Tesla released its Q3 results. In pre-trading, the stock dropped 1%. The results were record-breaking in many respects and above market expectations. The negative post-publication performance is likely to be attributed to management’s statements that the shortage of semiconductors and congested ports could lead to a slowdown in car production. Tesla closed the quarter with revenues at $13.7 billion, up 57% y-o-y and in line with market estimates. Adjusted EBITDA stands at €3.2 billion, up 77% y-o-y and above expectations of 8.8%. Profit amounted to $1.6 billion (+ 389% y/y) and well above the firm expectations of $1.35 billion (+ 19% q-o-q).
TESLA [TSLA.O], closed yesterday at $865 (+0.2%). In pre-trading today, it dropped 0.8% to $858.5. After hitting all-time highs at $900 last January, prices first retraced and then started a side phase, alternating minor uptrends/downtrends, in the $540/$550 – $720/$780 band. Since August, Tesla – about which we have recommended “Buy” on several occasions – has shown a strong recovery in strength and has now broken the $800 area. Next target will be the historical highs.
We recommend going LONG on the stock by buying the Leverage Shares Tesla 3x ETP (ISIN: XS2297549128), the 2X ETP (ISIN: IE00BK5BZY66) or the 1x Tracker (ISIN: XS2337093798), with an increase in exposure on any downturns towards $800, with short-term target towards $900. Alert/stop loss should be below $800 (closing daily).