October is shaping as much as be an eventful month for Tesla (NASDAQ: TSLA).
On Oct. 2, Tesla launched its manufacturing and supply stats for the third quarter — commonplace process for the corporate previous to publishing its quarterly earnings. Simply days later, it held its extremely anticipated “We, Robot” occasion, throughout which it confirmed off the progress it has made on self-driving automobiles and humanoid robots.
And on Oct. 23, it’s going to challenge its third-quarter earnings report.
Let’s discover some vital themes that traders needs to be fascinated about as Tesla’s quarterly report approaches, and assess if now is an effective time to purchase the inventory.
What’s at stake in Tesla’s upcoming report?
As a shareholder of Tesla, I’ll be looking out for the next issues in its third-quarter report:
1. Updates on the lower-cost vehicle model;
2. Information surrounding the Robotaxi and autonomous driving typically;
3. Something associated to Optimus and Tesla’s robotics vision.
With all that stated, I do not truly suppose the upcoming report andearnings callwill be something particular. Lots of this information has already been shared.
I might be fairly stunned if Tesla’s administration gives far more element or says something materially totally different on Oct. 23 than what it shared in the course of the Robotaxi occasion on Oct. 10. For that reason, I am not holding my breath for any surprises — constructive or detrimental.
Picture Supply: Getty Photos
How has Tesla inventory carried out following earnings reviews?
The chart beneath illustrates the value motion of Tesla inventory throughout the previous seven earnings durations. The dates of the earnings reviews are denoted by the purple circles marked with the letter “E”.
Information by YCharts.
It is apparent that Tesla inventory tends to expertise heightened volatility across the instances of its earnings releases. On a number of events, shares surged considerably upfront of these reviews, solely to droop shortly after they arrived.
When unsure, zoom out
Take a step again, although, and take into account the returns of Tesla inventory over varied time durations.
| Metric | 1 Yr | 3 Years | 5 Years | 10 Years | All Time |
|---|---|---|---|---|---|
| Tesla inventory value return | (12.8%) | (18.9%) | 1,230% | 1,360% | 13,660% |
Information supply: Ycharts.
Clearly, Tesla shareholders have been dissatisfied by the inventory’s outcomes over the previous few years. Macroeconomic forces akin to lingering inflation and a excessive rate of interest atmosphere took a toll on the corporate’s progress. Nevertheless, the economic system is displaying indicators of resiliency: Inflation has cooled to beneath 3%, the Federal Reserve is tapering rates of interest, and the labor market stays pretty sturdy. I believe these components ought to bode effectively for Tesla within the close to time period.
In the long term, nevertheless, there’s one thing far more vital to notice. Tesla inventory has been a bona fide multibagger over the long run.
So, the query stays: Must you purchase Tesla inventory earlier than its subsequent earnings report? In my view, it would not actually matter. There is a good probability the inventory will see larger volatility because it has in prior earnings durations, however the extra essential level to recollect is that making an attempt to time the market is a often a shedding proposition.
If you’re a believer in Tesla’s AI imaginative and prescient and really feel the corporate is making the precise strikes to stay a frontrunner within the auto trade, the inventory may very well be value including to your portfolio, irrespective of the place within the earnings calendar we’re.
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*Inventory Advisor returns as of October 14, 2024
Adam Spatacco has positions in Tesla. The Motley Idiot has positions in and recommends Tesla. The Motley Idiot has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the creator and don’t essentially replicate these of Nasdaq, Inc.
