Tesla (NASDAQ:TSLA) is on a wild ride. Even with the current decline of nearly 4%, the stock is still riding high on a 75% surge year-to-date, fueled by all things Trump, autonomous vehicles, and AI. But here’s the kicker: investors are holding their breath as Tesla prepares to report its fourth-quarter deliveries. Analysts are looking for around 510,000 vehicles delivered, just shy of the company’s 515,000 target. If Tesla misses this goal, some analysts say it won’t crush the stock’s momentum, but it’ll certainly test whether the hype behind its tech and leadership can keep pushing this rocket ship.
Here’s the deal: Tesla’s success in China is helping offset weaker sales in the U.S. and Europe. In fact, Tesla’s China division is on fire, reporting its highest weekly sales for Q4 earlier this month. But let’s not sugarcoat everything. Tesla’s stock has been on a tear, and while it’s been exciting to watch, Barclays analysts are raising eyebrows. They’re calling out a sharp disconnect between the stock price and the company’s fundamentals, likening it more to cryptocurrency than an actual automaker. So yeah, the stock is soaring, but it might be running on fumes.
And just to add another layer of complexity, Tesla’s battery supplier, Contemporary Amperex Technology (CATL), is prepping for a secondary listing on the Hong Kong stock exchange. This could shake things up as U.S. automakers, including General Motors (NYSE:GM), are feeling the heat from local Chinese competitors like BYD and Nio. As Tesla continues to dominate in China, the competition is getting fiercer, and CATL’s listing could add a whole new dynamic to the EV market. Buckle up.
This article first appeared on GuruFocus.