The Zacks Analyst Blog Tesla, General Motors, Ford and Stellantis

Core Viewpoint - Tesla is preparing to release its Q4 2024 earnings on January 29, with expectations of earnings per share (EPS) at 76 cents and revenues at $27.6 billion, reflecting year-over-year growth in both metrics [2][3]. Financial Performance - The earnings estimate for Q4 has been revised downward by 1 cent in the last 30 days, but still indicates a 7% year-over-year growth. Revenue is expected to increase by 9.7% year-over-year [3]. - For 2025, Tesla's revenue is projected at $117.2 billion, a 17.5% increase year-over-year, while EPS is expected to contract by approximately 34.3% [4]. - Tesla's automotive revenues for Q4 are projected at $22.5 billion, a 4.5% increase year-over-year, although gross margins are expected to decline from 20.1% to 18.9% [7]. Production and Deliveries - In Q4, Tesla produced 459,445 vehicles and delivered 495,570, marking a 2% year-over-year increase but falling short of the 500,000 unit milestone [6]. - The Zacks Consensus Estimate for deliveries was 517,043 units, indicating a shortfall in expectations [6]. Segment Performance - Tesla's energy generation and storage business is expected to report revenues of $2.6 billion, an 80% increase year-over-year, driven by strong demand for Megapack and Powerwall products [9]. - The Services/Other segment is forecasted to generate $2.9 billion in revenues, up from $2.16 billion in the previous year, supported by the expansion of the supercharging network [9]. Market Position and Valuation - Tesla's stock has doubled over the past year, outperforming the industry and S&P 500, but is considered overvalued with a forward price/sales ratio of 11.25 compared to the industry average of 2.43 [10]. - The company has missed EPS estimates three times in the last four quarters, with an average earnings surprise of 0.13% [4]. Regulatory Environment - The return of President Donald Trump may lead to significant changes in the EV landscape, including potential rollbacks of EV incentives, which Tesla CEO Elon Musk believes will have a lesser impact on Tesla compared to competitors [11][12]. - Trump's plans to raise tariffs on Chinese imports could further strengthen Tesla's competitive position against affordable EV manufacturers [13]. Future Outlook - 2025 is seen as a critical year for Tesla to demonstrate its ability to drive sales growth and profitability, particularly in the autonomous vehicle and robotaxi sectors [15]. - Investors are advised to monitor Tesla's profit margins and cash flow closely during the upcoming earnings call for insights into the company's financial health [14].