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Tesla (TSLA) Exceeds Market Returns: Some Facts to Consider

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Tesla (TSLA - Free Report) ended the recent trading session at $261.47, demonstrating a +1.89% swing from the preceding day's closing price. The stock exceeded the S&P 500, which registered a gain of 0.14% for the day. Meanwhile, the Dow experienced a rise of 0.3%, and the technology-dominated Nasdaq saw an increase of 0.16%.

Prior to today's trading, shares of the electric car maker had gained 4.01% over the past month. This has lagged the Auto-Tires-Trucks sector's gain of 5.89% and the S&P 500's gain of 4.89% in that time.

Analysts and investors alike will be keeping a close eye on the performance of Tesla in its upcoming earnings disclosure. In that report, analysts expect Tesla to post earnings of $0.73 per share. This would mark a year-over-year decline of 38.66%. Alongside, our most recent consensus estimate is anticipating revenue of $25.78 billion, indicating a 6% upward movement from the same quarter last year.

For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $3.16 per share and a revenue of $97.52 billion, representing changes of -22.36% and +19.71%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for Tesla. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the company's business health and profitability.

Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. The Zacks Consensus EPS estimate has moved 0.21% lower within the past month. Tesla is holding a Zacks Rank of #4 (Sell) right now.

Digging into valuation, Tesla currently has a Forward P/E ratio of 81.14. This denotes a premium relative to the industry's average Forward P/E of 10.32.

It is also worth noting that TSLA currently has a PEG ratio of 4.26. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Automotive - Domestic stocks are, on average, holding a PEG ratio of 1.5 based on yesterday's closing prices.

The Automotive - Domestic industry is part of the Auto-Tires-Trucks sector. This group has a Zacks Industry Rank of 176, putting it in the bottom 31% of all 250+ industries.

The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Ensure to harness Zacks.com to stay updated with all these stock-shifting metrics, among others, in the next trading sessions.


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