Shares of Tesla (NASDAQ: TSLA) have fallen nearly 30% from a December high, ending the week at $354, which is about 9% below the month's high of $388. The company is currently trading in a bear market.
Upcoming financial results are expected to provide insight into the company's growth and cash flows. Tesla delivered 486,532 vehicles in the third quarter, which was slightly fewer than the number delivered during the same period last year. Analysts expect revenue to be largely flat year-on-year at approximately $28.1 billion, with the most optimistic estimate at $30.5 billion. Earnings per share are projected to be 45 cents, lower than the $0.50 reported in the previous year.
The company reported a negative free cash flow of $1.1 billion in the second quarter, with capital expenditures reaching $5.8 billion. Management expects to spend $25 billion to fund AI infrastructure, data centers, Optimus, and the Cybercab.
Options market activity suggests a potential rebound following the earnings report. Options expiring this week carry an implied volatility of 42%, higher than the historical average of 33%. The put/call volume ratio stands at 0.53, and open interest is at 49. A significant portion of call options is positioned at the $370 strike price, implying a potential 4.5% jump from the current level. Calls are also positioned at the $350 strike.
Wall Street analysts have set a range of price targets for the company. Jefferies raised its target to $400 from $350. Tigress Financial has a target of $550, while UBS Group estimates a rise to $391. JPMorgan has set a target of $415, and the average estimate is $412.
