Tesla Motors (TSLA) Q2 earnings: What chip shortage?!

Early indications are that Tesla has navigated the chip shortages well heading into Monday's highly-anticipated earnings report...

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While other space-obsessed billionaires are blasting off into space, Elon Musk is more focused on earthbound transportation concerns. After the stock of his ballyhooed electronic vehicle company Tesla Motors (TSLA) went on a rollercoaster ride through the first half of the year Wall Street will tune in for an eagerly-anticipated update on the firm’s Q2 results.

When are TSLA earnings?

Monday, July 26th after the closing bell.

What are TSLA’s earnings expectations?

Per FactSet, consensus GAAP expectations are for $0.53 in EPS, with adjusted EPS expected to come in at $0.93 per share. Revenue is expected to come in at $11.47B.

Key themes to watch from TSLA earnings

As with any automobile manufacturer in the current environment, traders will be keen for an update on how Tesla is navigating the global semiconductor chip shortage that has derailed many of its competitors. Early indications are that Tesla has navigated the chip shortages well, with the company reporting earlier this month that it produced 206,421 vehicles in Q2 and delivered 201,250 of those to customers. Nonetheless, the company’s outlook for production moving forward will be a key non-financial metric to monitor.

Separately, analysts will undoubtedly press for information about the Tesla Semi, the company’s commercial electric truck, which has yet to get off the production line. Long-time Tesla executive Jerome Guillen was in charge of the project before leaving to little fanfare last month, so investors fear that the timeline for the vehicle could be further delayed. On a related note, traders should expect new information about the construction of new “Gigafactories” in Austin, Texas (which is anticipated to build the Semi and Cybertruck pickup) and Berlin, Germany.

For more on the history of Tesla Motors and its share price performance, see my colleague Ben Lobel's article on the company's fascinating history.

TSLA stock technical analysis

Turning our attention to the chart, TSLA has underperformed the broader indices and other major automobile manufacturers since peaking near $900 in late January. The stock has spend the last six months consolidating in a $200 sideways range between $560 and $760, and with prices right in the middle of that range ahead of earnings, those support and resistance levels are likely to contain price regardless of the post-earnings move.

Taking a step back, the stock’s 200-day exponential moving average has finally “caught up” with price, providing some support around $600 and keeping the longer-term uptrend intact. That said, a disappointing earnings report could prompt the stock to test that support level and/or the $560 area in time. Meanwhile, a strong earnings report could open the door for a run toward the 6-month highs near $760 as we head through August:

Source: StoneX, TradingView

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