Tesla's (TSLA) Musk May No Longer be Doing Earnings Calls, Which May Be a 'Good Thing' - Jonas

July 28, 2021 1:56 PM EDT
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Tesla (NASDAQ: TSLA) reported a very strong 2Q earlier this week, with EBITDA exceeding that of General Motors (NYSE: GM) and Ford (NYSE: F) combined Morgan Stanley analyst Adam Jonas highlights. Tesla CEO, Elon Musk felt strongly enough about the earnings report that he announced that he will be stepping back from participating in future quarterly earnings calls.

"I will no longer default to doing earnings call," Musk said, according to Bloomberg. "Obviously I’ll do the annual shareholder meeting, but I think that going forward I will most likely not be on earnings calls unless there’s something really important that I need to say."

Morgan Stanley analyst, Adam Jonas, thinks "this is good for Elon and good for Tesla."

"If having a $700bn market cap, $20bn of cash on the balance sheet and printing an industry leading 21% Adj. EBITDA margin wasn’t enough of an indicator that Tesla has built the ‘ballast’ to match its industrial ambition… then having its CEO formally announce that he will leave the quarterly analyst calls to other members of his team should reconfirm this message," Jonas commented.

Tesla’s earnings weren’t the only good news in the EV world. Based on data from EV-volumes, global BEV sales reached 415,688 in June. This figure is up 142% YoY. And as global EV penetration approaches the mid 6% range, Morgan Stanley decided to adjust its penetration forecasts to 13.2% by FY25 and 32.7% by FY30.

Following the 2Q report, Jonas made some adjustments to their Tesla model. For FY21, Jonas now expects 835k total units (from 832k units prior), with sequential growth from Q2's 201k units, growing to 212k units in Q3-21 and 236k units in Q4-21. Morgan Stanley also expects Cybertruck volumes to start in 2022 and ramp from 15k units in 2022 to 283k by 2030.

Morgan Stanley’s new adjusted EPS forecast for TSLA in 2021 is $5.24 (from $4.27), growing to $6.85 in 2022 (from $6.19) and $16.61 in 2025 (from $15.64).

The analyst maintained an Overweight rating and $900 price target on Tesla.

By Michael Elkins | Michael.Elkins@streetinsider.com

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