stock rose past $200 for the first time in almost three months, part of a series of gains that are raising the stakes for the shares ahead of the EV maker’s second-quarter delivery report.
Tesla stock hadn’t traded above $200 since March 1. “Getting through [$200 can] be psychologically significant,” says Frank Cappelleri, a technical analyst and founder of the research shop CappThesis. Investors tend to like it when stocks reach round numbers.
Shares of the EV company are on one of their impressive runs. Through midday trading Friday, Tesla stock was up almost 20% from its June lows, reached just before Tesla announced that shareholders reapproved the 2018 compensation package that awarded CEO Elon Musk some 300 million incentive-laden stock options.
The pay-package vote removed a concern that had been weighing on Tesla stock, catalyzing the recent run. But the gains raise the likelihood of increased stock volatility after the company reports its second-quarter delivery results on Tuesday.
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Current Wall Street estimates are for deliveries of about 420,000 vehicles, down from 466,000 cars in the second quarter of 2023. Beating 420,000 should be a win for the stock, while a lower number could mean weakness.
Options markets imply shares will move 5%, up or down, following Tesla’s delivery report. Shares have moved an average of about 3%, up or down, following the past four reports. They dropped almost 5% after Tesla reported weaker-than-expected first-quarter deliveries.
Fairlead Strategies technical market analyst Will Tamplin points out that Tesla stock faces some resistance near its 200-day moving average around $207 a share and that a move past that level means shares could run to $220 to $225. A good delivery result would help propel shares toward that $220 to $225 zone.
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On the other hand, a weak result should send shares back down toward $170, he said. Tamplin isn’t making a fundamental call on deliveries. His analysis is based on where shares have run into resistance, or had support, in the past.
The second-quarter earnings report comes a few weeks after the deliveries news. It has even more potential to move the stock. Tesla shares have moved an average of 11%, up or down, following the past four quarterly reports.
Through midday trading Friday, shares were down about 19% year to date. Slowing sales growth, uncertainty over Musk’s pay, and falling earnings estimates have weighed on investor sentiment in 2024.
Write to Al Root at allen.root@dowjones.com
