Hard to Believe, but Tesla's (NASDAQ:TSLA) High Growth may be Just Beginning

Goran Damchevski
3 min read
5
In this article:

This article was originally published on Simply Wall St News

Today, Tesla (NASDAQ:TSLA) released the Q3 vehicle production and distribution numbers, which is a great time to re-evaluate the fundamentals and see where the company is heading.

As long-term investors know, share price is up a whopping 1,871% in the last half decade, giving most investors a handsome return for holding the stock even a few years. It's also good to see the share price up 14% over the last quarter, which means that the stock has a powerful force behind it which has not interest in selling anytime soon.

With that in mind, it's worth seeing if the company's underlying fundamentals have been the driver of long-term performance, or if there are some discrepancies.

Check out our latest analysis for Tesla

We start with today's new vehicle deliveries report, which shows the company making record-breaking deliveries of 241,300 vehicles in total.

We aggregated the numbers by quarter in order to get a better sense of the trend in deliveries. As it many not surprise many investors, the model 3/Y currently dominates demand.

tesla-vehicle-deliveries
tesla-vehicle-deliveries

Fundamentals

Given that Tesla only made minimal earnings in the last twelve months, we'll focus on revenue to gauge its business development. Generally speaking, Tesla is currently in a high-growth & high-reinvestment phase.

The vehicles are in demand and the company must consistently re-invest in production and supply chain capacity in order to reach a mature phase and become a general vehicle (not just EV) market leader. This will take a few years as the autopilot systems are being worked on, and the factories are being expanded.

Growth is looking good and for the last half decade, Tesla can boast revenue growth at a rate of 34% per year.

Fortunately, the market has not missed this, and has pushed the share price up by 82% per year in that time. Despite the strong run, top performers like Tesla have been known to go on winning longer than skeptics can stay solvent.

By looking at what analysts estimate for the future, we come up with a picture that shows a growing company, and perhaps even a few positive surprises in the years to come.

The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).

earnings-and-revenue-growth
earnings-and-revenue-growth

It is great to see that in just two years, analysts are expecting revenues to be close to double their value from today. This picture outlines that Tesla's future is in front of the company.

Tesla is a well known stock, with plenty of analyst coverage, suggesting some visibility into future growth. So we recommend checking out this free report showing consensus forecasts

Key Takeaways

It's good to see that Tesla has rewarded shareholders with a total return of 87% in the last twelve months. Therefore, it seems like sentiment around the company is still positive, despite all the fluctuations.

The company is making good on its promises and delivering an increasing number of vehicles, further bolstering confidence in the product demand and the production capacity of Tesla. Analysts are forecasting constant growth, as the company keeps expanding and re-investing resources.

It's always interesting to track share price performance over the longer term. But to understand Tesla better, we need to consider many other factors. For instance, we've identified 1 warning sign for Tesla that you should be aware of.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of companies we expect will grow earnings.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US exchanges.

Simply Wall St analyst Goran Damchevski and Simply Wall St have no position in any of the companies mentioned. This article is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com

Advertisement

Recommended Stories

  • Sam Bankman-Fried Traded In His $35 Million Mansion In The Bahamas For A Prison Cell With 35 Inmates But Claims "He Did Not Do Anything Wrong"

    Formerly disgraced FTX CEO and Co-Founder Sam Bankman-Fried was convicted in November of wire fraud, money laundering and conspiracy, and sentenced to 25 years in prison. His high-profile trial marked a significant chapter in the unraveling of FTX, which collapsed under suspicious financial practices, leading to intense scrutiny and legal action. For the first time since his incarceration, Bankman-Fried described his daily life in a detailed interview with journalist William D. Cohan of Puck. Do

  • Charles Schwab website ‘is a mess’: Hundreds of TD Ameritrade users complain about their new online home.

    “It wouldn’t surprise me if they see an outflow of clients over the next six months,” one user told MarketWatch.

  • Homes are overvalued in much of the U.S. — with these 5 states leading the list

    Home prices are overvalued nationally, according to a new report by Fitch Ratings, led by Southern states.

  • Nvidia Recently Bought 5 Artificial Intelligence (AI) Stocks, and 1 Is Absolutely Soaring

    Nvidia is spreading some of its recently amassed wealth by investing in smaller AI companies.

  • Exclusive-Bank of America banker who died had sought to leave, citing long hours, recruiter says

    The 35-year-old Bank of America investment banker who died from a blood clot earlier this month wanted to leave the U.S. bank because he was working more than 100 hours a week, according to an executive recruiter who spoke with him about seeking a new job. Junior banker Leo Lukenas III died of an acute coronary artery thrombus, a type of blood clot, the New York Office of the Chief Medical Examiner said last week. Lukenas said in mid-March that he wanted to leave Bank of America because of the grueling hours, Douglas Walters, a managing partner at GrayFox Recruitment, told Reuters in an interview.

  • Seeking 12% Dividend Yield? Analysts Suggest 2 Dividend Stocks to Buy

    Now that we’ve had time to digest the April jobs numbers, some strategists are getting worried about the economy’s mid-term outlook. The jobs report showed 175,000 new jobs added in the month – but that was the lowest gain in the past six months, and was accompanied by an uptick in unemployment, from 3.8% to 3.9%. Along with these topline numbers, the report showed declines in job openings and hires. For Roukaya Ibrahim, watching the US economy from BCA, this job report may indicate a shift towa

  • The 3M Dividend Cut Is Here. It’s Big.

    STOCKSTOWATCHTODAY BLOG It’s official. 3M cut its dividend significantly. The materials company declared a dividend of 70 cents per share on Tuesday evening. That’s down from the prior quarter’s dividend of $1.

  • Smartphones Are About to Get an AI Boost. Here Are the Stocks to Play the Revolution.

    “You could almost argue that the smartphone is becoming a little bit closer to a washing machine than the cutting-edge, rapidly changing device category that it used to be,” says Ben Wood, chief analyst at CCS Insight, a technology research firm. Samsung Electronics and Alphabet Google, which have spent years partnering on mobile phones—and the Android software that powers them—see a silver bullet in the form of artificial intelligence. “This new era of AI is a profound opportunity to make smartphones truly smart,” Sameer Samat, Google’s vice president of product management for Android, said during the Google I/O developers conference on Tuesday.

  • What is a high-net-worth individual?

    High-net-worth individuals, those with net worths of $1 million or more and liquid assets, take different approaches to finance than others.

  • 4 Top Stocks to Tap Nasdaq's New All-Time High

    Stocks like Netflix, Inc. (NFLX), Alphabet Inc. (GOOGL), NVIDIA Corporation (NVDA) and Super Micro Computer, Inc. (SMCI) are expected to benefit from the ongoing Nasdaq rally.