Tesla (TSLA) Outpaces Stock Market Gains: What You Should Know

In the latest trading session, Tesla (TSLA) closed at $202.07, marking a +0.6% move from the previous day. This change outpaced the S&P 500’s 0.53% gain on the day. Meanwhile, the Dow gained 0.33%, and the Nasdaq, a tech-heavy index, lost 5.2%.

Heading into today, shares of the electric car maker had gained 39.07% over the past month, outpacing the Auto-Tires-Trucks sector’s gain of 19.83% and the S&P 500’s gain of 0.67% in that time.

Wall Street will be looking for positivity from Tesla as it approaches its next earnings report date. On that day, Tesla is projected to report earnings of $0.86 per share, which would represent a year-over-year decline of 19.63%. Our most recent consensus estimate is calling for quarterly revenue of $23.61 billion, up 25.87% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $3.96 per share and revenue of $101.59 billion, which would represent changes of -2.7% and +24.71%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for Tesla. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company’s business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 12.74% lower. Tesla is currently a Zacks Rank #3 (Hold).

Valuation is also important, so investors should note that Tesla has a Forward P/E ratio of 50.74 right now. For comparison, its industry has an average Forward P/E of 11.97, which means Tesla is trading at a premium to the group.

We can also see that TSLA currently has a PEG ratio of 2.1. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company’s expected earnings growth rate. TSLA’s industry had an average PEG ratio of 1.52 as of yesterday’s close.

The Automotive – Domestic industry is part of the Auto-Tires-Trucks sector. This group has a Zacks Industry Rank of 63, putting it in the top 25% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Tesla, Inc. (TSLA) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research