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Why Tesla Stock Fell Over 2% in Premarket Trading Today

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Tesla ended 2018 on a positive note

American electric carmaker Tesla (TSLA) managed to end 2018 on a positive note with the help of solid gains in the fourth quarter. The company yielded a 6.95% return in 2018, including a 25.7% rise in the fourth quarter. In comparison, automakers General Motors (GM), Ford Motor Company (F), and Toyota Motor (TM) ended the fourth quarter with falls of 0.7%, 17.3%, and 6.7%, respectively.

TSLA stock was in negative territory in today’s premarket trading session. At 8:20 AM EST, it was down 2.2% from its previous session’s closing price. Let’s find out why.

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Stock weakness today

It’s important to note that Tesla is expected to release its fourth-quarter vehicle delivery and production figures any day this week. It has guided for the delivery of ~100,000 units of the Model S and the Model X without any key change on a YoY (year-over-year) basis in 2018. In the first three quarters of 2018, the company delivered ~71,760 units of these two vehicles, so it needs to deliver 28,240 more units in the fourth quarter to meet its guidance.

Estimates by insideevs.com suggest that Tesla’s fourth-quarter deliveries could reach 100,000 units, which would reflect an exponential rise in its 2018 production and deliveries.

In the third quarter, Tesla delivered (IYK) (XLY) ~83,775 car units to customers, up ~220% YoY and up 105% sequentially. Tesla delivered 27,710 units of the Model S and the Model X and 56,065 units of the Model 3 in the quarter.

TSLA’s fourth-quarter deliveries are likely to have a direct impact on its profitability, which is why investors might want to remain cautious ahead of its fourth-quarter data release. Futures market trading also suggests that the US market will open on a weak note on January 2, which could pressure Tesla and other automakers.

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