A few days back, one of the leading companies in the automobile industry and the top electric vehicle producer announced its earnings for the first quarter. Of course, we are talking about Tesla. This announcement has brought about a lot of new predictions and analyses of the company’s performance in the future.
Although the profit they recorded in the first quarter surpasses the expectation of Wall Street, the market atmosphere doesn’t presently prove to be on Tesla’s side, according to many analysts. This made them predict the possibility of Tesla stock dropping before rising to another higher level.
What should be the expectation of investors for the rest of this year regarding Tesla stock? In today’s blog, we are set to show you the facts of analysis and predictions roaming around this topic of the Tesla movement in this quarter and the other half of the year. Keep on reading to see the analysis that can help you make your own conclusion.
Looking back at the most recent performance of the company, Tesla was able to generate a profit that is 30 percent greater than their earnings in the fourth quarter of 2021. This excites investors and pushes a hope of confidence in the company. On the other side, their delivery for the first quarter of 2022 was also up to 310,000, which is very impressive even though it’s lower than what experts expected.
With all these numbers, Tesla appears to be doing well. However, will the company be able to meet up with the next income and delivery target? There are many factors that could provide the correct answer to that question.
The covid shutdown in Shanghai is one arrow on the spine of Tesla production currently, and this has been a concern for the delivery capacity of Tesla in this second quarter and the remaining half of the year.
Recently, the stock price of Tesla Company has dropped from 1,152 dollars to 972 dollars. We can see that the average mark of 1000 dollar stock price for the company is unstable. This can be credited to be as a result of the shutdown of Tesla firm in China and change in investor incentives and behaviour. Nevertheless, Tesla is likely to have an amazing increase in performance over this quarter and the rest of the year. According to Elon Musk, he hopes that production records will begin to show up from the Shanghai factory.
There are also reports that the company proposes increased production in existing factories and commencement of automobile manufacturing in new factories. The production facility is expected to resume production by May 16 of this year and they are expected to produce 2600 vehicles per day. If you are enjoying this blog, we highly encourage you to hit the share and signup to our newsletter before we move on. It will give you the opportunity of getting notified whenever we have another load of information for you on your lifestyle and financial success. You can check out also our previous blog such as “Stocks for April 2022“.
Another factor that puts Tesla on the positive side of the prediction is the rise in the price of oil and gas ravaging the world right now. We don’t need to be a rocket scientist to know that many people will now start to consider electric vehicles as the better option to reduce expenses. This means an increasing demand for Tesla cars.
Interestingly, Tesla is trying to meet the high demand level from customers and survive the storm over their competition that are now announcing reduction or temporary stop in production due to the increasing cost of production, especially battery costs. The CEO believes that the company will be able to recover from the limited output in the second quarter and resume total production and delivery in the few months to come.
The intention of Elon musk to purchase Twitter is another good news for Tesla Company and investors because it can give him more potential to create a more powerful base of customers and shareholders. Now that he has been able to take over Twitter, there is more expectation of the improved overall performance of Tesla and competitive advantage. Thus we can predict a higher probability of growth in the next half of the year.
But, with the series of obstacles Tesla needs to deal with as we are talking, it’s natural to know the growth will take time and that there is a higher possibility of regression and stagnation before the company’s result picks up again. If this happens, it will surely tell on their stock. Whatever the situation, there are still more conditions in favour of Tesla automobile company, and experts expect a turnaround after the fall that might hit the stock of Tesla company.
With all of the above into consideration, it’s clearly logical to predict the growth of Tesla in terms of revenue, income and delivery over the remaining part of the year. But when we observe the current situation of the company, which is not so favourable, it might as well be reasonable to forecast a significant drop in performance soon before they pick up again to achieve greater production, delivery and earning as the year goes by.
What is your opinion of Tesla stock presently and the next quarters of the year? Do you think it will drop before it rises? Can you predict the market shift? Let us know in the comment section.
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Recommended books for further reading:
- The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns (Little Books. Big Profits
- The Financial Times Guide to Investing:The Definitive Companion to Investment and the Financial Markets: The Definitive Companion to Investment and the Financial Markets
- Rich Dad’s Guide to Investing: What the Rich Invest in, That the Poor and the Middle Class Do Not!
- How to Make Money in Stocks: A Winning System In Good Times And Bad
- A Beginner’s Guide to the Stock Market: Everything You Need to Start Making Money Today
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