Tesla(US:TSLA) SPDB International·2025-05-16 10:35Investment Rating - The report maintains a "Hold" rating for Tesla (TSLA.US) and raises the target price to $374.8, indicating a potential upside of 8% [1][3]. Core Insights - Short-term automotive sales are under pressure, with a significant decline in revenue and profits expected in 2025 due to global economic conditions and production line adjustments for new models. However, long-term growth potential remains strong due to advancements in autonomous driving and robotics technology [1][9]. - The current price-to-earnings (P/E) ratio for Tesla is 145x, reflecting the market's expectations for future growth despite current challenges [1]. Financial Projections - Revenue projections for 2023 to 2027 show a peak in 2026 at $116.9 billion, with a projected revenue decline in 2025 to $96.8 billion, followed by a recovery in subsequent years [2][10]. - Net profit is expected to decrease significantly in 2024 to $7.1 billion, with a further decline to $5.95 billion in 2025, before rebounding to $8.9 billion in 2026 and $12.1 billion in 2027 [2][10]. - The report highlights a projected basic earnings per share (EPS) of $1.85 in 2025, down from $4.72 in 2023, with a gradual increase to $3.75 by 2027 [2][10]. Performance Analysis - In Q1 2025, Tesla's revenue fell by 9% year-over-year to $19.3 billion, with automotive sales revenue declining by 20% [11]. - The gross margin for automotive sales decreased to 15.2% in Q1 2025, down from 17.8% in Q1 2024, indicating pressure on profitability [11]. - The report notes that Tesla's automotive delivery volume decreased by 13% year-over-year in Q1 2025, reflecting challenges in maintaining sales growth [11]. Valuation Methodology - The report employs a sum-of-the-parts valuation method, arriving at a target price of $374.8, which corresponds to a P/E ratio of 136x for 2026 [14].