Due to Tesla's reported gap in the number of cars produced and delivered, a miss on revenue expectations in Q3, as well as a decline in share prices, some investors and analysts are worried. However, the company is now experiencing not more than “just a bump in the road” and its value is to increase in the years to come, Loup Funds believes.
Tesla's Q3 2022 results drew mixed reactions from investors and analysts. The company previously reported that it had produced about 20,000 more vehicles than it had delivered, which raised concerns about demand even though it was untrue. In addition, Tesla reported a miss on Q3 revenue expectations by 2%, which was unexpected as its investors are accustomed to the manufacturer exceeding expectations over the past 2.5 years. As a result, TSLA shares were down around 6% in after-hours trading after the earnings report was released last week. While some investors and analysts are worried that the share price has declined, others are taking the opportunity to add even more of the valuable shares to their portfolios.
Loup Funds believes that at this time there is no real reason to worry about whether Tesla can grow and develop. About 5% of car sales today are electric vehicles, and in the next twenty years this figure will grow to 100%, stressed Managing Loup Funds Partner Gene Munster. While traditional automakers are still facing challenges trying to modernize EV production instead of producing legacy gas-powered vehicles, Tesla still offers the best value EVs for the money, and no other car maker has optionality around storage, solar, and robotics.
Munster said Q3 was “just a bump in the road”for Tesla. He already said the same thing in 2018 to describe the company's struggle to increase Model 3 production, and, as a practice has shown, he was right. While he does not expect TSLA's stock to vertical lift like in 2020, he expects the company's value to rise in the coming years as they maintain leadership towards these undeniable trends.
© 2022, Eva Fox | Tesmanian. All rights reserved.
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About the Author
Eva Fox joined Tesmanian in 2019 to cover breaking news as an automotive journalist. The main topics that she covers are clean energy and electric vehicles. As a journalist, Eva is specialized in Tesla and topics related to the work and development of the company.