Tesla Shares Set To Open At 2-Month Low As 2024 Gloom Lingers: What's Going On?
Portfolio Pulse from Shanthi Rexaline
Tesla, Inc. (NASDAQ:TSLA) faces potential stock price decline as it announces further price cuts for its Model 3 vehicles in China, despite investor hopes for an end to such reductions. Gary Black of Future Fund predicts a decrease in Tesla's 2024 earnings estimates by $1 billion or 25-30 cents per share and has lowered his own estimate by 7%. He does not expect increased sales from the price cuts and anticipates other Chinese automakers to follow suit. Tesla's stock is set to open at a 2-month low, with a 3% drop in early trading to $220.40, after closing at $227.22 on Thursday.
January 12, 2024 | 11:01 am
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Tesla's recent price cuts in China and lowered earnings estimates for 2024 suggest a potential short-term decline in its stock price. Analyst Gary Black does not foresee an increase in sales from the price cuts and expects other Chinese automakers to reduce prices as well.
The price cuts in China are likely to compress margins, and the lack of expected sales increase from these cuts could disappoint investors. The lowered earnings forecast by a prominent analyst adds to the negative sentiment, suggesting a bearish outlook for the stock in the short term.
CONFIDENCE 85
IMPORTANCE 90
RELEVANCE 100