Sign InSummary
As of September 25, 2023, Tesla's fundamental analysis shows a high valuation and positive profit generation, while technical analysis indicates a recent downward trend but a longer-term upward trend, and price predictions suggest slight undervaluation and potential upside, leading to a 'Buy' recommendation.
Fundamental Analysis
As of September 25, 2023, Tesla, Inc. had a market capitalization of $783.94 billion and outstanding shares of approximately 3.17 billion. The trailing Price/Earnings (P/E) ratio lies at 72.01, which indicates a significantly higher valuation compared to industry norms – a typical manifestation of high growth expectations from the market. The earnings per share (EPS) for the company rests at $3.43, demonstrating its ability to generate profits.
In recent news, Tesla is expected to report its Q3 deliveries soon. Despite analysts slashing delivery forecasts ahead of the announcement, it is important to monitor this as a significant decrease might negatively impact the stock's performance. Furthermore, the ongoing UAW strike potentially presents an opportunity for Tesla as it might stand to gain from any disruptions facing its competition.
The consensus among a reported 32 analysts leans towards 'Buy' with 22 recommending a 'Buy,' seven holding a 'Hold' position, two suggesting 'Sell' and one voting a 'strong buy.' These recommendations suggest an overall optimistic sentiment toward Tesla as an investment.
Technical Analysis
Tesla's last close was at $246.99 on September 25, 2023, which reflects a 0.86% increase from the previous trading day. The stock experienced a low and high of $238.31 and $247.1, respectively, on this day. The stock has fluctuated within the range of $101.81 (year low) and $299.29 (year high) over the past year.
The 50-day moving average (MA) of Tesla is $255.04, which is higher than the last closing price, suggesting a recent downward trend. However, comparing the last close to the 200-day MA of $204.04, it's considerably higher, indicating a longer-term upward trend. The Relative Strength Index (RSI14) is at 44, which does not presently indicate overbought or oversold conditions.
On top of these, Tesla's Moving Average Convergence Divergence (MACD) over 3 months stands at 13.13, which can be read as a bullish signal, suggesting the stock's momentum is moving towards upward price movement.
Price Predictions & Valuations
The Discounted Cash Flow (DCF) approach yields a fair value of $253.37 for Tesla's stock, which suggests a slight undervaluation at the present closing price of $246.99.
The analyst consensus indicates a broad target price range for Tesla, from a low of $130 to the much higher target price of $526.67, with a median target price of $280. This suggests potential upside in the stock's price.
Conclusion
Taking into account both the fundamental indicators of company health and the technical study reflecting market behavior towards Tesla's stock, the analysis suggests a 'Buy' position. This is due to the company's promising market position and stronger long-term price trend. However, volatility may be expected, given Tesla's susceptibility to news events. Therefore, while the stock offers potential for upward mobility, investors should proceed with caution and attentiveness to Tesla's news and quarterly delivery results.
