Is Tesla Stock Now a Sale? Here’s What Tesla Earnings Charts Show

Tesla (TSLAChief Executive Elon Musk has defied great odds and consistently exceeded expectations since he took the helm of the electric vehicle manufacturer in 2008. Having submitted a better-than-expected second-quarter earnings report, coupled with a warning that the chip shortage hitting the auto industry remains serious, is Tesla stock a buy?




X



In a conference call with analysts after the earnings report, Musk said it was a record quarter in many areas.

We achieved record production, deliveries and surpassed $1 billion in GAAP net revenue for the first time in Tesla history,” he said. But he added: “As we make cars at full speed, the global chip shortage continues to grow. pretty real. The chip supply is fundamentally the determining factor for our output.”

Despite the chip shortage, Tesla’s revenue nearly doubled to $11.96 billion, above estimates of $11.53 billion. Adjusted earnings were up 230% to $1.45 a share, handily higher than analyst estimates polled by FactSet at 94 cents.

Deliveries increase during the quarter

Tesla previously reported that it delivered 201,250 vehicles in the second quarter, up from the previous record of 184,800 in the first quarter. Deliveries increased by 120% compared to the same period last year.

Meanwhile, China-based rivals Nioz (NIO), xpeng (XPEV) and Li Auto (AT THE) recently reported strong deliveries in the second quarter.

Tesla plans to build its first Model Y vehicles in Berlin and Austin in 2021. But the company said its semi-electric big-rig truck won’t arrive until next year. Musk recently confirmed that the highly anticipated Roadster will be delayed again until at least 2023. Reports also said the Tesla Cybertruck won’t hit the market until late 2022, with volume production not expected until late 2023. The delay suggests that the 4,680 battery cells that make up the Cybertruck powered are still a long way from mass production.

Will boost massive TSLA inventory expansion

Tesla has massively expanded its manufacturing capabilities. Musk wants to build 20 million electric vehicles a year over the next ten years. That is more than double the current production of other car manufacturers. So it is now on a mission to rapidly expand its manufacturing capabilities.

Meanwhile, Tesla Autopilot probes expanded. The National Highway Traffic Safety Administration has sent a letter to Tesla demanding a wealth of data as part of its investigation into 12 Tesla Autopilot crashes in emergency vehicles parked at the side of the road. Security authorities will also investigate a Tesla crash in New York that killed a person changing a tire

When Tesla starts pumping out cars in Germany, it will be up against electric vehicles with three established German names: Volkswagen Group (VWAGY), BMW (BMWYY) and the Mercedes-Benz division of Daimler AG (I will). Other serious competitors include: General engines (GM) and Ford Motor (f), alongside its Chinese rivals.

Tesla still has a solid lead in global EV market share, according to a Morgan Stanley report. The July 27 note shows that Tesla has sold 382,831 vehicles to date and has a 21% market share. No. 2 General Motors has a 12% market share and sales have reached 221,486 so far this year. Volkswagen is in third place with a 10% market share in electric vehicles and 183,197 vehicles sold.

Tesla Share Control

According to the IBD Stock control tool, Tesla stock has a IBD Composite Assessment out of 96 out of 99. The rating means Tesla stock is currently outperforming 96% of all stocks. That’s in terms of the key fundamental and technical criteria for stock selection.

The stock also has a Relative Strength Rating of 86. The rating follows market leadership. It shows how a stock’s price movement over the past 52 weeks compares to that of other stocks.

The cumulation/distribution rating is B+. That rating analyzes price and volume changes in a stock over the past 13 trading weeks. A grade of A signals heavy institutional purchases. The lowest rating of E means heavy sales. Consider the C class neutral.

Among other Tesla data points, the relative strength line is up and holding. The RS line measures the strength of a stock relative to all stocks in the S&P 500. The RS line is the blue line in the displayed chart. Typically, the RS line of the strongest stocks confirms or leads a stock’s price to new highs.

In the stock market, timing is crucial. So when looking for stocks to buy or sell, it’s important to do the fundamental and technical analysis that identifies lower risk entry points that also offer solid potential rewards.

Is Tesla Stock a sale?

Negative Tesla headlines are piling up over expanding crash probes and product delays, but Tesla stock has held its buying point. The point of sale varies from 730 to 766.50.

A deep, large base also continues to form. The EV giant is also finding support above its key 50- and 200-day moving averages, according to Scoreboard..

Tesla recently found support near the 40-week line on the weekly chart. Now it remains above the 10-week moving average for some time. These are encouraging signs. The deep correction within the last base, 40%, actually looks normal in light of a big increase in 2020.

If you’re interested in buying large-cap stocks, these articles provide a technical analysis of leading large-cap stocks to see if they’re in or near a good buy zone.

You will also find warning signals and sell signals alerts that tell you when to take your profits or trim any losses. You will also find out if the current trend in the stock market is conducive to buying stocks, or if it is an environment where you want to take defensive action and sell.

Before making any investment decisions, check: current market conditions and use IBD stock control to see if your stock gets enough ratings for key fundamental and technical criteria.

Follow Brian Deagon on Twitter at: @IBD_BDeagon for more information on technology stocks, analysis and financial markets.

YOU MAY ALSO LIKE THIS:

Tesla is about to unveil its fastest car yet as high-end rivals grow

How do you know it’s time to sell your favorite stocks?

Best Growth Stocks to Buy and Watch: See IBD Stock List Updates

Take advantage of short term in a swing trading environment

Find today’s best growth stocks to watch with IBD 50