Tesla (TSLA) stock is on a tear after they reported record deliveries and ahead of the Q3 earnings report, but what do you think is going to happen next week?
Earlier this month, Tesla reported a new all-time record delivery of 97,000 cars during the third quarter.
However, we reported a week before the end of the quarter that CEO Elon Musk told employees in an email that Tesla “has a shot” at delivering 100,000 vehicles during the third quarter.
Therefore, there was some disappointment in the market despite the fact that deliveries were higher than most analyst expectations.
Tesla’s stock (TSLA) took a hit after the numbers were released, but it has since recovered and went on 9 straight days of climbing:
The increase comes just a few days before Tesla plans to release its Q3 earnings result on October 23.
Do you think Tesla is going to report a profit for the third quarter?
I think the market quickly got over the fact that Tesla didn’t deliver 100,000 cars like Elon thought possible because there is actually plenty of good news in the delivery numbers.
Of course, 97,000 cars delivered in a quarter is still a new record, but the “record production of 96,155 vehicles” is also really important.
With Gigafactory 3, Tesla is likely going to reach an annualized production rate of 400,000 cars per year by the end of 2019.
Also, unlike previous reports, Tesla didn’t disclose the number of cars in transit at the end of the quarter.
I believe it was quite high and I think it will set Tesla up for a record quarter of deliveries in Q4.
While we know that Tesla delivered a record number of vehicles, the big question is if they did it profitably.
I doubt that’s the case, but I’d love to be surprised.
This quarter, there are even some analysts who think that Tesla’s revenue is going to be down, due to lower price-per-car.
Unless margins are way up, and we have no evidence of that, it would have been hard for Tesla to have turned a profit.
Therefore, I am not expecting great financials for Q3, but I still think there could be a few pieces of good news. We will get into those in our Q3 earnings preview next week.
If you have some ideas, don’t hesitate to let me know in the comment section below.
Disclosure: I am currently long TSLA.
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