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Tesla milky guidance sent stocks lower.

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Shares of the electric vehicle giant, Tesla, fell sharply after hours after missing earnings per share. Wall Street was expecting 73 cents, while the company delivered 71 cents. It comes as the company issues a warning on slowing growth rate from 2023.

💰Lack of clear forward guidance🔑

A lack of sales guidance in 2024 gave uncertainty to the company’s outlook. Wall Street is already expecting the growth rate to moderate in 2023, but there needs to be more catalysts for the stock moving ahead without clear guidance.

🚘Update on Full Self-Driving Software📱

In the earnings call, CEO Elon Musk mentioned that no company had licensed its Full Self Driving Software yet despite hinting in previous calls of other automakers considering it. Interestingly, Tesla is also building its robot, Optimus, which is an AI-trained robot to help play a complementary role to human labour and execute jobs seen as too dangerous or repetitive. Elon Musk said there is a likelihood of shipping some of these robots in 2025.

🎲Voting rights and New class of shares prospect🥁

Elon Musk also shared his desire to have at least 25% of the voting rights, which had been the talk of the time. If this is not given, he is considering taking the AI and robotics products into another company instead of creating them at Tesla.

He is also open to having a new class of shares with such extreme voting power. This means the Tesla board can give him less than $30 billion worth of Tesla stocks to achieve the 25% voting power. Such a new class of voting shares will likely need shareholders’ approval.

A cheaper Tesla Model 2 on the horizon?

Can there be a cheaper Tesla car? That has been in the minds of investors. Elon Musk provides some insights into his prediction. He is optimistic that it may happen at the end of 2025, which is within investors’ expectations. While Tesla produced the Cybertruck in 2023, the price point means lower volume and thus, investors are keen for the following product catalysts to spur new growth.

📪What’s on the menu today?🖨

We will have multiple vital economic data releases today.

1) At 8.30 pm, we will welcome continuing jobless claims and core durable goods orders for Dec (Mom). Likewise, expect the GDP (QoQ) result to be out for the fourth quarter.

2) New Home Sales results will be released at 11 pm.

It is on 25 Jan, Thursday, 9.10 am in Singapore and 9.10 pm in New York. Given the pullback in gains, it has been a choppy start to the year, and we wish all friends success in trading and investing.

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