Happy Saturday friends,
Let’s review the elephant in the room.
Tesla reported earnings on Wednesday after the close. The stock gapped down -4.5% following the numbers, ripped 29 points Thursday, ticked 450, then tumbled to finish the week. Are you having fun yet? lol.
Zoom out to the weekly chart. Wall Street is watching, waiting for a resolution.
Looking at the daily chart, $TSLA remains range-bound. [ 410 | 450 ]
The Narrative & Numbers
Tesla didn’t shock and awe with its numbers. But I want to review a few…
Revenue grew 12% YoY. Growth is good.
Free cash flow reached a record high of $4B. And Cash and Investments increased to $41.6B.
Tesla’s energy storage segment was a standout. It surged 44% as the AI electrification trend accelerates. In 2026, Megapack 3 production will commence in Houston to create up to 50 GWh per year of manufacturing capacity.
These figures indicate that the underlying business is strong and capable to fund new products.
Remember folks - Tesla is not just a car company. The stock moves on news of its Robotaxi operations and Optimus humanoid robot progress. These are the narratives (memes) at play. And as Steven Place kindly pointed out in New Orleans, Tesla doesn’t even display its cars on the investors relations webpage… 🤖
Regarding the narratives - Yes, Elon is known to exaggerate.
However, he expects Robotaxi operations to expand to 8-10 metro areas and operate without safety drivers by year-end. He also said that Optimus, Tesla’s humanoid robot, “has the potential to be the biggest product of all-time.”
Bold claims. Good luck champ. We wish you the best of luck!
The Trade
We’ve been patient with this trade all year. Earnings are behind us, and I suspect we’ll see a surge to all-time highs in the not so distant future. Maybe Monday. Maybe next month. Maybe never… Who knows.
But if $TSLA is above $410, the path of least resistance is higher. Allocate accordingly.
Disclosure: This is not financial advice.
