Goldman Sachs Previews Tesla's (TSLA) 2Q, Raises Estimates

Tesla (NASDAQ: TSLA) announced that it will report its financial results for the second quarter after the market closes on July 26th. Ahead of the print, Goldman Sachs analyst, Mark Delaney, previewed the company’s 2Q, raising EPS estimates for Q2, 2021-2023.

Delaney expects Tesla’s 2Q results to be in-line with new estimates, despite several headwinds. Chip shortages, high freight costs and rising input prices all plagued the company in 2Q. However, higher vehicle pricing in 2021 and higher units in 2022/2023 drove Goldman Sachs to raise estimates and remain bullish.

Goldman Sachs now expects Tesla to report 2Q21 non-GAAP EPS of $0.94 (from $0.84 prior) versus the consensus of $0.96. Delanew expects the price increases and Model Y ramp to have a larger impact on 3Q21 and 4Q21 results.

Goldman Sachs’ new 2021 non-GAAP EPS estimate of $5.00 is above the FactSet consensus at $4.28 and Bloomberg consensus of $4.43.

A new 2022 non-GAAP EPS estimate of $6.50 from the firm compares to the Street at $6.43 (FactSet) and $6.45 (Bloomberg).

In the 2Q EPS preview, Mark Delaney said that “Overall, Tesla has produced 387K vehicles in 1H21 and delivered 386K vehicles globally per company data, which shows in our view that Tesla has sold essentially every vehicle that it has made, and illustrating in our opinion that the company is supply not demand constrained.”

In China, the analyst said Tesla app download data suggests overall demand remains solid in China and is up meaningfully year-over-year.

The analyst maintained a Buy rating and $860 price target on Tesla, suggesting 25.4% upside to Monday's closing price.

By Michael Elkins | [email protected]

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