Why the Tesla share price rose 4.43% on Monday

Following a firm beat on analyst Q1 delivery targets, the Tesla share price rose on Monday, finishing out the session at $691 per share.

  • Tesla smashed Q1 delivery estimates, +185k vs EST. +168k
  • Model 3/Y production continues to improve, while there was no Model X/S production in Q1
  • Daniel Ives described this result as a ‘drop the mic moment’ for the company
  • Trade stocks like Tesla long or short with IG now. Click here to create an account.

Production + Delivery Results

Tesla (ticker: TSLA) and its bombastic CEO Elon Musk look to have taken a softer approach to the release of its latest quarterly production and delivery results, reporting them on Friday April 2, while the market was closed.

Overall, the automaker revealed that it had produced ~185,000 vehicles and delivered ~180,000 during the first quarter of 2021.

That’s a substantial beat on what Wall Street was expecting. The Analyst consensus was for Tesla to deliver just 168,000 vehicles during the first quarter – according to FactSet.

The market reacted positively to this news, bidding the stock 4.43% higher on Monday. Tesla closed Monday’s session at $691.05 per share.

The company said its Q1 performance was boosted by the positive reception of its vehicles in China, noting that:

‘We are encouraged by the strong reception of the Model Y in China and are quickly progressing to full production capacity.’

Despite already topping Wall Street’s estimates, Tesla management added that:

‘Our delivery count should be viewed as slightly conservative, as we only count a car as delivered if it is transferred to the customer and all paperwork is correct. Final numbers could vary by up to 0.5% or more.’

Model X/S?

Looking at this beat in more detail, Tesla’s delivery performance was driven by strong demand for its Model 3 and Model Y vehicles.

All up, during the first quarter of 2021, Tesla delivered 182,780 of the Model 3 and Model Y and 2,020 of the Model X and Model S. That’s a significant shakeup from the year prior, which saw the automaker deliver 12,200 and produce 15,390 of the Model S and Model X.

In fact, Tesla produced no Model S and Model X vehicles in the first quarter of 2021, nor did it explain this lack of production. The company did however say that:

‘The new Model S and Model X have also been exceptionally well received, with the new equipment installed and tested in Q1 and we are in the early stages of ramping production.’

Tesla share price ↑

Despite Tesla rising firmly overnight, the stock remains firmly off its 52-week high.

With fears of rising inflation and interest rates spooking investors, high multiple stocks such as Tesla have faced the brunt of this anxiety, with the stock down around 5% year-to-date.

Over the last year, the stock has been far and away one of the best performing US big-caps, gaining over 540% in that period. At its peak, Tesla hit a market capitalisation of $849 billion on January 26, making it one of the most valuable publicly listed companies in the world. Plus, pullback or not, many remain optimistic over Tesla’s future.

In fact, Dan Ives from Wedbush Securities went as far to describe these latest production figures as a ‘drop the mic moment’ for Tesla, adding that the automaker ‘yet again defied the skeptics and bears’.

It will be interesting to see if this optimism persists on Tuesday.

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