Analysts Gordon Johnson and Jim Chanos have expressed concerns over Tesla’s performance and market position, citing significant challenges in the electric vehicle manufacturer’s financial metrics.
What’s Happening
Gordon Johnson of GLJ Research has launched a critique of Tesla, highlighting the company’s deteriorating financial metrics. According to Johnson, Tesla’s margins are imploding due to frequent discounts and a collapsing brand and market share across global markets, including China, the United States, Europe, Canada, and Australia.
Key Points
- Johnson notes that Tesla trades at 127x 2025 estimated adjusted earnings per share, compared to the average of 32x for the Magnificent Seven tech stocks.
- He emphasizes that Tesla is not a true tech stock, with approximately 90% of its revenue derived from automobile sales.
- Short seller Jim Chanos has amplified concerns by highlighting a 35% year-to-date sales drop in San Diego County, which he characterizes as “material”.
Sales Trends
The sales drop in San Diego County significantly diverges from S&P Mobility’s estimate of an 11% sales decline. This discrepancy has raised concerns about Tesla’s market performance and strategic direction.
Market Performance
The ongoing debate between Johnson and Fox Business Senior Correspondent Charles Gasparino has further spotlighted Tesla’s challenges. Since 2022, Tesla’s stock has declined 30.4% while the S&P 500 has increased 20.2% during the same period.
Upcoming Report
Tesla’s upcoming first quarter of 2025 delivery report is anticipated to provide further insight into the company’s current market performance, with investors closely monitoring potential indicators of the company’s strategic direction and financial health.
Current Price
Tesla’s stock closed at $278.39, up 11.93% for the day. In after-hours trading, the stock rose an additional 1.43%.
Why It Matters
The concerns raised by Johnson and Chanos have significant implications for Tesla’s future performance and market position. As the company navigates the challenges of the electric vehicle market, it must address its shrinking margins and declining sales trends to remain competitive.