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Vladimir Zernov
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Tesla

Tesla Video 27.04.21.

Tesla Stock Moves Lower As Traders Focus On Supply Chain Problems

Shares of Tesla found themselves under pressure after the company released its first-quarter results. Tesla reported revenue of $10.4 billion and adjusted earnings of $0.93 per share, beating analyst estimates on both earnings and revenue. GAAP earnings of $0.39 per share missed analyst estimates, but the market is traditionally focused on Tesla’s non-GAAP earnings.

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The company reiterated its plan to achieve 50% average annual growth in vehicle deliveries in the long-term. In 2021, Tesla will have to deal with significant supply chain problems due to disruptions brought by the coronavirus pandemic and increased demand for certain parts, including chips.

Traders also keep an eye on revenue from regulatory credits which may decline as other automakers start producing electric vehicles in large quantities. At this point, the market does not look too worried about this issue, but traders may become more focused on regulatory credits and competition in general closer to the end of this year.

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What’s Next For Tesla?

Analysts expect that Tesla will report earnings of $4.33 per share in 2021 and $5.93 per share in 2022, so the stock is trading at a roughly 120 forward P/E. Tesla is viewed as a disruptor to the mobility segment so traditional metrics do not provide a full picture of the company’s valuation, but the company will still have to show significant growth to justify current stock price levels.

Tesla stock had a very successful 2020 and was included into S&P 500, but now the company may need additional positive catalysts to gain sustainable upside momentum from current levels. Tesla’s report easily beat analyst expectations, and the company continues to grow at a fast pace, but the market may want even more at current stock price levels.

Tesla shares are trading more than 20% below yearly highs so many traders will view current prices as an opportunity to add to their positions or establish new ones, but it remains to be seen whether the stock will be able to get back to the upside mode in the near term amid supply chain problems.

For a look at all of today’s economic events, check out our economic calendar.

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