Tesla (TSLA) vehicle insurance registrations in China jumped sequentially last week, giving the company its third-best weekly result in 2024 and pushing registration totals slightly above last year’s total. Meanwhile, one firm resumed coverage of Tesla shares with a buy rating late Monday.
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Tesla insurance registrations in China totaled 16,200 for the week of Sept. 2-8, up 12% from 14,400 the previous week, according to data reported by CnEVPost on Tuesday. With three weeks left in the third quarter, Tesla registrations in China, a rough gauge of deliveries, are up 25% from the previous quarter and up 15% from a year ago.
Tesla’s registrations in China so far this year have turned positive following last week’s results, now up 0.2% compared to the same period in 2023.
Tesla shares rose 1.7% in premarket action on Tuesday, after rising as much as 2.6% on Monday to 216.27.
Bloomberg reported Tuesday that the European Union will adjust its additional tariffs on electric vehicles made in China, bringing the rate on Tesla down to below 8%, compared with a previous downward revision to 9%. That’s on top of an existing 10% tariff. Chinese electric vehicle makers face higher additional tariffs.
Meanwhile, Deutsche Bank analyst Ed Yu resumed coverage on Tesla late Monday night with a buy rating and a price target of 295, 36% above current levels. Yu wrote that the company “does not view Tesla as an automaker, but rather as a technology platform attempting to reshape multiple industries, and that deserves a unique type of valuation framework.”
The analyst added that while there are short-term issues with vehicle delivery growth and margins falling, he said this is temporary.
Tesla China So Far in 2024
Tesla delivered 63,456 vehicles in China and exported 23,241 China-made vehicles to overseas markets in August. The U.S. EV giant’s domestic sales grew more than 37% from July’s 46,227 sales, but are still about 2% lower than the August 2023 total of 64,694.
In the first eight months of 2024, Tesla China sold 587,437 vehicles, down 6% from the same period in 2023. However, in the January-August period, Tesla sold 388,000 vehicles in China, down less than 1% from those eight months in 2023.
Tesla China benefits from continued five-year, interest-free loans to buyers, as well as increased government subsidies for EVs, currently running until the end of September.
Analyst consensus is that Tesla Q3 deliveries will total 458,000 units, up more than 5% from Q3 2023, according to FactSet. That total would be Tesla’s third-best quarterly delivery total ever, behind Q2 2023’s 466,000 and Q4 2023’s record 485,000 deliveries. Analysts predict Tesla will match its record total in the fourth quarter, meaning unit sales will remain flat compared to a year ago.
Tesla Stock Performance
Last week, Tesla shares fell 1.6% to 210.73. On Thursday, shares rose above their 50-day moving average to hit a short-term high of 238.22, buoyed by robust sales in China and the EV giant’s full self-driving rollout plans. That offered an aggressive entry. But TSLA shares fell 8.45% on Friday, back below their 50-day line.
Tesla shares are trying to start on the right side of a potential cup base.
TSLA shares rose 1% in September after falling 7.7% in August. Tesla shares are down about 13% in 2024 after recovering about 60% from a late April low amid some steep ups and downs.
Tesla shares rank No. 3 in the 35-member IBD Auto Manufacturers industry group. The stock has a Composite Rating of 63 out of a best-possible 99. Shares also have a Relative Strength Rating of 69 and an EPS Rating of 57.
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