This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.
This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.
What happened
While Tesla (NASDAQ: TSLA) CEO Elon Musk has been making headlines for other reasons in recent days, the focus for investors turns back to his electric car company this afternoon. Tesla is set to report first-quarter earnings after the bell today, and investors seem pessimistic about what they’ll hear. Shares of the electric vehicle (EV) leader were trading down 4.2% as of 2:23 p.m. ET today.
So what
There have certainly been some positive highlights for the company so far this year. But Tesla investors seem to be concerned about what the impacts to production will be from COVID-19-related lockdowns in Shanghai. Tesla opened the Shanghai plant — its second production facility — in 2018, and it has been a large contributor to the company’s explosive growth.
Now what
The Shanghai plant has been supplying the large market in China as well as its European customers. The suspension of production there won’t have nearly as much impact on the first quarter as it will on second-quarter production, since it only began near the end of the first quarter on March 28. But investors are likely thinking guidance for second quarter will be hit, and that might be what is concerning them ahead of the report.
Tesla is expected to report a huge increase in earnings compared to the year-ago period, but the $2.2 billion in expected first-quarter profit would be slightly lower than the record $2.3 billion reported in the fourth quarter of 2021.
Tesla also has been battling increases in raw material costs. It raised prices on the vehicles produced in the Shanghai plant during the first quarter. Investors will want to hear more about how inflation may be impacting profit margins, and will be focused on what the overall impacts will be from the Shanghai plant production delays. Leading up to the report, investors seem to be expecting the worst.
This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.
The post Why investors are selling Tesla stock ahead of today’s earnings appeared first on The Motley Fool Australia.
Should you invest $1,000 in Tesla right now?
Before you consider Tesla , you’ll want to hear this.
Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Tesla wasn’t one of them.
The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.
*Returns as of January 13th 2022
More reading
- Can the Tesla share price really quadruple from here?
- Why Tesla stock popped before earnings
- Why Tesla stock popped on Monday
- Better stock-split buy: Tesla vs. GameStop
- Shopify, Alphabet, Amazon, and Tesla stocks are splitting — which ones are the best buys?
Howard Smith has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Tesla. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.
from The Motley Fool Australia https://ift.tt/yuH1OFl
Leave a Reply