Tesla spikes 9% after a 2nd straight blockbuster earnings report
- Tesla shares spiked as much as 9% on Thursday after the automaker beat analysts' fourth-quarter profit and revenue estimates.
- The company also accelerated its rollout for the Model Y crossover, announcing deliveries will start by the end of March.
- The earnings win extended Tesla's rally through the new year. The stock is already up about 52% after hitting numerous record highs in 2020.
- Watch Tesla trade live here.
Tesla stock soared as much as 9% on Thursday after the automaker trounced Wall Street's expectations with its fourth-quarter figures.
The company topped analyst estimates for both quarterly profit and revenue, and posted a second-consecutive quarter of profitability. Tesla expects 2020 deliveries to "comfortably exceed" 500,000, quashing analysts' once-prevalent supply fears. The estimate marks a 36% delivery increase from the 367,500 total in 2019.
Tesla again announced it was ahead of schedule in rolling out its Model Y crossover, revealing a "production ramp" began in January and deliveries will begin by the end of March.
Here are the key numbers:
Revenue: $7.4 billion, versus the $7.1 billion estimate
Earnings-per-share: $2.14, versus the $1.74 estimate
Gross margin: 18.8%, versus the 18.3% estimate
"In 2019, we managed to generate more than $1 billion of free cash flow while building a factory in Shanghai in record time and while building parts of Model Y production," CEO Elon Musk said in a call with analysts. "For us to have this level of free cash flow while making massive investments in capacity while developing new products, while improving the core engineering, is a testament to the, I think, incredible performance of the Tesla team."
Tesla shares have nearly tripled from prices seen as recently as October, and are up about 52% year-to-date. The company's last earnings report posted a surprising return to profitability and a positive update for Tesla's production of vehicles in China. Tesla stock jumped as much as 17% following the third-quarter report.
The rosy fourth-quarter figures prompted a spate of analyst upgrades. The company's continued profitability and "healthy cash flow" made for a "potentially game-changing" report, Wedbush analyst Dan Ives wrote. The Tesla bull maintained a "neutral" rating for the stock but lifted his price target to $710 per share from $550.
The automaker should easily surpass 500,000 deliveries in the new year, and ramping up production in China could drive the stock to $1,000 in the long term, Ives added.
Tesla closed at $580.99 per share Wednesday.
The company has nine "buy" ratings, 10 "hold" ratings, and 18 "sell" ratings, with a consensus estimate of $431.56, according to Bloomberg data.
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