Tesla shares are tanking for several reasons including a big recall and more questions about Autopilot stocks Tesla shares drop after its big Model S recall and more questions about Autopilot
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Is Tesla’s returns on stock too high?
Nov 10, 2021 · Why is the Tesla share price tanking? ... Musk's Twitter poll comes at a time when he, the world’s richest man, is in line to receive a chunk …
How has Tesla's stock performed over the last 10 years?
Mar 11, 2022 · It looks like Friday is going to end the week on another down note for Tesla ( TSLA-3.00%). As of 12:10 p.m. ET, Tesla stock is down 4.2% -- a much steeper fall than the Nasdaq's overall 1.1% decline.
Why is Tesla stock one to avoid in 2022?
Jan 27, 2022 · Why Tesla Stock Tumbled 7.5% Today By Rich Smith - Jan 27, 2022 at 12:46PM You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services.
Why did Tesla’s shares plummet?
Mar 23, 2022 · Why Tesla Stock Went Up Again By Rich Smith - Mar 23, 2022 at 12:00PM You’re reading a free article with opinions that may differ from …
Tesla crushed on earnings -- but also crushed investor hopes for new car models in 2022
I like things that go "boom." Sonic or otherwise, that means I tend to gravitate towards defense and aerospace stocks. But to tell the truth, over the course of a dozen years writing for The Motley Fool, I have covered -- and continue to cover -- everything from retailers to consumer goods stocks, and from tech to banks to insurers as well.
What happened
Shares of electric car titan Tesla ( NASDAQ:TSLA) braked hard Thursday morning, falling 7.1% through 11:30 a.m. ET.
Now what
Investors, however, don't seem as impressed with what Tesla has "done for them lately." What really concerns them are what Tesla plans to accomplish in 2022. (And admittedly, with Tesla stock trading for 330 times earnings, that's a valid concern.)
Who is the CEO of Whole Foods Market?
John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Rich Smith has no position in any of the stocks mentioned.
How much is Rivian worth?
So what. Rivian seeks to go public as early as September, Bloomberg reports, targeting a $50 billion valuation initially. That may not sound like much of a threat to Tesla, which is currently valued at nearly $800 billion.
Is Rivian a competitor to Tesla?
But Bloomberg said that Rivian is "one of the highest-profile potential competitors to Tesla" and has raised more than $8 billion to date from investors. This suggests that interest in Rivian could siphon away some of Tesla's stock market enthusiasm.
NASDAQ: TSLA
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The stock has been a big winner over the past five years, but expectations are too high for this company going forward
Tesla 's ( TSLA 1.14% ) stock performance over the last decade has been nothing short of exceptional. Shares are up almost 23,000% in the last 10 years alone, making it one of the top-performing stocks in the market during that timespan.
Growth has been solid
Let's start with what Tesla has done with its business over the last five years. It recently posted record car deliveries of 936,000 in 2021, up from a measly 30,000 in 2017. Revenue has followed suit. Trailing 12-month sales are up 448% in the last five years, as Tesla has scaled its manufacturing business around the globe.
NASDAQ: TSLA
The company should do over $50 billion in sales in 2021, and analysts expect revenue to get close to $100 billion in 2023. So why is Tesla stock one to avoid in 2022? Two reasons: the difficulty of manufacturing and the expectations embedded in the stock.
Manufacturing is a difficult business
Bending steel is difficult. Building and selling cars is difficult, and it costs a lot of money. Tesla (a car manufacturer) is not immune to these costs, and they will make it difficult for the company to return cash to shareholders over the long term -- which is how you accrue value as an owner of the stock.
Expectations are much too high
Given the difficult nature of an automotive manufacturing business, most of the sector's stocks trade at dirt-cheap earnings multiples. This will likely be true of Tesla at some point. Let's look at Toyota again as an example. The company, which did $281 billion in revenue over the past 12 months, generated $28.2 billion in net income.
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Tesla Stock Forecast
This is a classic macro versus technical divergence. The macro picture looks strained. TSLA stock will find it difficult to make any headway with such a strong macro picture, but technically resistance at $945 looks like it could break. That may be unlikely, but it is worth pointing out just in case.
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US Markit PMIs Preview: Services sector has room for upside surprise, boosting the dollar Premium
Markit's Services PMI is expected to rise to only 53 points, barely in growth territory. America's largest sector has likely rebounded much faster from the Omicron-related slowdown. The dollar has room to rise in response to the data.
