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As I write this so far Tesla (TSLA) has not unveiled a new model but they hinted at it. I think the stock's down on that currently.

Tesla Stock Technical Risk

The stock price at 193 as I write this is still in a neutral trading range. It's still in a trading range but risk is building for a drop with lower highs showing in the recent chart.

The stock breaking 192 would clinch short-term follow-through risk.

Also, the stock has been testing but failing a key level higher of 209-210. The longer it's below that key level, the more risk builds to go back to 100 which is the next medium-term key level below. So Tesla needs to hold.

Yes, 100 would be another big drop but we were out ahead of that big drop calling out 'serious technical risk' for Tesla back in October.

Based on the medium-term chart of lower-highs, and lower-lows, there is still that risk.

If the stock market is bullish obviously it's likely Tesla stock can hold and go higher but on its own, I'm not bullish. That means I think it should underperform whatever the market does.

Today's Tesla Analyst Day

I don't hear a lot of new investor news today. Yes, the company is amazing and way ahead of its peers but I've called out a couple of near-term risks for Tesla that have not (thus far) been resolved in this analyst day.

Even though we called out Tesla stock bottoming technically on January 12th ahead of a big move higher, we still called out a few key risks for the company.

Tesla's key risks short and medium term are still 1) a slowdown 2) lower margins and 3) a push out of true-FSD.

Tesla Slowdown

Estimates have been coming down for this quarter's deliveries. Troy Teslike recently brought his estimates down to 422,000 deliveries this quarter which is below the Street. We were at 421,000 in our model for this quarter. A slowdown is obviously a negative but it's not just solely based on the economy and higher rates. Tesla has talked about being at max delivery capacity and they are trying to fix it. We've been saying that fixing that 'delivery curve' problem should cause push-outs of deliveries for a few quarters until they fix this max-capacity issue. That's a headwind to each quarter's reported deliveries.

Tesla Lower Margins

I've pointed out that our EPS estimates for 2023 are below the Street. When we were lone sell-side bulls for a few years through 2021 our estimates were way above the Street. Now we're below, so I think there's earnings risk, not upside. Lower margins led by lower car prices and maybe soon lower-priced models are a margin and EPS headwind. Stocks trade on earnings, generally so an earnings headwind is another risk for Tesla stock.

True-FSD Pushout

We've called out since two quarters ago that Musk had pulled back on true-FSD timing on that earnings call. The big bulls and their super-high valuations are dependent on Robotaxi volumes accelerating the company's production and margins. But the push out of true-FSD is against that valuation hope. So the more that true-FSD gets pushed out the more Tesla turns into a traditional, yet better, automobile manufacturer. And a typical car company affords a much much lower valuation multiple than big bull forecasts call for Tesla. So tons of Tesla valuation hopes are dependent on true-FSD becoming a reality. So, in the meantime, I think there's valuation leak risk as big bulls get spooked out of their years-out valuation hopes.

Not getting to true FSD changes the longer-term valuation that institutional bulls had in their models. I think that's the big valuation leak risk.

Conclusion

Generally, I don't see a lot of new news that's a benefit for this stock shorter term. Yes, the company is far ahead of vehicle peers but the real question is how quickly true-FSD ramps to get the company and big-bulls much much higher volume and valuation targets longer term. I don't think these risks are going to be answered or resolved today.
 

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