By Michael Elkins
Deutsche Bank reiterated a Buy rating and $400 price target on Tesla Inc (NASDAQ:TSLA) ahead of the electric vehicle maker’s 3Q22 delivery and production report. Tesla is slated to report 3Q22 deliveries and production figures this weekend.
Deutsche Bank maintained their 3Q delivery estimate of 367k units, reflecting a strong recovery from Q2’s prolonged COVID-related shutdown and logistical challenges in the Shanghai factory as well as the ramp-up of volume from both the Berlin and Texas factories. 3Q revenue estimates stayed the same at $22.9 billion, while EPS estimates were raised from $1.11 to $1.14. This is roughly aligned with consensus revenue of $22.7 billion and higher than the Street’s EPS forecast of $1.06.
This update also comes ahead of Tesla’s AI Day on Friday. Deutsche Bank analysts believe investors and the broader Tesla fan community will look for an update on FSD beta, robotaxi, and other AI-related programs such as the Optimus robot. At the company’s earnings, they expect Tesla to provide an update on its efforts to ramp up production in Berlin and Texas, as well as the latest production status of its 4680 cells.
Furthermore, Tesla CEO Elon Musk had commented that the Cybertruck is on track to begin volume production next year and confirmed that the company will be working on the development of a robotaxi to launch in the years that follow.
Lastly, Deutsche Bank also anticipates investors will seek more clarity on Tesla’s qualifications for the $7,500 consumer EV credit and the magnitude of the battery production credit.
The analysts wrote in a note “We continue to view Tesla as one of most attractive stories in the autos sector thanks to its pricing power, superior cost structure, strong execution, and having secured supply and now establishing more meaningful capacity to support considerable growth."