Tesla posts it highest profit beat in Q1; shares climb

Tesla posts it highest profit beat in Q1; shares climb
Published - Apr 22, 2022 @ 12:36 PM (EET)

After the electric-vehicle maker posted its highest quarterly profit yet this week, Tesla Inc. (NASDAQ:TSLA) shares climbed Thursday, up 3.2% at $1,008.78.


The blowout first-quarter results significantly topped revenues, soaring 81% year-over-year.  Net income in the quarter was $3.3 billion. The beat was driven mainly by EV deliveries, higher pricing, and reduced costs which offset inflationary pressures, rising input costs, and supply chain challenges.


Vehicles deliveries came in at 310,000 globally for the quarter, up from 184,877, or 68% from a year-ago quarter, while operating margins improved substantially, hitting 19.2% compared to 5.7%.


Though management noted that supply chain constraints and chip shortages, posed by the stop-start emergence of the world economy from Covid-19 lockdowns, continue to cause difficulties.


"I think the official numbers actually understate the true magnitude of inflation." - CEO Elon Musk at Tesla


Elsewhere, Tesla said it plans to grow its manufacturing capacity "as quickly as possible" and aims to achieve 50% annual growth in deliveries over a multi-year horizon.


While investors have had some concern over that projection due to a halt in operations at the company's Shanghai manufacturing facility, Tesla said the plant restarted production, albeit at a limited capacity.  Moreover, to help spur that growth, Tesla has also opened plants in Germany and Austin, giving investors confidence that the company will achieve its goals.


Tesla posted automotive revenues of $16.86 billion for the quarter, producing 36% of the automotive earnings it achieved throughout 2021. Adjusted diluted non-GAAP earnings per share (EPS) came in at $3.22 for the quarter, with a market capitalization of $1.08 trillion.



TURNING TO WALL STREET


Following an impressive quarterly beat, analyst Joseph Spak at RBC Capital increased Tesla's price target from $1,035 to $1,175.00 and reiterated a Hold rating.


The Bank of America, with a Neutral rating, said that operating revenue came in slightly ahead of estimates due to stronger gross revenues, better operational performance, and higher regulatory credits.


Overall, consensus among analysts for Tesla stock is a Moderate Buy based on 15 Buys and five Holds.


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