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

Zacks Equity Research
·3 min read

Tesla (TSLA) closed the most recent trading day at $622.58, moving -1.68% from the previous trading session. This move lagged the S&P 500's daily gain of 0.18%. At the same time, the Dow lost 0.15%, and the tech-heavy Nasdaq gained 0.5%.

Heading into today, shares of the electric car maker had gained 43.4% over the past month, outpacing the Auto-Tires-Trucks sector's gain of 22.68% and the S&P 500's gain of 3.22% in that time.

Investors will be hoping for strength from TSLA as it approaches its next earnings release. In that report, analysts expect TSLA to post earnings of $0.80 per share. This would mark year-over-year growth of 86.05%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $9.92 billion, up 34.3% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $2.24 per share and revenue of $30.99 billion, which would represent changes of +7366.67% and +26.09%, respectively, from the prior year.

Any recent changes to analyst estimates for TSLA should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

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.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 5.42% 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 282.36. For comparison, its industry has an average Forward P/E of 28.63, which means TSLA is trading at a premium to the group.

We can also see that TSLA currently has a PEG ratio of 8.58. 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 4.31 at yesterday's closing price.

The Automotive - Domestic industry is part of the Auto-Tires-Trucks sector. This industry currently has a Zacks Industry Rank of 32, which puts it in the top 13% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.

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