Tesla Inc TSLA is set to report profit after the nearby on Wednesday in the thing one expert is calling one of the main profit calls since the Elon Musk-drove organization opened up to the world in 2010. While each quarter is significant for Tesla, we’ll feature that this impending call and direction editorial is quite possibly of the main crossroads in Tesla’s set of experiences and for Musk, Wedbush examiner Dan Ives said in a Tuesday note.
Tesla has experienced a hyper-growth phase over the past few years, dominating EV market share, but now the company is up against a tough macro environment, intensified by “fierce competition coming from all angles”.
On top of that, Musk decided to buy Twitter last year, and many Tesla investors who previously viewed the Tesla CEO as a red cape superhero now think of him as a villain, he said.
In the wake of Musk’s Twitter acquisition, many are concerned that the Tesla CEO isn’t paying the EV company as much attention as he should. Musk has also seemed to polarize with his tweets since acquiring the social media platform.
Tesla is Musk and Musk is Tesla. With all the concern about Musk’s attention on Twitter and the other noise created by this ongoing soap opera, Musk Ives said this is an important moment of truth.
The analyst said he would look to Musk to “comfort investors” by reiterating goals for the year and setting out the company’s strategic vision. The analyst said Twitter’s position would be in a “bright spotlight” for the Street.
Webbush will also be paying close attention to what Musk has to say about the recent price cuts. While the firm believes the cuts were necessary, it is seeking additional information on how they will impact margins. The firm expects this to be a “significant dynamic” on the call.
Lastly, Wedbush highlights the volume. The Street judges Tesla based on its long-term outlook of 50% annual growth. This target is a double-edged sword in our opinion as 2022 was a painful exercise that required the Street to cut its 50% target every quarter to reflect the soft trajectory and weigh heavily on the stock,” Ives said.
Now Musk needs to take the Band-Aid off and come up with a more realistic target for 2023, the analyst said, lest the Street fall behind the target. He added that we see 35%-40% delivery growth for 2023 as the normal bogie for the year based on the 1.8 million unit Whisper in the Sand number. The analyst firm has a 12-month price target on Tesla shares at $175.