Q1 earnings could lead to a final near-term cut for Tesla estimates - Oppenheimer

investing.com:

Oppenheimer analysts have revised their delivery forecasts for Tesla (NASDAQ:TSLA), reducing their initial estimates.

For the first quarter of 2024, the broker now projects deliveries to be 468,000 vehicles, down from 509,000, and has lowered its full-year 2024 delivery prediction to 2.13 million vehicles from 2.17 million.

As a result, analysts anticipate Tesla's 2024 revenue to be $109.8 billion, with adjusted earnings per share (EPS) of $3.01, a decrease from their previous forecasts of $112.3 billion in revenue and an adjusted EPS of $3.10.

Meanwhile, their projections for 2025 and 2026 remain unchanged at $141.7 billion with an EPS of $4.35 and $173.3 billion with an EPS of $5.67, respectively.

Following Tesla's announcement of upcoming price hikes across various markets and emerging reports of scaled-back production in China, it appears the company is prioritizing the delivery of as many vehicles as possible before the quarter concludes, Oppenheimer analysts said in a Monday note.

This strategy suggests a shift in Tesla's focus towards enhancing the value captured per vehicle, moving away from a sole emphasis on increasing the number of units sold.

“With TSLA signaling an acceleration in FSD development after major investments in compute power and a wider roll-out of V12 FSD, allowing for accelerated system training with real world data, we believe the company is setting the stage for increased software driven revenue growth as it prepares to launch the Model 2,” analysts noted.

“As we trim estimates, we believe the 1Q24 report could lead to a final near-term cut on TSLA estimates,” they added.