🍎 🍕 Less apples, more pizza 🤔 Have you seen Buffett’s portfolio recently?Explore for Free

Corona what? Tesla retail investors appear unfazed by virus impact

Published 04/29/2020, 07:14 AM
Updated 04/29/2020, 10:00 AM
© Reuters. FILE PHOTO: Tesla Inc CEO Elon Musk attends an opening ceremony for Tesla China-made Model Y program in Shanghai
TSLA
-

By Tina Bellon

(Reuters) - When Tesla (NASDAQ:TSLA) Inc reports first-quarter results after the bell on Wednesday, many individual shareholders will not be looking for details on the subject that drives most conversations: the effect of the novel coronavirus pandemic.

Their view vastly differs from that of traditional analysts and institutional investors, who want to hear updates on Tesla's 2020 cash flow and potential moves to boost demand during a prolonged recession due to the epidemic.

Submitting questions for Tesla's earnings call on a website https://app.saytechnologies.com/tesla?origin=https://ir.tesla.com/events/event-details/tesla-inc-q1-2020-financial-results-and-qa-webcast, retail investors want to learn about Tesla's steps to expand into the robotaxi market, the company's self-driving technology and even plans to create airless tires to reduce maintenance costs.

Of the top 50 questions, only four refer to the novel coronavirus, with one investor asking what safeguards Tesla would implement to protect employees at U.S. factories. Another probed whether Tesla had plans to expand into the grocery delivery market, where demand has skyrocketed during the pandemic.

Tesla Chief Executive Elon Musk early Wednesday morning tweeted "FREE AMERICA NOW" and shared an opinion article arguing that severe lockdown orders have not saved many lives, tweeting "Give people their freedom back."

Analysts expect Musk to provide details on Tesla's plans to restart factory operations after its only U.S. vehicle factory near San Francisco was forced to close at the end of March. The company originally said it would resume operations on May 4, but Bay Area health officials on Monday extended shelter-in-place orders to the end of May.

Investors can vote for a particular question on the website and Tesla management generally answers the most popular ones during an earnings call.

Currently, the No. 1 retail investor question is whether Musk will stick to his target for a 50% compound annual growth rate over the next five to 10 years, or whether a 40% target would be more realistic.

Many analysts expect Tesla to have a compound annual growth rate of around 20%.

Analysts on average expect March quarter revenue to jump 30% to $5.9 billion, according to Refinitiv, down from an initial February estimate of $6.7 billion.

Tesla in early April reported strong vehicle deliveries in the first three months of 2020 - a time when other U.S. carmakers grappled with a slump in sales as virus woes and lockdown restrictions began taking hold.

© Reuters. A Tesla Model X electric car is seen at Brussels Motor Show

The company in mid-February raised $2 billion in a stock offering, and investors on Wednesday will probe whether that covers the company's cash burn at a time when Tesla ramps up production of its new Model Y sport utility vehicle.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.