Tesla Stock Falls Nearly 3% In Thursday Pre-Market — But Key Metrics Point To Explosive Growth Potential
Tesla Inc. (NASDAQ:TSLA) stock fell 2.89% in pre-market trading after missing quarterly EPS expectations for the fourth consecutive time. Despite a 12% year-over-year revenue increase to $28.095 billion, EPS of 50 cents was below the expected 54 cents. Concerns about strategic focus were raised, although analysts noted the company's strong balance sheet with $41 billion in cash. Key metrics indicate potential growth, with high ratings in momentum, growth, and quality according to Benzinga's rankings.
Tesla Inc. (NASDAQ:TSLA) stock declined 2.89% before the bell on Thursday, as the EV maker missed Wall Street’s quarterly earnings per share (EPS) expectations.
Fourth Consecutive EPS Miss
Tesla reported third-quarter revenues of $28.095 billion, marking a 12% year-over-year increase, and surpassing the Street’s consensus estimate of $26.239 billion.
However, EPS of 50 cents came in below the Street’s estimate of 54 cents— marking the fourth consecutive miss on expectations. This was in part due to tariff and research costs, as well as a drop in income from regulatory credits that are expected to continue to fade away with recent legislation passed by the Trump administration.
Operating income plummeted 40% year-over-year to $1.6 billion, with an operating margin of 5.8%.
Mixed Wall Street Reactions
Gene Munster, managing partner at Deepwater Asset Management, highlighted Tesla’s balance sheet strength, noting that its cash and liquidity increased by $4 billion during the quarter to $41 billion. Meanwhile, Wedbush analyst Dan Ives called this the company's "golden chapter."
However, concerns have been raised about Tesla’s strategic focus. Ross Gerber, co-founder of investment firm Gerber Kawasaki, believes that Tesla’s shift away from EVs could be a strategic error for the company. Despite this, his firm still holds over “$80 million” in Tesla stock for clients.
Gary Black, managing director of Future Fund LLC, also expressed concerns about Tesla’s future. He stated that CEO Elon Musk‘s comments about the future did little to boost investor confidence following the mixed Q3 earnings report.
Key Metrics Denote Strength
Tesla holds a momentum rating of 92.39%, a growth rating of 76.06% and a quality rating of 73.72%.
