Tesla’s Earnings Report: A Crucial Moment for the "Magnificent Seven"
Tesla (TSLA) prepares to unveil its earnings on Wednesday, entering the spotlight as the weakest performer among the "Magnificent Seven" tech stocks. This group, which includes high-flying names like Apple (AAPL) and Meta (META), has seen varying degrees of success, with Tesla lagging significantly.
Since the market’s low on March 30, Tesla’s shares have risen just 11%, placing it at the bottom of this elite group. Year-to-date, the stock has faced a 12% decline, with only Apple doing worse. Recently, it ranked as the second largest decliner in the Magnificent Seven, outpaced only by Meta.
The one-year performance chart of Tesla depicts a stock stuck in a trading range, characterised by four significant phases:
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Sideways Consolidation: This phase saw Tesla’s price oscillating around the 200-day moving average throughout the summer months.
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Steady Climb: Following the summer, the stock experienced a steady rise into autumn.
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False Breakout: A significant rally pushed Tesla to all-time highs in December, but this was quickly followed by a failure to sustain those gains.
- Descending Trendline: Tesla’s stock entered a prolonged downtrend that culminated in the April lows, from which it has recently managed to break above.
As of Friday, Tesla closed just above its 200-day moving average, which currently hovers around $400. However, it dropped below this level today. It’s worth noting that flat moving averages can lead to increased volatility in stock behaviour.
The true measure of Tesla’s performance will emerge with Wednesday’s earnings report. This will not only provide insight into Tesla’s financial health but also indicate whether the Magnificent Seven can maintain their leadership as the broader market rallies. Since the March 30 low, this group has outperformed all major indices, with Tesla being the first to present its results.
Key Levels to Watch:
- If the stock surpasses $400, the next resistance zone to watch lies between $450 and $460.
- Conversely, for bulls, maintaining support in the $335 to $340 range is vital, as it marks the floor established by the recent April lows.
Jared Blikre is Yahoo Finance’s global markets and data editor. He can be reached on X at @SPYJared or via email at jaredblikre@yahooinc.com.
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