Tesla(US:TSLA) Huajing Securities·2024-04-30 03:03Investment Rating - The report maintains a "Hold" rating for Tesla (TSLA US) with a target price of US$151.31, down from the previous target of US$159.84, reflecting a 5% decrease in the target price [1][11]. Core Insights - Tesla's 1Q24 performance showed a significant decline in net profit, with GAAP net profit down 55.1% year-over-year and Non-GAAP net profit down 47.6% year-over-year, attributed to a drop in delivery volumes and rising capital expenditures [2][3]. - The annual delivery forecast has been revised down to 1.773 million vehicles, indicating challenges in meeting previous expectations due to declining demand for electric vehicles [2][3]. - New product launches, including a low-cost model and Robotaxi, are expected to support future sales growth, although their timely rollout remains uncertain [3][11]. Financial Summary - For 1Q24, Tesla reported revenues of US$21.3 billion, a year-over-year decline of 8.7%, with automotive revenue at US$17.38 billion, down 12.9% year-over-year [2][5]. - The gross margin for the quarter was 17.4%, down 1.9 percentage points year-over-year, impacted by price promotions and production ramp-up of the Cybertruck [2][5]. - Free cash flow was negative at US$2.53 billion, primarily due to a 90% drop in operating cash flow and a 34% increase in capital expenditures [2][5]. Revenue and Earnings Forecast - Revenue projections for 2024 have been adjusted to US$96.039 billion, reflecting a 3.6% decrease from previous estimates, with expected revenues of US$115.973 billion in 2025 and US$138.961 billion in 2026 [10][16]. - The forecast for Non-GAAP net profit has been reduced to US$11.057 billion for 2024, with expected growth to US$14.705 billion in 2025 and US$18.527 billion in 2026 [10][16]. Valuation Methodology - The report employs a sum-of-the-parts (SOTP) valuation method, maintaining a 50x P/E ratio for the automotive business, resulting in a target price of US$151.31 per share [11][12].