Deutsche Bank Bullish Ahead of Tesla’s (TSLA) AI Day and 3Q Report

September 30, 2022 7:07 AM EDT
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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 t 367k units, reflecting strong recovery from Q2’s prolonged Covid-related shutdown and logistical challenges in the Shanghai factory as well as 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 $1.06.

This update also comes ahead of Tesla’s AI Day on Friday. Analyst, Emmanuel Rosner believes 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, Rosner expects 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, Musk had commented 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.

Rosner 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. “

By Michael Elkins | [email protected]

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