Automobile Manufacturers Stocks Q2 In Review: Tesla (NASDAQ:TSLA) Vs Peers
As the craze of earnings season draws to a close, here’s a look back at some of the most exciting (and some less so) results from Q2. Today, we are looking at automobile manufacturers stocks, starting with Tesla (NASDAQ:TSLA).
Much capital investment and technical know-how are needed to manufacture functional, safe, and aesthetically pleasing automobiles for the mass market. Barriers to entry are therefore high, and auto manufacturers with economies of scale can boast strong economic moats. However, this doesn’t insulate them from new entrants, as electric vehicles (EVs) have entered the market and are upending it. This has forced established manufacturers to not only contend with emerging EV-first competitors but also decide how much they want to invest in these disruptive technologies, which will likely cannibalize their legacy offerings.
The 7 automobile manufacturers stocks we track reported a satisfactory Q2. As a group, revenues beat analysts’ consensus estimates by 5.4%.
After much suspense, the Federal Reserve cut its policy rate by 50bps (half a percent) in September 2024. This marks the central bank’s first easing of monetary policy since 2020 and the end of its most pointed inflation-busting campaign since the 1980s. Inflation had begun to run hot in 2021 post-COVID due to a confluence of factors such as supply chain disruptions, labor shortages, and stimulus spending. While CPI (inflation) readings have been supportive lately, employment measures have prompted some concern. Going forward, the markets will debate whether this rate cut (and more potential ones in 2024 and 2025) is perfect timing to support the economy or a bit too late for a macro that has already cooled too much.
Amidst this news, automobile manufacturers stocks have had a rough stretch. On average, share prices are down 11.4% since the latest earnings results.
Tesla (NASDAQ:TSLA)
Originally founded by Martin Eberhard and Marc Tarpenning in 2003, Tesla (NASDAQ:TSLA) is an electric vehicle company accelerating the world’s transition to sustainable energy.
Tesla reported revenues of $25.5 billion, up 2.3% year on year. This print exceeded analysts’ expectations by 3.1%. Despite the top-line beat, it was still a slower quarter for the company: Tesla missed analysts' operating profit estimates even when removing the impact of a one-time restructuring charge. This also bled down to an EPS and free cash flow miss.
Interestingly, the stock is up 2% since reporting and currently trades at $251.25.
Is now the time to buy Tesla? Access our full analysis of the earnings results here, it’s free.
Best Q2: General Motors (NYSE:GM)
Founded in 1908 by William C. Durant, General Motors (NYSE:GM) offers a range of vehicles and automobiles through brands such as Chevrolet, Buick, GMC, and Cadillac.
General Motors reported revenues of $47.97 billion, up 7.2% year on year, outperforming analysts’ expectations by 5.9%. The business had a stunning quarter with an impressive beat of analysts’ operating margin estimates.
Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 7.9% since reporting. It currently trades at $45.63.
Is now the time to buy General Motors? Access our full analysis of the earnings results here, it’s free.
Weakest Q2: Winnebago (NYSE:WGO)
Created to provide high-quality, affordable RVs to the post-war American family, Winnebago (NYSE:WGO) is a manufacturer of recreational vehicles, providing a range of motorhomes, travel trailers, and fifth-wheel products for outdoor and adventure lifestyles.
Winnebago reported revenues of $786 million, down 12.7% year on year, falling short of analysts’ expectations by 1.5%. It was a softer quarter as it posted a miss of analysts’ earnings estimates.
Winnebago delivered the weakest performance against analyst estimates and slowest revenue growth in the group. Interestingly, the stock is up 2% since the results and currently trades at $57.84.
Read our full analysis of Winnebago’s results here.
Rivian (NASDAQ:RIVN)
The manufacturer of Amazon’s delivery trucks, Rivian (NASDAQ:RIVN) designs, manufactures, and sells electric adventure vehicles and commercial delivery vans.
Rivian reported revenues of $1.16 billion, up 3.3% year on year. This number was in line with analysts’ expectations. Overall, it was an exceptional quarter as it also logged an impressive beat of analysts’ volume estimates.
The stock is down 29.6% since reporting and currently trades at $10.41.
Read our full, actionable report on Rivian here, it’s free.
Ford (NYSE:F)
Established to make automobiles accessible to a broader segment of the population, Ford (NYSE:F) designs, manufactures, and sells a variety of automobiles, trucks, and electric vehicles.
Ford reported revenues of $47.81 billion, up 6.3% year on year. This result surpassed analysts’ expectations by 6.5%. However, it was a slower quarter as it recorded a miss of analysts’ earnings estimates.
The stock is down 22.6% since reporting and currently trades at $10.57.
Read our full, actionable report on Ford here, it’s free.
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