Tesla's Rise & Fall Hinges on Q4 earnings ?
What Is Known.
Before $Tesla Motors(TSLA)$ announced its Q4 2024 quarterly earnings on Wed, 29 Jan 2025 (evening), below is a recap of what is known so far.
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In Q4 2024, Tesla achieved record performance with approximately
459,000 EVs produced and over 495,000 delivered.
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However, the 495k was slightly below the 504,770 deliveries analysts had expected.
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Total annual deliveries for 2024 came to 1,789,226, down from 2023’s 1.81 million EVs.
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It is a shortfall of -20,774 EVs.
Q4 Earnings Forecasts.
Below are forecasts from Thomas Reuters.
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Earnings Per Share (EPS) : $0.74 vs $0.65 (2023).
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Revenue : $27.169 billion vs $25.17 billion (2023).
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Net income (adjusted basis) : $2.697 billion vs $7.93 billion (2023). ** note : 2023’s profit was boosted by more than $5 billion in adjustments due to the "release of valuation allowance on deferred tax assets”.
Price Targets.
Based on a poll of 34 Wall Street analysts’ assessment, over a 3-month period:
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Average price target is $336.96 vs $406.58 (Fri, 24 Jan 2025 closing price).
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It works out to be -17.12% below its Friday closing price,
suggesting some analysts think the post-election rally has driven the stock too high.
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High forecast of $550 and low forecast of $24.86.
Specifically, analysts from Wedbush Securities, $Morgan Stanley(MS)$, and Piper Sandler all recently lifted their price targets for Tesla stock to $550, $430, and $500, respectively.
Technical View.
Long-term Trend.
Based on Tesla’s moving averages (ma), its share price remains on a long-term uptrend, as it is trading above its 50-day ma (green) and 200-day ma.
This suggests that investors focused on long-term trends might continue to buy Tesla stock.
Short-term Trading.
In the near term, the price should trade within a range between (a) support levels of $373.80 and (b) resistance level of $432.50.
(1) Range Trading:
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Traders who focus on above ranges might look to buy the stock when it bounces off the lower end of this range (around $373.80) .
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Similarly, he should aim to sell it when it reaches the higher end (around $432.50).
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Should stock price falls below the lower end ($373.80), of the range, it might be a signal to stop trading in this direction.
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If stock price closes below range support ($373.80), it could be regarded as a stop loss consideration
(2) Breakout Trading:
Other traders If the price falls below the middle point of the current trading range, it might be a signal to stop trading in this direction.
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Breakout traders might wait for stock price to break above the resistant level ($432.50) before buying.
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If this happens, they might set the next resistant levels around $467.40 and $487.50.
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With a close below the resistant range’s mid-point as a stop loss consideration.
Worse case scenario.
Should price falls below the support level, long-term investors should wait for a stronger signal before buying, while still keeping an eye on the overall upward trend of the stock.
After earnings call ?
Two key scenarios could unfold after Tesla’s Q4 2024 earnings.
A beat on estimates or strong 2025 guidance could propel the stock above $400, stabilizing its upward momentum.
Conversely, a miss on earnings, revenue, or muted guidance could trigger increased volatility and pressure on the share price.
My viewpoint : (mine only)
Tesla as a company is not in a strong place.
This is because the CEO is extremely distracted, and his heart is not at the right place. In fact it is crumbling, if the suspicion is accurate.
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Mr Musk’s co-partner (Vivek Ramaswamy) at Trump’s newly minted “department of government efficiency” (Doge) has officially, stepped down from his role, hours after the returning president was sworn-in on 20 Jan 2025.
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The alibi was Mr Vivek is planning to run for Ohio governor.
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With Mr CEO flying solo at Doge, it means more time away from Tesla.
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How could that be a good thing for the EV maker ?
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The issue with Mr Musk is that he loves to talk “big” but always come up dismally short in delivery.
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He has previously bragged that its easy peasy to cut $2 trillion from Federal budget.
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He is now backtracking on his previous claim, saying on Wed, 8 Jan 2025 that half that amount ($1 trillion) would be an “epic” outcome. (see above)
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Leaving aside distractions, Tesla is “failing” also because its lead as the world’s most favourite EV has been eroded, overtime by the emergence of $BYD Co., Ltd.(BYDDF)$, the Chinese EV maker. (see above)
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BYD’s ability to produce quality EV at the fraction of Tesla’s EV cost is creating a dent in the latter’s balance sheet.
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More importantly, its the steely determination and drive of its CEO that allows the company to penetrate into the global market, despite tariffs being raised in EU and US alike.
As of Fri, 24 Jan 2025
Tesla’s current stock price is a hype and nothing more.
On 5 Nov 2025, its closing price was $251.44. In fact it has been hovering around the $200 price range for the longest time.
The tide turned when Mr Trump won the presidential election.
Tesla benefitted from CEO Elon Musk's proximity to the Trump administration, as the connection may clear the regulatory path for some of Tesla's future projects.
Mr Trump could not possibly refused to pull Mr Musk along because the latter has donated easily $277 million on the returning presidential campaign. It is money-politics at play.
Character assassination aside, Tesla’s other 2 revenue streams (Energy generation & Services) should once again be the mitigating factors that prop up the company’s top and bottom line.
The “energy generation & storage” has been growing steadily over the past years. (see above)
This should be the “secret” weapon within Tesla.
With a market that is still sore from the Deepseek-earthquake that shook US market to its core, it will not need a lot of bad news to bring Tesla back down from cloud 9.
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Do you think Tesla will be able to pull off another quarterly earnings ?
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Do you think it will be able to sustain its stock price at the $400 range or will it sink to the $300 ?
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