Fundamental analysis
Income statement
- Total revenue: looks good, increasing year over year.
- Gross profit: follows the total revenue
- Operating expenses: continuely growing which means the business is striving but doesn’t affect the profits, as the operating income is steadily growing
- Operating income: The business is generating money, 2022 was great for TSLA so it makes sense to see 2023 with lower values, however 2024 seems to be strong and will probably beat 2023 by EOY.
- Net income: increasing year over year
- EBITDA (performance) : strong growth followed by a peak and a decline, which is similar to what we see in the revenue side.
Balance sheet
Reference: https://finance.yahoo.com/quote/TSLA/balance-sheet/
- Total assets: looks good, growing year over year
- Total liabilities: looks good, especially comparing 2023 with 2020 (assets vs liabilities values)
- Stockholder Equity: most important one – looks good, positive, growing year over year (assets – liabilities, >2 which is really really good, meaning that company can liquidate assets and pay liabilities and still be ok, therefore not so risky)
Cash flow statement
- Operating cash flow: Positive and growing
- Stock based compensation: Rewarding stock is fine since net income is positive
- Capital expenditures (CapEx): Neutral – this is increasing year over year, meaning that TSLA is spending money on assets (infrastructure, buildings, software etc) for increasing production capacity, developing new technologies, etc.
- Free cash flow (FCF): (Operating cash flow – CapEx): Neutral, free cash flow has been decreasing in the last 2 years, probably due to the capital expenses being increased during those years
- Operating Cash flow is much higher than Financing cash flow, therefore the company is profitable and don’t rely on other people’s money to stay in business.
Personal comment: Fundamentals are looking really good for TSLA right now, it’s a strong company and will continue to grow.
Technical analysis
Monthly timeframe
TSLA is currently in a correction or finished it’s correction, based on how will the market react in the upcoming months.
We have an impulse that ended with a bearish divergence on the RSI, and now we’re in an ABC/WXY correction.
We currently broke a trendline but we don’t have yet any confirmation that the trend has changed, we have higher lows but we need also to close above old high.
On top of that, the correction can continue and the wave count to change accordingly – therefore I’ll sell 10% of my investment in TSLA when it reaches ~340$.
Weekly timeframe
On the weekly, I expect to see some rejection from the current price (250$), although we have liquidity not swept over old highs, therefore we will most likely get there at a later time.
We got a good rejection from 0.786 on fib, sweeping the liquidity over previous low before going higher.
If this is the start of a new impulse wave, we need to break past the 1st wave and the channel it created, so needs to break the resistance at 340$, which has a few confluences.
