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Tesla Q4 earnings reaction: 'Train wreck' call, production warning hit stock

Jan 25, 2024 - markets.businessinsider.com
Tesla's Q4 earnings report disappointed investors, leading to a $50 billion loss in market value. The company reported lower-than-expected profits and revenue, and warned of a production slowdown. Wall Street analysts have expressed concerns about the company's future, with some describing the earnings call as a "train wreck". Analysts from Wedbush Securities, G Squared Private Wealth, and Deepwater Asset Management all expressed concerns about Tesla's vague guidance, lack of focus on car manufacturing, and potential identity crisis as it pivots towards AI.

Despite the concerns, some analysts remain optimistic about Tesla's long-term prospects. Wedbush Securities believes that EV adoption is around the corner and that Tesla's long-term story remains intact. Deepwater Asset Management's Gene Munster believes that while Tesla's growth may slow this year, it could see a 30% growth in 2025 due to the anticipated release of Tesla's next-gen vehicle. However, the near-term outlook remains uncertain, with concerns about price cuts, lack of clear guidance, and communication from Tesla's management.

Key takeaways:

  • Tesla's fourth-quarter earnings report disappointed investors, leading to a steep sell-off on Wall Street and erasing $50 billion in market value.
  • Analysts criticized the earnings call as a 'train wreck', pointing to vague guidance on profit margins and expensive structure. However, some remain bullish on Tesla's long-term prospects.
  • Victoria Greene from G Squared Private Wealth suggested Tesla may be losing focus on its core business of manufacturing cars, as the earnings call focused heavily on AI and future projects.
  • Gene Munster from Deepwater Asset Management said the results have dampened optimism for the stock's most bullish investors, predicting a possible 5% to 10% drop in the stock this year. However, he believes Tesla's growth momentum could return in a year.
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