'Let's Get Real:' Tesla Analyst Shrugs Off 4% Stock Drop, But Hints At Slowest Delivery Growth In A Decade
Portfolio Pulse from Shanthi Rexaline
Tesla, Inc. (TSLA) shares dropped over 4% on Wednesday, but bullish analyst Gary Black of Future Fund remains optimistic. Despite the downturn, Black highlighted Tesla's strong performance in 2023 with a 102% increase compared to Nasdaq's 54%. He attributed the tech sector's decline to investor concerns over the Federal Reserve's less aggressive rate cuts. Black praised Tesla's Q4 deliveries, driven by record demand in China, and anticipates Q4 core auto gross margins to exceed Q3's 16.3%. He expects Tesla to guide to 2024 deliveries of at least 2.2 million units, a 22% year-over-year growth, which would be the slowest since 2013 but still achievable. The Future Fund Active ETF (FFND), where Tesla is the second-biggest holding, may also be impacted by these sentiments.
January 04, 2024 | 8:18 am
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NEUTRAL IMPACT
The Future Fund Active ETF (FFND), with Tesla as its second-largest holding, may be influenced by the same factors affecting Tesla's stock, including the recent drop and growth projections.
FFND's performance is partially tied to Tesla's fortunes due to its significant holding in the company. While the ETF may be impacted by Tesla's stock movements, the diversified nature of ETFs could mitigate the effect.
CONFIDENCE 70
IMPORTANCE 60
RELEVANCE 70
NEUTRAL IMPACT
Tesla's stock fell by over 4%, but analyst Gary Black remains positive, citing strong Q4 deliveries and expected growth. The slower projected delivery growth for 2024 is seen as achievable despite being the lowest since 2013.
While the stock experienced a significant drop, the positive outlook from a bullish analyst, strong Q4 deliveries, and a reasonable delivery target for 2024 could stabilize the stock in the short term. However, the slowest growth projection since 2013 and broader economic concerns may temper gains.
CONFIDENCE 75
IMPORTANCE 80
RELEVANCE 90