Tesla Earnings to Show EV Maker Falling Further Behind Big Tech

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With shares falling and profits shrinking, Tesla Inc. is increasingly looking like the odd one out among its mega-cap technology peers. Investors worry that quarterly results will make the electric-vehicle maker even more of an outlier.

Hatem Dhiab, managing partner of Gerber Kawasaki Wealth & Investment Management, joins and talks about Tesla's robotaxi event.

The results, due on Wednesday after the close, may not have mattered so much if Tesla had awed investors with its splashy reveal of a self-driving car earlier this month. But the robotaxi failed to live up to high expectations, putting more pressure on the company’s bread-and-butter business of selling EVs.

A better-than-expected set of numbers would help shore up some confidence in the near term, though analysts warned that a big move higher for the shares may be difficult without more clarity about longer-term growth. The third-quarter estimates represent a significant drop from a year ago, when analysts had forecast EPS of $1.09. Meanwhile, the main metric that traders watch — automotive gross margin excluding regulatory credits — is expected to be 14.9%, up slightly from the second-quarter figure of 14.6%.

Lower profit expectations have also made Tesla’s stock valuation appear even more pricey. At 74 times forward earnings, it’s the most expensive of the mega-cap group, which consists of Amazon.com Inc., Microsoft Corp., Apple Inc., Alphabet Inc., Meta Platforms Inc. and Nvidia Corp.

 

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