TLDR
- Tesla delivers record 497,099 vehicles in Q3 2025, beating Wall Street estimates as buyers rushed for the expiring $7,500 federal EV tax credit
- Options traders show bullish stance with put/call ratio of 0.56, indicating nearly twice as many call purchases as puts ahead of October 22 earnings
- New Model 3 Standard at $36,990 and Model Y Standard at $39,990 disappointed investors, causing 4.5% stock drop on modest pricing cuts
- Wall Street divided with Hold rating, 16 Buys and 9 Sells, average $364 price target implies 16% downside from current $429 level
- Analysts expect $0.54 earnings per share for Q3, down from $0.72 last year, with focus on profit margins after price cuts
Tesla stock is drawing heavy options activity ahead of its October 22 earnings report. The electric vehicle maker closed around $429 on Thursday after touching $453 earlier this month.
Options data reveals bullish sentiment among traders. The put/call ratio stands at 0.56, meaning call volume is nearly double that of puts.
Calls are bets the stock rises. Puts bet it falls.
The options market prices in a 50% chance Tesla moves more than 6.8% after earnings. That’s a wide swing for a $1.4 trillion company.
Wall Street expects earnings of $0.54 per share. That’s down from $0.72 in the year-ago quarter.
Record Deliveries Beat Forecasts
Tesla reported 497,099 vehicle deliveries in Q3. The quarterly record beat Wall Street’s 443,000 estimate by over 50,000 units.
Deliveries jumped 7.4% year-over-year. The surge came as buyers rushed to claim the $7,500 federal EV tax credit before it expired in September.
Tesla offered aggressive discounts and financing to drive sales. The strategy worked for Q3 numbers.
But analysts warn about Q4 demand. Ken Mahoney of Mahoney Asset Management said the credit expiration “could leave a U.S. demand gap in the fourth quarter.”
Tesla’s energy division set a Q3 record deploying 12.5 GWh of storage. That helps diversify beyond cars.
The key question for earnings is margins. Tesla slashed prices to hit delivery targets. Auto gross margins were already in the mid-single digits.
Investors want to see if volume came at profit’s expense.
New Entry Models Get Cool Response
Tesla launched Model 3 Standard at $36,990 and Model Y Standard at $39,990 on October 7. The new trims cut $4,000 to $5,000 from previous base models.
They include fewer features like no Autosteer and reduced speakers. The cuts fell short of expectations.
Wedbush analyst Dan Ives called the pricing “disappointed.” Tesla stock dropped 4.5% on October 8 when details emerged.
The company still lacks a true mass-market car under $30,000. These models just pull a pricing lever without breakthrough innovation.
Competition intensifies globally. Tesla’s European market share fell to 1.5% as August sales dropped 22.5% year-over-year.
Chinese rivals like BYD expand aggressively. Legacy automakers launch new EV models quarterly.
Global EV sales hit 2.1 million units in September, up 26% from last year. Tesla fights harder for each sale in the growing market.
Analyst Views Split on Valuation
Morgan Stanley’s Adam Jonas maintained his Buy rating this week. He sees Tesla well-positioned in sustainable transportation but warned the company’s physical AI lead is shrinking.
All major tech companies now invest heavily in robotics. That reduces Tesla’s ten-year robotaxi advantage.
Wall Street consensus is Hold. The stock has 16 Buy ratings, 13 Holds and 9 Sells.
The average price target of $364 suggests 16% downside from current levels. Bulls like Dan Ives see $600 potential in 12 months.
Morgan Stanley targets $410. Piper Sandler raised its target to $500.
Bears argue the valuation is excessive at 250 times forward earnings. HSBC Research has a $127 price target with a Reduce rating.
An NHTSA investigation into Full Self-Driving software covering 2.9 million vehicles adds regulatory risk. The probe announcement dropped shares 2% on October 9.
Tesla gained 1.38% on Thursday as options traders positioned for Wednesday’s earnings through heavy call buying.
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