Citi reiterated a Neutral rating on Tesla (NASDAQ:TSLA) and cut their 12-month price target on the electric automaker’s stock to $255.00 (From $271) following the company’s 3Q earnings miss.
The company reported 3Q EPS of $0.66, missing the Street’s $0.72 estimate by $0.06. Revenues came in relatively even with consensus estimates at $23.4B for the quarter. However, the auto gross margin came in at 16.3% as credits were higher than modeled.
“The tone on the call was noticeably more cautious on a few fronts including macro, the Cybertruck ramp and Mexico expansion.” Writes analysts at Citi in a note.
The current sentiment surrounding the EV market could be described as pessimistic, primarily due to the view that Tesla's price reductions have not significantly stimulated demand. Furthermore, this strategy has made it more difficult for competitors to successfully ramp EVs.
Analysts at Citi suspect Tesla’s 3Q results will worsen this sentiment.
Citi cut EPS estimates to reflect the Q3 miss and outlook. Their 2024 EPS estimate, which was already below consensus, goes to $3.94.
Shares of TSLA are down 6% in pre-market trading Thursday morning.