Tesla, Inc. (NASDAQ:TSLA) reported second-quarter results well below Wall Street expectations

Tesla, Inc. (NASDAQ:TSLA) reported second-quarter results well below Wall Street expectations

Tesla, Inc. (NASDAQ:TSLA) reported second-quarter results well below Wall Street expectations

Tesla Inc. shares fell 11% after hours Wednesday after the Silicon Valley car maker reported second-quarter results well below Wall Street expectations, despite coming on the heels of record sales for the company.

Tesla TSLA, +1.81% said it lost $408 million, or $2.31 a share, in the quarter, compared with a loss of $718 million, or $4.22 a share, in the year-ago quarter. Sales rose to $6.3 billion, compared with $4 billion a year ago.

Adjusted for one-time items, Tesla lost $1.12 a share, compared with a loss of $3.06 a share a year ago.

Musk brushed off a question about demand and the impact of the diminishing tax credits, saying that demand for its vehicles was already better in the third quarter than the second quarter’s.

By the fourth quarter, demand “will be very strong,” he said, adding he expects Tesla to have a tougher time of it in the first half of 2020 but an “incredible” end of 2020.

Tesla also made a decision regarding its next vehicle, the Model Y: It will be made at the company’s plant in Fremont, Calif., according to the letter and to comments during the call. Tesla had wavered between making the compact SUV in California or at its Nevada gigafactory.

Local production of the Model 3 in China is on track by year-end, it said. Tesla is also “accelerating” its efforts in Europe and hopes to announce a location for a factory there “in the coming quarters.”

“The Model Y and Chinese production will both contribute to profit, but not in the near term, suggesting 2019 will be a tough year for Tesla’s financials,” said Karl Brauer, an analyst with Kelley Blue Book.

Tesla also cut its capital expenditures to between $1.5 billion to $2 billion, from a previous guidance of between $2 billion and $2.5 billion. It called for gross margins around 19% for all of its vehicles despite its recent price cuts; in the previous quarter, it had said the Model 3’s gross margin was around 20%.

Overall, the bias in prices is: Upwards.

Note: this chart shows extraordinary price action to the upside.

By the way, prices are vulnerable to a correction towards 239.24.

The projected upper bound is: 282.95.

The projected lower bound is: 248.32.

The projected closing price is: 265.64.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 7 white candles and 3 black candles for a net of 4 white candles. During the past 50 bars, there have been 27 white candles and 23 black candles for a net of 4 white candles.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 75.0501. This is not an overbought or oversold reading. The last signal was a sell 2 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 74.41. This is where it usually tops. The RSI usually forms tops and bottoms before the underlying security. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 2 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 105.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 2 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 34 period(s) ago.

Rex Takasugi – TD Profile

TESLA INC closed up 4.710 at 264.880. Volume was 5% above average (neutral) and Bollinger Bands were 11% wider than normal.

Open     High      Low     Close     Volume___
259.170 266.070 258.160 264.880 11,072,835

Technical Outlook
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bearish

Moving Averages: 10-period     50-period     200-period
Close: 253.69 221.50 281.85
Volatility: 27 52 62
Volume: 8,038,389 10,673,350 9,505,987

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

TESLA INC is currently 6.0% below its 200-period moving average and is in an upward trend. Volatility is low as compared to the average volatility over the last 10 periods. Our volume indicators reflect moderate flows of volume into TSLA.O (mildly bullish). Our trend forecasting oscillators are currently bullish on TSLA.O and have had this outlook for the last 28 periods. Our momentum oscillator is currently indicating that TSLA.O is currently in an overbought condition.

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