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Oct 21, 2021

Tesla Q3 Earnings Report: Revenue and EPS Beat, Stock Unfazed After Hours

By:Thomas Westwater

TESLA, Q3 EARNINGS, SUPPLY CHAIN TALKING POINTS:

  • Tesla Q3 earnings beat estimates, stock unchanged after hours
  • Supply chain issues a key focus for this evening’s earnings call
  • CEO Elon Musk may or may not appear on today’s call

Tesla reported a third-quarter earnings report that exceeded analysts’ expectations Wednesday, with earnings per share (EPS) dropping at $1.86 versus an expected $1.59 on an adjusted basis. Revenue also beat at $13.76 billion versus $13.63 billion expected. The strong numbers come amid a constrained supply chain, which includes a chip shortage that is impacting other automakers.

However, Tesla is more vertically integrated than other large automakers. That gives the company better control of its supply chain, which likely allowed Tesla to limit the downside impacts that are plaguing the industry. Earlier, Tesla reported 241,300 electric vehicle deliveries, with a total production volume of 237,823 for the third quarter.

Despite the upbeat earnings report, the stock price was slightly lower in after-hours trading. Investors will be keenly focused on this evening’s earnings call. Elon Musk earlier this year said he would no longer lead the calls, which has investors speculating over his attendance. If Mr. Musk does jump on the call, it could spur some excitement and speak to his direct hands-on involvement.

Investors will be focused on how Tesla is handling supply chain disruptions, regulatory scrutiny, and its future product lineup. The highly-anticipated Cybertruck’s rollout was postponed earlier this year, with a new production start date in the latter half of next year. Its semitrailer rig is also delayed, speaking to the logistical hurdles facing auto companies during the pandemic.


Tesla Technical Outlook

Prices have rallied hard since the May swing low, with the stock now approaching its 2021 high at 900.40. However, the Relative Strength Index (RSI) is currently flashing a warning signal, with the oscillator cooling within overbought territory. Traders may be keen to take profit given the gains seen over the last few months. A drop back to the 9-day Exponential Moving Average (EMA) may occur. A deeper pullback could see a test of the 78.6% Fibonacci re-tracement level at 823.17.


TESLA DAILY CHART


Chart created with TradingView


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