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Reasons to Buy Tesla Stock in 2022

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Elon Musk is Tesla’s Chief Executive Officer. There’s never a dull moment. Elon Musk is launching astronauts into space on one day. Another day, he opens a new auto manufacturing facility to a large crowd in Berlin. After becoming Twitter’s largest shareholder, he is now jousting on Twitter. What makes Tesla stock a good investment?
Tesla (TSLA), which reported that it shipped 310.048 vehicles in its first quarter, an increase of 68% over the previous year and below analyst estimates at 312,000.

Analysts were anticipating a drop in sales as Covid shuts down in China recently. This was after Tesla’s Shanghai plant had been closed. Dan Ives, Wedbush analyst, said that the closure of Tesla’s Shanghai electric vehicle plant had created massive logistics problems in order to deliver units to European customers.

Ives wrote that “relative to other automobilemakers such as GM(GM) or Ford Motors (F), as well as Chinese EV player such as Nio, Xpeng and others, these delivery and production figures are a positive move in the right direction to take hold of the next step in the Tesla growth tale to take place with Berlin and Austin factories now effected.”
Covid Closes Shanghai Plant

Tesla reported better-than expected earnings for its first quarter on July 21. This was due to the slow reopening of its Shanghai factory that was closed after a spike in Covid-19-related cases in China.

In its earnings presentation, management stated that although weekly production rates in Q1 were high, a spike in Shanghai COVID-19 cases caused temporary shutdowns of our factory and parts our supply chain. “We continue to monitor the situation closely, even though limited production has resumed in recent weeks.”

Musk is positive that production will rebound. Musk told investors during an earnings call that second-quarter production was likely to be comparable to first quarter. Or maybe slightly lower.

He added, “We might even be able to pull out a rabbit from the hat”

Did you know? You can see the Tesla stock forecast here…

First-Quarter Earnings Soar

Tesla’s earnings per share rose 246% to $3.22/share in its first quarter. Its sales increased 81% to $18.76billion. Both have experienced a second quarter of rapid growth. The $679 million in regulatory credits is nearly double what it was in the fourth quarter 2021. Twitter stock surged.

Tesla’s factory opened in Berlin on March 22nd and is now shipping its Model Y. Its Austin plant was opened on April 7. The Model Y will also be manufactured at this Austin location.

However, it will continue to be difficult to achieve delivery targets due to the conflict in Ukraine and persistent parts shortages.

Musk stated on Twitter that it was an “exceptionally” difficult quarter because of supply chain interruptions and China’s zero COVID policy.

The auto giant indicated that it plans to sell 1.5 million new electric cars in 2022. This number could rise to 2 million if supplies are better. It would almost triple last year’s total.
Twitter Acquisition by Elon Musk

As if this weren’t enough, Musk in April announced that he bought a 9.2% stake (TWTR) in Twitter, making him the company’s largest shareholder.

Musk offered to acquire Twitter for $54.20 per unit in cash, after which he made a formal offer on April 14th. Twitter agreed to be bought by Musk 11 days later for $54.20 per Share in a cash transaction worth $44 billion.

Musk stated in writing that free speech is the cornerstone of a functioning democracy and that Twitter is the digital square where important issues are being discussed.

“I also want Twitter better than ever” he stated.

Musk plans to eventually produce 20 million electric vehicles per year for the next 10 years. This would be more than twice what is currently produced by other auto-making giants. The company is on a mission now to quickly expand its manufacturing capabilities.

Tesla now makes cars in Germany and will be competing in electric vehicles with three German companies: Volkswagen Group, BMW (BMWYY), Mercedes-Benz division of Daimler AG.

Rivian, General Motors, Ford Motors and Rivian (RIVN) are all serious rivals. This spring, Ford’s F-150 Lightning Electric truck is anticipated. The second quarter of 2023 will see the debut of the first GM electric Silverado. This truck is targeted at fleet operators.
Tesla Stock – Check Out Our Review

According to the IBD StockCheckup tool, Tesla stock has a IBD Composite Rating 95 out of 99. Concentrate on stocks that have a Composite rating of 90 or more when choosing growth stocks to maximize potential gains. This is based upon the CAN SLIM investment paradigm.

Relative strength ratings for the stock are 87 out 100. The rating signifies that Tesla stock has outperformed 87% other stocks in the IBD Database over the past twelve months.

Its Accumulation/Distribution Rating is C. That rating analyzes price and volume changes in a stock over the past 13 weeks of trading. A grade of “A” indicates institutional buying. E stands for heavy selling. Consider the C grade neutral.

Timing is key in the stock market. It is crucial to analyze the fundamentals and technical aspects of stocks before you decide to buy or to sell them.
Tesla Stock: Is it a Buy?

MarketSmith analysis of a daily Chart shows that Tesla stock has formed an “cup-with-handle” base, with a buy-point of 1,152.97. Following a rally of 32% in March, shares took a rest from the market sell-off. It ended regular trading sessions on April 11, at 975.93.