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The latest trading session ended with Tesla (TSLA) price at $170.66, representing a change of -1.8% from the previous trading day’s close. The stock lagged the S&P 500, which recorded a gain of 0.27% for the day. The Dow, on the other hand, recorded a loss of 0.31%, and the tech-focused Nasdaq gained 0.88%.

Heading into today, shares of the electric car maker had gained 1.11% over the past month. Over the same period, the Auto-Tires-Trucks sector lost 0.81%, while the S&P 500 gained 2.85%.

Analysts and investors will be keeping a close eye on Tesla’s performance on its upcoming earnings release. In that report, analysts expect Tesla to report earnings of $0.60 per share, which would represent a year-over-year decline of 34.07%. Meanwhile, our latest consensus estimate is for revenue of $24.91 billion, down 0.08% from the year-ago quarter.

For the full year, the Zacks Consensus Estimates are projecting earnings of $2.47 per share and revenue of $98.56 billion, which represent changes of -20.83% and +1.85%, respectively, from the prior year.

It is also important for investors to stay informed about any changes in analyst estimates for Tesla. Recent revisions typically reflect recent near-term business trends. As a result, optimistic estimate changes suggest that analysts are becoming positive about the company’s business health and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To capitalize on this, we have developed the Zacks Rank, a proprietary model that incorporates these estimate changes and provides a functional rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive track record of exceeding expectations, as validated by outside audits. #1-ranked stocks have delivered an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 1.06% lower. Tesla currently holds a Zacks Rank of #3 (Hold).

Valuation is also important. Investors should therefore be aware that Tesla currently has a P/E ratio of 70.48. The industry average is 12.85, so one could conclude that Tesla is trading at a comparatively higher price.

We can also see that TSLA currently has a PEG ratio of 3.26. The PEG ratio is similar to the widely used P/E ratio, but this metric also takes into account the company’s expected earnings growth rate. The Automotive (Domestic) industry currently had an average PEG ratio of 1.36 as of yesterday’s close.

The Automotive – Domestic industry is part of the Auto-Tires-Trucks sector. The current Zacks Industry Rank of 58 puts this industry in the top 24% of all industries, which includes over 250 industries.

The Zacks Industry Rank evaluates the strength of our individual industry groups by looking at the average Zacks Rank of the individual stocks that make up the groups. Our research shows that the top 50% of industries outperform the bottom half by a factor of 2 to 1.

Don’t forget to use Zacks.com to keep an eye on all of these and other stock-moving metrics in the coming trading sessions.

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Tesla, Inc. (TSLA): Free Stock Analysis Report

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Zacks Investment Research

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