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Wells Fargo expects Tesla to miss Q1 estimates

Published 04/12/2024, 11:08 AM
Updated 04/12/2024, 11:10 AM
© Reuters.  Wells Fargo expects Tesla (TSLA) to miss Q1 estimates

Wells Fargo analysts said in a note Friday that they expect Tesla (NASDAQ:TSLA) to miss first-quarter expectations when it reports on April 23.

Despite the anticipated miss, the investment bank acknowledges that expectations for Tesla's release are low after weak deliveries during the quarter.

"We are forecasting Q1 EPS of $0.40, below consensus of $0.54," said Wells Fargo. "Our below consensus EPS reflects the px cuts, lower deliveries, labor inflation & worse op leverage. We also lower our FY EPS by 20% to reflect the low Q1 delivery pace."

While Wells Fargo also stated that the company's poor fundamentals may be overshadowed on the first quarter call by Full Self-Driving "razzle-dazzle," they believe that once the show is over, "fundamentals should matter again."

"Despite poor deliveries & new Model 2 doubts, MTD [month-to-date] TSLA is only -2% (S&P -2%). Robotaxi has helped (now 8/8 reveal). With weak Q1 fundamentals, TSLA likely stays focused on FSD v12.3.3, based on a neural-nets & receiving positive reviews. We see hyping Robotaxi as risky," added the bank.

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