Tesla Q1: Facing A Liquidity Crunch; Dilution Ahead?

Summary:

  • Tesla’s Q1 earnings report resulted in a 12% jump in stock, indicating investor optimism about the company’s transition to robotics/AI.
  • However, this article highlights concern about Tesla’s struggling auto division, which could lead to financial strain in the coming year.
  • I’m still optimistic about the possibilities of AI, but further cash burn could end up hurting investors.

Piggy bank in pieces

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Thesis Summary

Tesla, Inc. (NASDAQ:TSLA) has just reported its Q1 earnings, and the stock quickly jumped over 12%.

Tesla has been selling off over the last year due to weak demand, price cuts, and an overall lack of positive sentiment. The

Net Cash (mil)

Net Cash/

Equity

Net Working Capital (mil)

NWC/Equity

FCF/Equity

S&P Debt rating

Moody’s Debt Rating

Daimler-

Benz

$31,659

48%

$25,335

35%

21%

A

A2

VW Group

$38,442

26%

$47,693

30%

14%

BBB+

A3

Honda

$28,700

33%

$15,387

22%

13%

A-

A3

BMW

$17,003

22%

$13,829

16%

11%

A

A2

Toyota

$65,000

27%

$22,190

9%

10%

A+

A1

GM

$3,445

7%

$725

1%

19%

BBB

Baa2

Tesla

$23,864

41%

-$26

0%

7%

BBB

Baa3

Stellantis

$29,487

36%

-$5,705

-6%

16%

BBB+

Baa2

Ford

$8,780

21%

-$3,670

-42%

17%

BBB-

Ba1


Analyst’s Disclosure: I/we have a beneficial long position in the shares of TSLA either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha’s Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.


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