Canaccord Says 'No Reason to Sell' on Tesla Stock – TipRanks.com

Tesla (NASDAQ: TSLA ) Its shares fell this week after Wall Street reacted negatively to the EV giant's latest delivery numbers. In the third quarter, Tesla delivered 462,890 vehicles, missing the consensus estimate of 463,897 units.

However, while investors voiced their displeasure, Canaccord analyst George Gianaricus has no qualms about the readout.

“Yes, deliveries were a touch lighter than we expected,” Gianarikas said, but emphasized that the real story behind the delivery results was “confirmation that the company is outperforming its fellow Western OEMs in a big way.”

Gianarikas further elaborated that, in recent weeks, reports of supply chain disruptions have been prevalent throughout the auto industry. Tesla, however, seems to have bucked the trend and returned to year-over-year growth.

Tesla's Q3 delivery figure represents a ~4.3% increase over the 443,956 vehicles delivered in the previous quarter and a ~6.4% increase over the 435,059 vehicles delivered during the same period last year.

The improvement was mainly down to a strong showing in China, with Gianaricans wondering if trends in the region indicate what's to come. “There,” says Gianarikas, “EVs and hybrids are crushing the traditional auto market — and most Western OEMs are bleeding.”

In Gianaricus's view, the main problem facing most Western OEMs is that they are not prepared to compete effectively in this segment. The data supports this assumption as sales of ICE vehicles in China have declined significantly, while EVs, especially hybrids, are growing substantially.

Tesla, however, is managing to hold its ground in this highly competitive market because it has a “must-have” EV – something other manufacturers currently lack.

Next up in the Tesla diary is the much-hyped “We, the Robot” event on October 10. Many market observers – Gianaricus included – are skeptical about the near-term availability of robotaxis. As such, going into the event, expectations are rather muted, though Gianarikas thinks there will be enough fireworks to keep investors happy. “Still we expect some 'wow' moments in LA,” he said. “Get ready, showtime next week.”

Meanwhile, Gianaricus issued a buy rating on Tesla shares even though his $254 price target suggests a 6% upside from current levels. (To see Gianaricus' track record, click here)

11 other analysts also think TSLA stock is a buy right now, but they have 16 holds and 7 sells, making the consensus view a hold. Over the next year, the shares are expected to decline 12%, with an average price target currently standing at $210.91. (See Tesla stock forecast)

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Disclaimer: The views expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.