After a rough patch in which Tesla’s (TSLA +7.57%) European sales cratered, there are signs the tide may now be turning. With Tesla’s earnings report expected next week, investors interested in the stock should keep an eye on whether the report and the accompanying earnings conference call discuss a European-led rebound and the potential for a new, lower-cost mass-market SUV.
Today’s Change
(7.57%) $27.58
Current Price
$391.78
Key Data Points
Market Cap
$1.5T
Day’s Range
$362.50 – $394.66
52wk Range
$222.79 – $498.83
Volume
21K
Avg Vol
63M
Gross Margin
18.03%
In Germany and France in particular, registration data suggests a bullish recovery for the electric vehicle (EV) maker. In March, German registrations of Teslas were the highest since late 2022. German registrations were up 160% year over year. In the U.K., Tesla registrations rose by 20% at the same time. Meanwhile, in France, March registrations grew an astounding 203% year over year. Granted, these figures are in comparison to a time period last year when CEO Elon Musk was facing a lot of backlash for his comments and actions both in the U.S. and abroad.
The Tesla brand’s rebound is driven by EV adoption in European markets and by the reputational rebuilding of Musk.
Image source: Getty Images.
The second bullish reason to buy Tesla concerns its future EV plans. Tesla’s current SUV lineup is luxury by all accounts. The price tag leaves most global consumers behind. Recent reports suggest Tesla is exploring the development of a new, affordably priced SUV, one that would cost less than the Model Y. This could open the door to the mass market for Tesla and create significant new demand. The company has yet to confirm the creation of a lower-priced SUV, though.
As rivals like China-based BYD eat up market share in Europe and beyond, a budget-friendly Tesla option could be the catalyst the stock needs. As of April 14, Tesla’s stock is down 19% year to date. For buy-and-hold investors, Tesla is a compelling company right now due to its commitment to staying competitive abroad and maintaining market share.
Catie Hogan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Tesla. The Motley Fool recommends BYD Company. The Motley Fool has a disclosure policy.