Baird Analysts Reiterate Outperform Rating on Tesla Ahead of Q2 Earnings Report
In a recent note to investors, Baird analysts reaffirmed their bullish stance on Tesla (NASDAQ: TSLA) shares, highlighting a favorable setup leading into the electric vehicle (EV) maker's Q2 earnings report next week. The analysts expressed optimism about the quarter, citing a more stable pricing environment, increased revenue from full self-driving technology, and a strong performance in the Energy Segment as key drivers of potential success.
One particular event that Baird analysts are eagerly anticipating is the upcoming Robotaxi event, which they believe will serve as a positive catalyst for Tesla stock. The event is expected to shed light on the financial implications of Tesla's Robotaxi product and outline a roadmap for its future deployment. Analysts anticipate an initial rollout of Tesla's Robotaxi fleet in select cities, with limited revenue expected in 2025 but with significant long-term potential.
Additionally, analysts view the unveiling of Tesla's next-generation platform as a near-term driver for the company's shares. The postponement of the event to October has raised speculation that Tesla may introduce new vehicles based on this platform, aligning with CEO Elon Musk's recent comments. Baird models 25,000 next-generation units in 2025, with production slated to begin early in the year.
Looking ahead to Q2 earnings, Baird expects Tesla to exceed consensus estimates for earnings per share (EPS) and corporate gross margin. The analysts project EPS of $0.62, above the consensus forecast of $0.61, and a gross margin of 18.5%, surpassing the consensus estimate of 17.5%. However, Baird's revenue estimate for the quarter is slightly lower at $23.6 billion compared to the consensus of $24.3 billion.
In summary, Baird analysts are bullish on Tesla's prospects for the upcoming quarter, citing positive factors such as a stable pricing environment, increased revenue from full self-driving technology, and the potential impact of the Robotaxi event. The unveiling of Tesla's next-generation platform and the possibility of new vehicle introductions further add to the company's growth potential. Investors may want to keep a close eye on Tesla's Q2 earnings report and upcoming events as they could have a significant impact on the stock's performance.