Newly manufactured Tesla cars
ADRIAN DENNIS/AFP/Getty Images
Tesla released fourth-quarter deliveries on Saturday. It’s an unusual time for a press release, but Tesla doesn’t always play by typical auto company rules. The number, and not the timing, is ultimately what matters to investors, and the delivery number is pretty good.
The electric vehicle pioneer said it delivered 180,570 vehicles in the fourth quarter of 2020—a quarterly record for deliveries and up about 60% compared from the fourth quarter of 2019.
For the full year, Tesla (ticker: TSLA) delivered about 499,000 vehicles. That’s just short of initial management projections of 500,000 vehicles. That isn’t a disappointment though. Initial projections were before Covid-19 impacted the entire auto industry. Tesla 2020 vehicle deliveries grew about 36% compared with the full year 2019, despite pandemic, lock downs and production disruptions.
Wall Street was looking for about 176,000 deliveries for the fourth quarter of 2020, so the reported number represents a beat versus analyst expectations. But estimates had been creeping up into year-end. The highest Street estimates for fourth-quarter deliveries were roughly 185,000 vehicles, while the “whisper number” for Tesla fourth-quarter deliveries was about 181,000.
A “whisper number” reflects the most current investor expectations which aren’t always reflected in analysts’ published numbers.
The delivery number, considering all that, is good enough. The stock should be fine on Monday, though if could dip a little. Investors often sell on news—even good news—and Tesla shares rose almost 7% in the final week of 2020.
The Saturday delivery number is making Wall Street work the weekend. Wedbush analyst Dan Ives called the figure “in line with the bull whisper number,” adding that Tesla hit a high bar for fourth-quarter deliveries.
New Street Research analyst Pierre Ferragu focused on vehicle production, which rose 71% year over year in the fourth quarter. That’s good news for 2021 deliveries, and he believes 870,000 is possible for 2021. Both Ives and Ferragu are relatively bullish, though they each rate the stock at Hold after its impressive 2020 gains.
Looking ahead for the full year 2021, Wall Street analysts on average project deliveries of 797,000, up another 60% compared with 2020. More sales and production in China along with initial Cybertruck sales in the U.S. should propel sales in the new year. Tesla is also building a plant in Germany to help boost European sales. That plant should be producing cars at some point in 2021.
Tesla stock’s 743% gain in 2020 leaves the company worth roughly $670 billion—and almost $780 billion on a fully diluted basis. The company is worth hundreds of billions more than the second most valuable car company in the world— Toyota Motor (TM).
Tesla’s basic share count is about 950 million shares. Tesla’s fully diluted share count is about 1.1 billion shares. The difference between basic shares outstanding and fully diluted shares outstanding is, essentially, an assumption that management stock options are exercised.
The 150 million share gap is mainly due to how CEO Elon Musk is compensated. He takes a salary below what average employees make and chooses to be compensated based on how Tesla stock does. That’s another unusual thing about Tesla.
Write to Al Root at [email protected]
