Tesla share price: what's the outlook after worst ever start to a year?
The electric car company faces delivery challenges and a tumbling stock price throughout 2019.
Tesla share price is slightly rebounding after the company's shares fell 43% this year. The electric car company’s stock is trying to recover after a worse-than-expected Q1 earnings report, struggles meeting vehicle shipment deadlines, and reports of declining auto sales.
Tesla shares rise after cutting vehicle prices
Tesla’s Model 3 sales jumped from 10,050 in April to 13,950 in May after the corporation cut the cost of the vehicle to $35,000. Chief executive officer (CEO), Elon Musk, noted in an email to employees that investors still supported Tesla despite reporting large losses in Q1.
‘It is important to bear in mind that we lost $700 million in the first quarter this year, which is over $200 million per month. Investors nonetheless were supportive of our efforts and agreed to give us $2.4 billion (our net proceeds) to show that we can be financially sustainable’, said Musk.
How will Tesla shares perform before manufacturing the Model Y in California?
Tesla hopes to increase sales with its upcoming Model Y sport utility vehicle (SUV). Musk said that the car company has restructured its Fremont, California factory to ramp up production of the SUV.
‘Right now our default plan actually is to produce the [Model] Y at Fremont. I was sceptical about whether this made sense at first, but my team convinced me the fastest way to get to volume production is to do the Y at Fremont,’ said Musk.
Cornerstone Macro technical analyst, Carter Worth, believes that Tesla shares have fallen so much that the stock is a buy for investors. Worth is taking a contrarian view of the stock.
‘Tesla has undershot by such an amount that actually it’s so bad, it’s good,’ said Worth.
Tesla has positive 2019 outlook
Despite Tesla's current challenges, the corporation has a positive outlook for 2019 vehicle deliveries. Tesla forecast 360,000 - 400,000 car deliveries for the year. The corporation also predicts 45-65% year-over-year growth in 2019.
IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.
The information/research herein is prepared by IG Asia Pte Ltd (IGA) and its foreign affiliated companies (collectively known as the IG Group) and is intended for general circulation only. It does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. You should take into account your specific investment objectives, financial situation, and particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit.
Please see important Research Disclaimer.
Seize a share opportunity today
Go long or short on thousands of international stocks.
- Increase your market exposure with leverage
- Get spreads from just 0.1% on major global shares
- Trade CFDs straight into order books with direct market access
Live prices on most popular markets
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.