Tesla dips after Q1 deliveries report; analyst reactions mixed

By Senad Karaahmetovic

Tesla (NASDAQ:TSLA) said yesterday it delivered 422,875 electric vehicle (EV) units in the first quarter of 2023, missing the FactSet consensus for 432,000 deliveries. The EV company said it produced 440,808 EVs in Q1.

Shares are down 1.5% in premarket trading.

"We continued to transition towards a more even regional mix of vehicle builds, including Model S/X vehicles in transit to EMEA and APAC, Tesla said.

For the same period last year, Tesla delivered 310,000 EV units and a record 405,278 vehicles in the fourth quarter of 2022.

In 2022, vehicle deliveries rose 40% year-over-year to 1.31 million. For this year, analysts expect Tesla to deliver ~1.8M EVs.

Several analysts weighed in on Tesla ahead of the Q1 deliveries report. Most notably, CFRA analysts upgraded Tesla to Strong Buy from Buy with a price target of $275 per share.

Here's how 5 Tesla analysts saw the Q1 delivery and production report from the EV giant.

Goldman Sachs: "We consider the 1Q23 delivery report to be consistent with our view that Tesla is well positioned for long-term growth, and that the price reductions Tesla has implemented are helping to expand its addressable market and improve demand... We maintain our Buy rating on the stock, and we raise our 12-month price target to $225 (from $200)."

Bernstein: "We continue to believe that Tesla will need to further lower prices this year and/or next year to achieve its volume targets, incrementally pressuring margins... Many investors believe that Tesla's recent price cuts reflect a structural cost advantage that will enable it to pressure rivals and capture outsize volume and dominate the EV market. We maintain that price cuts have and will undermine industry profitability (including Tesla's), but that incumbents are deep pocketed and not likely to back down."

Oppenheimer: "While we remain on the sidelines, we view vehicle sell-through as positive in sum, but continue to have reservations about mix and margins meeting expectations in 1H23 despite TSLA's clear cost advantage vs. peers."

Citi: "No major surprises in the overall delivery number... Net-net, with the stock having traded well into the Q1 delivery report, we’d expect a slight/modest pullback on what will likely be regarded as an inline outcome with softer mix and lingering inventory build concerns."

Guggenheim: "Based on our discussions leading up to the P&D report we believe buy-side expectations were in the 425-430K range... We expect a negative reaction to the P+D report following the sizable run into print (+15% last 2 weeks vs. SPY +5%)."

Tesla stock price closed at $207.46 on Friday to hit a new 4-week high. Shares are up 68.4% year-to-date (YTD).

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