Tesla (TSLA) Outpaces Stock Market Gains: What You Should Know

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Tesla (TSLA) closed the most recent trading day at $271.30, moving +1.43% from the previous trading session. This change outpaced the S&P 500’s 0.12% gain on the day. Meanwhile, the Dow lost 0.2%, and the Nasdaq, a tech-heavy index, added 0.29%.

Coming into today, shares of the electric car maker had gained 14.82% in the past month. In that same time, the Auto-Tires-Trucks sector gained 5.09%, while the S&P 500 gained 0.09%.

Tesla will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $0.78, down 25.71% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $25.09 billion, up 16.93% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $3.46 per share and revenue of $100.12 billion. These totals would mark changes of -14.99% and +22.9%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for Tesla. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company’s business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.53% lower within the past month. Tesla currently has a Zacks Rank of #3 (Hold).

Digging into valuation, Tesla currently has a Forward P/E ratio of 77.31. This valuation marks a premium compared to its industry’s average Forward P/E of 10.14.

Also, we should mention that TSLA has a PEG ratio of 3.54. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company’s expected earnings growth rate into account. The Automotive – Domestic was holding an average PEG ratio of 1.23 at yesterday’s closing price.

The Automotive – Domestic industry is part of the Auto-Tires-Trucks sector. This group has a Zacks Industry Rank of 90, putting it in the top 36% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow TSLA in the coming trading sessions, be sure to utilize Zacks.com.

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Tesla, Inc. (TSLA) : Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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