Tesla missed Wall Street’s fourth-quarter earnings estimates despite being helped by a gain in the company’s bitcoin holdings. Shares rose anyway in late trading as nothing really changed in the outlook for self-driving cars and new EV models designed to boost growth.
Now Wall Street is weighing in.
“Playing the waiting game,” wrote Baird analyst Ben Kallo in a Wednesday report. He pointed out that Tesla missed results and there was no mention of Musk’s goal of growing delivery volumes by 20% to 30% in 2025. Tesla delivered about 1.8 million cars in 2024, down about 1% compared with 2023.
Still, Tesla is planning to launch a new model and a self-driving robotaxi service this year. Nothing really changed. He is just waiting to see those catalysts become reality. Kallo rates shares Buy, but cut his price target to $440 from $480.
“Lots of irons in the fire,” summarizes his investment thesis. Tesla is building robots, cars, self-driving cars, a network to recharge cars, and battery storage products for utilities–among other things.
“Valuation questions will continue in early 2025,” added Kallo. He sees bulls and bears arguing about what Tesla stock is worth for the foreseeable future.
CFRA analyst Garrett Nelson raised his target price $10 to $540 a share following earnings. “Despite the miss, and backing off its prior 2025 vehicle sales growth guidance…shares jumped after hours as we believe the market is focused more on its expectation that Tesla aims to launch unsupervised full self-driving in parts of the U.S. later in 2025,” wrote the analyst.
Those are two analysts who rate the shares Buy. Wells Fargo analyst Colin Langan rates them Sell and has a $125 price target for the stock. He wrote Tesla “whiffed’ on margins. Tesla’s automotive gross profit margins excluding the benefit of regulatory credits came in below 14%. Wall Street was looking for closer to 16%.
Weaker-than-expected profit margins is an accurate description of fourth-quarter results, but investors don’t seem to be concerned.