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Tesla (TSLA) Gains As Market Dips: What You Should Know

Zacks Equity Research

Tesla (TSLA) closed at $371.34 in the latest trading session, marking a +1.38% move from the prior day. The stock outpaced the S&P 500's daily loss of 1.76%. At the same time, the Dow lost 1.45%, and the tech-heavy Nasdaq lost 1.99%.

Coming into today, shares of the electric car maker had gained 17.79% in the past month. In that same time, the Auto-Tires-Trucks sector gained 10.99%, while the S&P 500 gained 1.56%.

TSLA will be looking to display strength as it nears its next earnings release. In that report, analysts expect TSLA to post earnings of $0.45 per share. This would mark year-over-year growth of 21.62%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $7.64 billion, up 21.24% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $1.76 per share and revenue of $29.34 billion. These totals would mark changes of +5766.67% and +19.39%, respectively, from last year.

Investors might also notice recent changes to analyst estimates for TSLA. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 11.86% higher. TSLA is holding a Zacks Rank of #3 (Hold) right now.

In terms of valuation, TSLA is currently trading at a Forward P/E ratio of 208.11. This valuation marks a premium compared to its industry's average Forward P/E of 28.87.

Also, we should mention that TSLA has a PEG ratio of 5.95. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Automotive - Domestic was holding an average PEG ratio of 4.25 at yesterday's closing price.

The Automotive - Domestic industry is part of the Auto-Tires-Trucks sector. This group has a Zacks Industry Rank of 55, putting it in the top 22% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow TSLA in the coming trading sessions, be sure to utilize Zacks.com.


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