Tesla Inc

Tesla, Inc. (NASDAQ: TSLA) designs, develops, manufactures, sells and leases high-performance fully electric vehicles and energy generation and storage systems, and offers services related to its products. The Company's segments include automotive, and energy generation and storage. The automotive segment includes the design, development, manufacturing, sales and leasing of high-performance fully electric vehicles, and sales of automotive regulatory credits.

Recent Business and Financial Updates

• Financial Performance: In Q3 2024, Tesla achieved robust financial results with USD 2.7 billion in GAAP operating income and USD 2.2 billion in GAAP net income, supported by USD 2.5 billion in non-GAAP net income. The company delivered record third-quarter vehicle volumes, bolstered by sequential and year-on-year growth in deliveries. Tesla also recorded its second-highest regulatory credit revenues, reflecting other OEMs’ lagging compliance with emissions standards. The cost of goods sold (COGS) per vehicle reached a record low of USD 35,100, underscoring Tesla's continued focus on cost efficiency.
• Operational Highlights: Tesla remains committed to accelerating the transition to sustainable energy by prioritizing affordability in electric vehicles (EVs) and making total cost of ownership competitive with all transportation modes. Preparations for the launch of new, more affordable models remain on schedule for the first half of 2025. At the "We, Robot" event in October, Tesla outlined its vision of offering autonomous transport at a cost per mile lower than rideshare, personal car ownership, and public transit. The energy business also delivered strong results, with record gross margins and significant milestones such as the production of 200 Megapacks in a week at the Megafactory in Lathrop and record Powerwall deployments for the second consecutive quarter.
• Cash Flow and Investments: Tesla reported an operating cash flow of USD 6.3 billion and free cash flow of USD 2.7 billion in Q3, resulting in a USD 2.9 billion increase in cash and investments, which now total USD 33.6 billion. The company remains focused on capitalizing on the energy transition by investing in AI projects, production capacity, and a diversified vehicle and energy product lineup.
• Automotive and Energy Progress: Production and delivery volumes returned to year-on-year growth, with Tesla producing its 7-millionth vehicle in October. The refreshed Model 3 ramped successfully, lowering COGS and increasing production. The Cybertruck saw sequential production growth and achieved positive gross margins for the first time. In China, Tesla’s Shanghai factory marked significant milestones, including its 3-millionth vehicle produced and 1-millionth vehicle exported. Europe saw strong sales of the Model Y, which became the best-selling EV of all time in Norway and the top-selling vehicle in Europe for September.
• Technological Advancements: Tesla expanded its AI training compute capacity by over 75% in Q3, launched FSD (Supervised) V12 with enhanced safety and functionality, and introduced innovations like the "Actually Smart Summon" feature. Tesla also unveiled its Cybercab and Robovan vehicles designed specifically for autonomy, featuring a highly efficient powertrain achieving 5.5 miles per kWh. Additionally, Tesla produced its 100-millionth 4680 battery cell and advanced its dry-cathode manufacturing processes.
• Outlook: Tesla anticipates slight growth in vehicle deliveries in 2024 despite macroeconomic challenges, with energy storage deployments expected to more than double year-over-year. The launch of new, affordable vehicles in 2025, leveraging aspects of the next-generation platform, is expected to drive further growth. Tesla remains focused on balancing cost efficiency, maintaining a strong balance sheet, and innovating in AI, software, and fleet-based profits to complement its hardware business.

Technical Observation (on the daily chart):

The Relative Strength Index (RSI) over a 14-day period stands at a value of 61.77, recovering from overbought zone, with expectations an upward momentum from the near important support zone of USD 380-USD 420. Additionally, the stock's current positioning is above both the 50-period SMA and 200-period SMA, which may serve as dynamic short to medium-term support levels.  

As per the above-mentioned price action, recent key business and financial updates, momentum in the stock over the last month, and technical indicators analysis, a ‘Buy’ rating has been given for Tesla, Inc. (NASDAQ: TSLA) at the current market price of USD 424.26 as of December 20, 2024, at 06:45 am PST. 

Individuals can evaluate the stock based on the support and resistance levels provided in the report in case of keen interest taking into consideration the risk-reward scenario. 

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and prevailing geopolitical tensions. Therefore, it is prudent to follow a cautious approach while investing.

Related Risk: This report may be looked at from a high-risk perspective and a recommendation is provided for a short duration. This report is solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rates risks, currency risks, social and political instability risks etc. 

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance level is December 20, 2024. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: Target Price refers to a price level that the stock is expected to reach as per the relative valuation method and or technical analysis taking into consideration both short-term and long-term scenarios.

Note 5: ‘Kalkine reports are prepared based on the stock prices captured either from the New York Stock Exchange (NYSE), NASDAQ Capital Markets (NASDAQ), and or REFINITIV. Typically, all sources (NYSE, NASDAQ, or REFINITIV) may reflect stock prices with a delay which could be a lag of 15-20 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.