Investor Report – A Quick Update for TSLA Shareholders

Tesla logged a 3.6% change during today's morning session, and is now trading at a price of $255.33 per share.

Tesla returned gains of 6.0% last year, with its stock price reaching a high of $299.29 and a low of $101.81. Over the same period, the stock underperformed the S&P 500 index by -7.0%. As of April 2023, the company's 50-day average price was $250.61. Tesla, Inc. designs, develops, manufactures, leases, and sells electric vehicles, and energy generation and storage systems in the United States, China, and internationally. Based in Austin, TX, the large-cap Consumer Discretionary company has 127,855 full time employees. Tesla has not offered a dividend during the last year.

The Company Has a Positive Net Current Asset Value:

2018-02-23 2019-02-19 2020-04-28 2021-02-08 2022-02-07 2023-01-31
Revenue (MM) $11,759 $21,461 $24,578 $31,536 $53,823 $81,462
Gross Margins 19.0% 19.0% 17.0% 21.0% 25.0% 26.0%
Operating Margins -14% -1% 0% 6% 12% 17%
Net Margins -17.0% -5.0% -4.0% 2.0% 10.0% 15.0%
Net Income (MM) -$1,961 -$976 -$862 $721 $5,519 $12,556
Net Interest Expense (MM) -$452 -$639 -$641 -$718 -$315 $106
Depreciation & Amort. (MM) -$1,636 -$1,901 -$2,154 -$2,322 -$2,911 -$3,747
Earnings Per Share -$0.79 -$0.38 -$0.32 $0.22 $1.64 $3.71
EPS Growth n/a 51.9% 15.79% 168.75% 645.45% 126.22%
Diluted Shares (MM) 2,486 2,558 2,655 3,249 3,369 3,387
Free Cash Flow (MM) $4,021 $4,417 $3,842 $9,185 $18,011 $21,896
Capital Expenditures (MM) -$4,081 -$2,319 -$1,437 -$3,242 -$6,514 -$7,172
Net Current Assets (MM) -$16,452 -$15,120 -$14,096 -$1,701 -$3,448 $4,477
Long Term Debt (MM) $9,418 $9,404 $11,634 $9,556 $5,245 $1,597
Net Debt / EBITDA 1773.54 5.03 3.2 -1.78 -1.16 -1.09

Tesla has exceptional EPS growth, a pattern of improving cash flows, and wider gross margins than its peer group. However, the firm suffers from weak operating margins with a positive growth rate and a highly leveraged balance sheet. Finally, we note that Tesla has weak revenue growth and a flat capital expenditure trend and just enough current assets to cover current liabilities.

Tesla Has Elevated P/B and P/E Ratios:

Tesla has a trailing twelve month P/E ratio of 71.2, compared to an average of 22.33 for the Consumer Discretionary sector. Based on its EPS guidance of $4.43, the company has a forward P/E ratio of 56.6. Tesla's PEG ratio is 6.53 on the basis of the 10.9% weighted average of the company and the broader market's EPS compound average growth rates. This suggests that the company's shares are overvalued. Furthermore, Tesla is likely overvalued compared to the book value of its equity, since its P/B ratio of 15.85 is higher than the sector average of 3.12. The company's shares are currently trading 659.2% above their Graham number.

Tesla Has an Average Rating of Hold:

The 37 analysts following Tesla have set target prices ranging from $24.33 to $400.0 per share, for an average of $237.04 with a hold rating. As of April 2023, the company is trading 5.7% away from its average target price, indicating that there is an analyst consensus of little upside potential.

Tesla has an average amount of shares sold short because 3.1% of the company's shares are sold short. Institutions own 44.2% of the company's shares, and the insider ownership rate stands at 13.04%, suggesting a large amount of insider shareholders. The largest shareholder is Vanguard Group Inc, whose 7% stake in the company is worth $56,807,300,445.

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.