- Report for the IV quarter of 2020 will be published on January 27;
- Forecast revenue: $ 10.37 billion;
- Expected profit per share: $ 1.01.
Tesla (NASDAQ: TSLA) with more than rewarded its loyal investors, who did not scare the stormy past the manufacturer of electric vehicles. Those market participants who held the position throughout 2020, increased their investments about eight times.
However, an incredible rally forced analysts to doubt the validity of the current market assessment of the company, which clearly does not correspond to the dynamics of its profits. In the upcoming Wednesday, Tesla will have to publish a fresh report on financial results, and the Director General of the Ilona Mask will certainly be asked about whether the company will be able to reinforce the rally of shares with similar increasing indicators.
However, these concerns do not interfere with TESLA shares to continue to strengthen in 2021. They have already grew by 21% since the beginning of the year, while S & P 500 during this period added only 1.6%. A similar break clearly indicates high expectations regarding the upcoming publication.
There is no doubt that the prospects of Tesla over the past year have improved significantly. The Californian automaker is no longer faced with production problems that restrained it for most of 2019. This month, management reported investors that almost 500,000 cars in 2020 had almost achieved. In the last quarter, the company has shipped 180,570 cars, which has become a record maximum. In addition, the company did not reach the half-million mark of only 450 cars. In fact, for the year Tesla increased production by 36%.
Operational successes and rally shares allowed the company to restore a shameless financial situation. In 2020, Tesla attracted about 12 billion through the sale of shares, taking advantage of a high market assessment (thereby not too divorced the share of existing investors). And Joe Bayden's accession to the position of President of the United States makes macro-closure more favorable electric vehicle market.
Tesla - giant bubble?
Nevertheless, these successes do not justify the TESLA capitalization ratio to the expected revenue for 2020 in 27. For comparison: for one of the largest competitors of Tesla in the Volkswagen (DE: VOWG), this coefficient is 0.3. Perhaps this discrepancy is the reason why many analysts fear that TESLA rally is due to an exceptionally infusion of incentives and turned the company to a huge bubble that can burst at any time.
Even after a number of authoritative analysts recently abandoned their "bearish" forecasts regarding TESLA, the average target level of shares among experts is still almost 50% lower than the current level. According to Bloomberg, only a third of the surveyed analysts recommend "buying" TSLA, and over the years this percentage has not changed much. For these reasons, a mask must maintain the profitability of Tesla, proving the company's ability to work "in Plus".
The agreed forecast for the past quarter suggests the growth of the company's revenue by 29%, which will allow for the first time to step up the threshold of 10 billion dollars. But the profit per annual profit could decrease from 2.14 to 1.01 dollars (although it will still be the sixth profitable quarter in a row).
To maintain a positive pulse, the mask will also need to demonstrate the success in implementing the planned plans. Tesla builds two new car assembly complex (one - in the suburbs of Berlin, which will produce up to 500,000 cars per year, and the other - in Texas, where the first pickup will be produced). They must be launched at the end of this year, after replenishing the list of factories in Frimont and Shanghai.
Summarize
Even after the unprecedented Tesla rally in 2020, investors demonstrate faith in the company's ability to exceed expectations. Another strong report will certainly justify the "bullish" forecasts, but they are already taken into account in the value of shares. On the other hand, any negative surprise can prove the explicit revaluation of TESLA.
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