU1861215975.USD":"贝莱德新一代科技基金 A2","BK4511":"特斯拉概念","LU1548497426.USD":"安联环球人工智能AT Acc","LU0820561818.USD":"安联收益及增长平衡基金Cl AM DIS","BK4548":"巴美列捷福持仓","LU1861220033.SGD":"Blackrock Next Generation Technology A2 SGD-H","LU1551013425.SGD":"Allianz Income and Growth Cl AMg2 DIS H2-SGD","LU2602419157.SGD":"HSBC ISLAMIC GLOBAL EQUITY INDEX \"AC\" (SGD) ACC","TSLA":"特斯拉","LU0348723411.USD":"ALLIANZ GLOBAL HI-TECH GROWTH \"A\" (USD) INC"},"source_url":"https://seekingalpha.com/article/4706599-tesla-why-im-buying-the-dip","is_english":true,"share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","article_id":"2454802458","content_text":"Tesla, Inc. stock was unjustly demolished after its earnings announcement.The mini-crash represents a considerable buying opportunity.Future growth potential in energy generation, new products, and services, including the robotaxi business.Despite temporary weakness, Tesla remains a strong buy in the long term with future growth potential in various segments.Brandon Woyshnis/iStock Editorial via Getty ImagesI recently wrote about Tesla, Inc. (NASDAQ:TSLA) being a long-term buy despite the significant run-up. To be fair - I indicated that despite being an intermediate and long-term buy, Tesla had become incredibly overbought in the near term and was likely due for a considerable correction.Fast-forward two weeks, and we received a remarkable buying opportunity. Tesla's earnings failed to please near-term-focused investors and the stock tumbled, with the downside now exacerbated by Wall Street's general risk-off theme.Despite this transitory weakness, Tesla remains a strong buy, especially in the intermediate and long term. The market is overreacting to temporary weakness in automotive sales margins.Investors should focus more on the long-term image, such as future improvements in Tesla's automotive sector and the strong pipeline of products and services that will likely contribute considerably to Tesla's sales and profitability growth in future years.Tesla - Remarkable Buying OpportunityTSLAI warned against chasing the stock after the massive run-up and was relatively cautious going into earnings because of the overheated technical conditions and near-term uncertainties. I purchased most of my recent shares in the $140-180 area and added more in yesterday's decline. We've also discussed that Tesla may close the $220-210 gap and possibly overshoot to $200 in a bearish case selloff.Tesla's stock is on track to achieve these objectives, creating an excellent intermediate and long-term buying opportunity. Technically, Tesla's stock is no longer overbought, but could soon become oversold. The RSI is approaching the 30-40 level, and the full stochastic could dip below 20 soon. The 50-day MA is about to cross the 200-day, implying an improvement in Tesla's stock's momentum. While Tesla's stock remains volatile, it could even out and continue its recently started long-term uptrend.Tesla Earnings - Market OverreactionIn my pre-earnings Tesla article, I predicted $25B in revenues, $4.55B in gross profit, an 18.2% gross profit margin, and $0.46 in GAAP EPS. Tesla reported $25.5B in revenues, $4.578B in gross profit, an 18% gross margin, and $0.46 in GAAP EPS. Technically, Tesla's results were not much worse, and in some areas, better than I envisioned. So, then, where did Tesla go wrong?Statement of OperationsStatements of operationsThe first factor is the abnormally sizeable regulatory credit income used last quarter ($890M). This amount seems like a record for the company, implying that Tesla is now going through a \"challenging\" phase.Why is this period challenging, you may ask?Several key factors are at play here, but the good news is that they all appear transitory. First, we have a relatively sluggish global economy with high interest rates. This environment is not great for EVs, as financing costs are relatively high and demand is lackluster.Second, there is a general glut concerning the EV segment. Growth has been so explosive during the past five years that the global market has become oversaturated with EVs. ICE vehicles are making a comeback (temporarily, likely), especially with relatively cheap oil prices now.However, the EV revolution is likely on hold; it's still ongoing, and demand should increase as the economy improves, rates decline, and the market becomes less saturated with EVs.Third, increased competition has sprung up everywhere. On the one hand, there are Chinese EV makers. Then there are the legacy automakers, such as Americans, Germans, Koreans, and others, who are making EVs. Of course, this dynamic is healthy for the overall market, but it's causing Tesla's growth to slow and forcing Tesla to decrease prices on its EVs.Fourth, margin compression is occurring for several reasons. Tesla has decreased prices, but it is also going through costly ramp-up processes with the Cybertruck and the redesigned Model 3. If we exclude regulatory credit revenue, Tesla's automotive sales gross margin was only about 14% last quarter, the lowest in years.Fifth, Tesla had a $622M \"restructuring and other\" charge last quarter (likely due to mass layoffs). Without this one-time charge, Tesla's normalized (non-GAAP) EPS would have been around $0.70 instead of $0.52.Look On The Bright Side And Keep A Long-Term OutlookTesla's operating costs were lower than expected, R&D spending was less than in the previous three quarters, and SG&A expenses were lower than in the last two quarters. Furthermore, Tesla finished the quarter with a massive $30.7B cash position, a sequential increase of $3.9B.Tesla's energy generation and storage business is booming and being overlooked. Sales totaled over $3B last quarter, up about 88% sequentially. The gross margin here is almost 25%. Tesla's energy business will likely continue expanding and become increasingly profitable with scale.The \"services and other segment\" continues improving, with over $2.6B in sales last quarter. Profitability here is also improving, and services/others could continue expanding and become increasingly profitable.The Model 3/Y ASPs are dirt cheap right now. Tesla's automotive sales were only $18.53B last quarter. I deduced that Tesla sold around 414,000 Model 3/Ys the previous quarter and roughly 21,335 \"other vehicles.\"My ASP projections were a bit high-$110K for other vehicles and $41K for the Model 3/Y segment. In reality, Tesla likely had ASPs closer to $100K for its other cars or around $2.14B in sales.This dynamic implies that Tesla's Model 3/Y segment generated about $16.4B in revenues last quarter, equating to approximately $39.6K in ASP. Tesla has already begun raising prices on its Model Y in the U.S., with more price hikes ahead (likely).New products and services are in the pipeline. Tesla's Model 2 is scheduled to arrive next year. If you think Model 3/Y sales are fantastic (1.5-2M annually), wait until the Model 2 arrives. With an ASP of around $40K for the Model 3, the Model 2 would stand out at around $30-32K.This price point would open up a whole new market for Tesla, where it could compete with cheaper Chinese EVs and mass market leaders like the Toyota Corolla, Honda Civic, and many other mainstream cars. Tesla could sell 1-2M Model 2s annually, enabling another $30-60B in revenues for the EV giant.Get ready for the future. Uber and Lyft stocks have been struggling for a reason: Tesla's robotaxi business could take considerable market share in future years. Many analysts believe the robotaxi business will be massive for Tesla, and some people like Cathy Woods cite it as one of the primary catalysts for massive price targets in future years.The fund manager expects Tesla to be around $2,600 in five years. Yes, that's about a 1,000% upside from here, and it could make Tesla the most valuable company globally. If you think this is far-fetched, don't, because robotaxis is already available in China and San Francisco, LA, Las Vegas, and other areas. It's the future of taxi travel, and Tesla is in a prime position because of its car business, AI, and FSD.The Bottom LineAs the global economy improves and interest rates decrease, demand for EVs should rebound, enabling Tesla to raise vehicle prices. Moreover, Tesla remains the technological innovator and leader in the EV segment and is essentially the industry's gold standard, as far as I am concerned. Therefore, Tesla's automotive sales and margins should rebound and improve more than anticipated in future quarters.Moreover, Tesla's Cybertruck ramp-up and its redesign projects should become less cost-intensive, and gross profitability should increase in its automotive segment. Furthermore, Tesla should continue benefiting from its growing and highly profitable energy generation and storage business.Additionally, Tesla's future projects, such as the robotaxi, FSD technology, AI, robotics, and other segments, should diversify its revenue considerably, enabling its overall margins to increase over time. We should also see Tesla's automotive sales margins improving and potentially returning to 17% or higher as the economy normalizes, production costs decrease, and ASPs rise.This is a \"low point\" for Tesla, and there is a high probability that we could see considerable improvements in future quarters, which should raise Tesla's stock price. My 12-to 18-month price target for Tesla remains $500, and the stock can go considerably higher after that.What Tesla's financials may look like in the future:The Year2024202520262027202820292030Revenue Bs$106$140$175$215$265$320$375Revenue growth9%32%25%24%22%20%18%EPS$3.30$6$9$13$18$24$30EPS growth7%79%50%44%38%33%25%Forward P/E50515049484745Stock price$300$460$650$882$1,150$1,410$1,620Click to enlargeSource: The Financial Prophet.Note: These are my relatively bullish case scenario estimates, but the price targets are still substantially lower than Cathy Wood's target of $2,000-3,100 for this time frame (2029). Therefore, we could see higher than projected sales and more profitability than my model predicts.I've adjusted my long-term estimates slightly higher since my latest projections because of likely increased revenue diversification and more emphasis on higher-margin businesses. Therefore, Tesla's EPS growth could sustain higher growth levels as its overall operational margins continue rising with improving gross margins in its automotive sales segment.Furthermore, due to Tesla's exceptional sales and profitability growth potential, it can continue garnering a relatively high P/E multiple of around 40-50 or higher in future years. The dynamic of substantial revenue increases, sales diversification, and improving manufacturing, operational, and administrative efficiency should lead to higher profitability, enabling Tesla to sustain a high multiple and causing its stock price to increase in future years.Risks to TeslaDespite my bullish outlook, Tesla faces risks. In the short term, Tesla faces demand, increased production costs, and other transitory issues. Margin compression has also become a problem, and we need to see improvements in future reports. Generally, the EV industry remains sluggish due to lackluster demand, a slow global economy, and high interest rates. There is also considerable competition in the EV space now.Furthermore, there is some uncertainty regarding the Cybertruck ramp-up and its profitability. There are valid valuation concerns, as Tesla appears (near-term) overvalued by some traditional metrics. Investors should consider these and other risks before establishing a position in Tesla.","news_type":1},"isVote":1,"tweetType":1,"viewCount":131,"commentLimit":10,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"symbols":[],"verified":2,"subType":0,"readableState":1,"langContent":"EN","currentLanguage":"EN","warmUpFlag":false,"orderFlag":false,"shareable":true,"causeOfNotShareable":"","featuresForAnalytics":[],"commentAndTweetFlag":false,"andRepostAutoSelectedFlag":false,"upFlag":false,"length":24,"xxTargetLangEnum":"ORIG"},"commentList":[],"hasMoreComment":false,"orderType":2}