Asia FX dithers as dollar steadies before Powell speech; yen muted after CPI data
On Wednesday, Evercore ISI kept a steady outlook on Tesla stock (NASDAQ:TSLA), maintaining an In Line rating and a price target of $235.00. The firm’s analysis followed Tesla’s Q1 results, which revealed earnings per share (EPS) of 27 cents, underperforming compared to the anticipated 38-40 cents. According to InvestingPro data, 12 analysts have recently revised their earnings expectations downward for the upcoming period. Despite this shortfall and a confusing product timeline, Tesla’s shares, currently valued at a P/E ratio of 116.65, did not experience a significant downturn in after-market trading.
The Q1 financial metrics slightly missed expectations in revenue and gross profit, attributed largely to increased operating expenses due to artificial intelligence and research and development projects. These expenses accounted for approximately 75% of the earnings miss. InvestingPro analysis shows Tesla’s gross profit margin stands at 17.86%, with the company generating $97.69 billion in revenue over the last twelve months. Tesla managed to achieve a ’clean’ margin of 12.5% excluding credits, which was considered adequate for a quarter affected by volume issues and production downtime.
Tesla’s Model Y variant is reported to be on schedule for the first half of 2025, despite rumors of delays. Evercore previously forecasted a start of production in the second half of 2025, with the potential for Tesla to produce 150,000 to 200,000 units in 2026 as production ramps up. The possibility of a two-stage launch, including a cheaper Model Y in North America and a dedicated variant for China in 2026, was also suggested.
Tesla CEO Elon Musk’s comments during the earnings call were noted for their focus on artificial intelligence and the anticipated financial contribution of the robotaxi service, which is expected to scale in the second half of 2026. This outlook, along with reaffirmed plans for the Austin Robotaxi and the Optimus project, appeared to contribute to the after-market stock increase of 4-6%.
Looking ahead, Evercore ISI anticipates a downward revision of Tesla’s EPS for 2025 to $2 or below, from a prior estimate of $2.50, based on volume projections and increasing operating expenses. InvestingPro data shows analysts currently forecast FY2025 EPS at $2.93, though this may change given recent developments. The firm expects Street consensus for 2026 EPS to adjust downward towards $3 initially, with further risk of a decrease to $2.50-3 if volumes align closer to 1.9 million units. The Q2 delivery target of 425,000 units will be a critical indicator for assessing ’normalized demand,’ with current estimates around 412,000. For deeper insights into Tesla’s valuation and growth prospects, investors can access the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.
In other recent news, Tesla’s first-quarter earnings report has drawn mixed reactions from analysts. The company reported non-GAAP earnings per share of $0.27, falling short of the consensus estimate of $0.41, as noted by Goldman Sachs. Despite this, Tesla’s automotive non-GAAP gross margin excluding regulatory credits exceeded expectations. Piper Sandler maintained an Overweight rating with a $400 price target, expressing confidence in Tesla’s upcoming initiatives, including the launch of robotaxis and new vehicle models. Conversely, Truist Securities kept a Hold rating and a $280 price target, citing weaker-than-expected results and higher operational expenses. RBC Capital Markets adjusted its price target to $307 while maintaining an Outperform rating, acknowledging the impact of tariffs on Tesla’s growth outlook. Analysts have noted the significance of Tesla’s upcoming milestones, such as the launch of robotaxis in Austin and the introduction of more affordable vehicle models. These developments are anticipated to play a crucial role in shaping Tesla’s financial trajectory for the remainder of 2025.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.