Don't Expect Fireworks When Tesla Reports Earnings: Why The Downside Risk Is Limited

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Tesla Inc TSLA is set to report its second-quarter financial results after the bell Wednesday. 

What To Know: Tesla has already confirmed that it delivered fewer vehicles in the second quarter than it did in the prior quarter. Investors will be focused on gross auto margins, production at the company’s gigafactories in Berlin and Texas and production in China following prolonged lockdowns. 

Analysts expect Tesla to earn $1.91 per share on quarterly revenue of $17.39 billion, according to data from Benzinga Pro.

Related Link: Tesla To Release Earnings For One Of Its Toughest Quarters: What Investors Should Expect From Q2 Report

Why It Matters: Analysts are anticipating a challenging quarter for Tesla. If the company reports numbers that are not as bad as feared, Tesla shares could be set up to trade higher.

Virtus Investment Partners’ Joe Terranova doesn’t expect the stock to jump on the report, but said he believes the downside is limited.

“I think the downside is somewhat buffered by a lot of, not only retail interest, but institutional interest,” Terranova said Wednesday on CNBC’s “Fast Money Halftime Report.”

He told CNBC that Tesla is in a sideways consolidation phase. He doesn’t expect much visibility from the report. Even if the report offers a positive upside surprise, the overhang of the Twitter Inc TWTR deal is likely going to weigh on the stock, he said.

“Is there going to be some sort of fallout, some sort of financial impact on the company as a result of what might unfold in that Delaware court room?”

The court on Tuesday ruled in favor of an expedited five-day trial, which is set to take place in October.

See Also: Judge Grants Twitter Expedited Trial Against Elon Musk: What You Need To Know

TSLA Price Action: Tesla has a 52-week high of $1,243.49 and a 52-week low of $620.57.

The stock was up 0.46% at $740 Wednesday afternoon. 

Photo: courtesy of Tesla.

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Image and article originally from www.benzinga.com. Read the original article here.