Investing.com-Tesla (NASDAQ 🙂 is scheduled to report its fourth-quarter financial results on Jan. 29 after the market closes at the bell.
Morgan Stanley (NYSE 🙂 Analysts believe expectations are on the side of quarterly gross auto margin, excluding regulatory credits, in the 15% range. They also expect Tesla’s free cash flow (FCF) to benefit from inventory cuts in the fourth quarter.
“More attention will be paid to outlook commentary, including a repeat (or not) of the 20-30% FY24 growth target, model y ‘juniper’ ramps, FSD rate of change, AI infrastructure expansion, cybercab deployment targets, Optimus Milestones and a potential deep diving ‘AI day,’ analysts led by Adam Jonas said in a note on Friday.
Tesla’s potential challenges include opposition to electric vehicle (EV) incentives, which could affect volume growth expectations for fiscal 2025. Morgan Stanley notes that expectations for purchases are now closer to a 10% growth rate rather than 20%, citing increased competition in China, slowing CyberTruck volumes and the possibility of the removal of EV tax incentives.
As a result, the company has lowered its forecast for Battery Electric Vehicle (BEV) market penetration in fiscal year 2025 to 8.5% from 9% previously.
The bank also addressed growing interest in humanoid robots, acknowledging an influx of client inquiries after NVIDIA (NASDAQ:) CEO Jensen Huang at the Consumer Electronics Show earlier this month.
While Morgan Stanley considers Tesla an ’embodied AI ETF’ due to its strategic positioning in AI robotics, it currently assigns no value to Tesla for Embodied AI in its $430 target or $800 range.
In the note, analysts also emphasized the importance of data collection across various form factors, including Tesla’s vehicle fleet and AI infrastructure. They believe that as Tesla expands its data collection capabilities, the narrative surrounding the company and the type of investors interested in the stock will evolve significantly.
Finally, the company touched on the potential impact of Trump administration policies on the EV industry, comparing it to the historic Monroe Doctrine. The use of tariffs and other measures could accelerate the deployment of AI technology and create a more secure supply chain.
“Just as the Monroe Doctrine was US policy in opposition to European colonization in the W. Hemisphere, we expect to see the Trump administration’s EV and AV policies encourage new domestic supply of critical technologies and the accompanying manufacturing and supply base,” the analysts said.
“Tesla’s role in helping” fill the “next-gen manufacturing and supply chain gap will be an increasingly consequential driver of growth and shareholder value, in our view,” they concluded.
