Tesla's Shocking Q3 Performance

Tesla, a leading electric vehicle (EV) company, faces stock market turbulence as it nears the Q3 2023 earnings report. Despite early September growth, TSLA stock has been consistently volatile, with Q3 deliveries falling 7% below Q2 performance, adding to the uncertainty.

As of now, TSLA stock is down nearly 2% for the day, with trading characterized by significant fluctuations. This downturn isn't surprising considering the disappointing deliveries report. What's more, Wall Street sentiment toward Tesla appears to be deteriorating rapidly, with analysts issuing bearish assessments.

For instance, Ryan Brickman of JPMorgan, while upgrading his per-share forecast to $135 from $120, maintains a "sell" rating, signaling a potential downside of over 45%. Goldman Sachs' Mark Delaney adjusted his price target to $252 and rates the stock as a "hold." William Stein of Truist Financial also lowered his TSLA stock price target to $243, keeping a "hold" rating.

Toni Sacconaghi, an analyst at Bernstein, has consistently rated Tesla as a "sell" with a price target of $150. He expresses concerns about Tesla's auto gross margins, expecting declines due to lower volumes and significant discounts on inventory cars. He also notes demand issues and a lack of new high-volume products, suggesting potential price reductions next year to increase sales, even if it impacts profit margins.

In the aggregate, TSLA stock maintains a "moderate buy" consensus on TipRanks, with 12 Wall Street analysts rating it as a buy, 12 as a hold, and four as a sell.

Looking ahead, according to Sacconaghi, Tesla needs to deliver a robust Q4 and possibly implement additional price reductions to meet its FY 2023 delivery forecast. Achieving this goal would position the company favorably for 2024, although the forecast has already been adjusted downward. However, the recent deliveries miss has done little to instill confidence in Tesla's progress as per Wall Street's expectations. Price targets are being revised downward in anticipation of the upcoming earnings report.

Deutsche Bank's prediction of a Q3 deliveries miss has now materialized, further diminishing optimism among analysts. Until the Q3 earnings report on October 18th, Tesla is likely to remain shrouded in uncertainty as investors eagerly await insights into its Q3 performance.