Wall Street Brunch: Tesla Reports As Earnings Season Picks Up

Wall Street Breakfast5.74M FollowersSubscribe5ShareSaveCommentsSummaryTesla (TSLA) reports Q1 earnings Wednesday amid concerns over weak deliveries, rising inventory, and muted free cash flow growth.Valuation debates are central: one analyst rates TSLA Buy for AI and robotaxi growth, while another calls for Strong Sell citing execution risks and 'cult-like' valuation.Broader earnings season accelerates with 93 S&P 500 companies reporting, including GE, 3M, IBM, Intel, and Procter & Gamble.Retail sales data and geopolitical tensions, particularly involving Iran, may influence consumer resilience and market sentiment this week. Alexander Shapovalov/iStock Editorial via Getty Images Listen below or on the go on Apple Podcasts and Spotify Tesla leads a busy week as 93 S&P 500 companies report. Bull and bear case. (0:17) American rejects merger talks with United. (1:34) March retail sales are expected higher as gas prices cloud demand. (2:18) The following is an abridged transcript: Earnings season shifts into higher gear this week, with 93 S&P 500 companies reporting, including seven Dow components. Tesla (TSLA) will be the first of the Magnificent 7 to report when it delivers results Wednesday. Analysts expect Q1 EPS of $0.36 on revenue of $22.34B, though recent delivery data have raised concerns. Tesla produced 408,386 vehicles and delivered 358,023 — below Bloomberg estimates. Days of inventory rose to 35 from 21 in the prior quarter, the highest level since UBS began tracking the metric, pointing to potential demand bottlenecks. Analysts also note muted free cash flow growth. Seeking Alpha analyst Oliver Rodzianko, who rates the stock a Buy, says valuation is stretched with limited margin of safety, but believes forward growth, AI scaling and robotaxi positioning e. Agar Capital, which has a Strong Sell, argues that despite innovation and AI potential, Tesla’s current financials and execution risks do not justify what it calls a “cult-like” valuation. Also on the calendar: GE Aerospace (GE), 3M (MMM), Halliburton (HAL) and United Airlines (UAL) report Tuesday. Philip Morris (PM), IBM (IBM) and Boeing (BA) weigh in Wednesday. Intel (INTC), American Express (AXP), Gilead (GILD) and Blackstone (BX) report Thursday. Procter & Gamble (PG) closes out the week on Friday. In the news this weekend, American Airlines (AAL) said it has not engaged in merger discussions with United Airlines (UAL) and is not interested in pursuing such a deal. Bloomberg reported that United CEO Scott Kirby had raised the possibility of a combination in conversations with senior government officials. “While changes in the broader airline marketplace may be necessary, a combination with United would be negative for competition and for consumers,” American said. Separately, President Donald Trump accused Iran of violating a ceasefire after Iranian forces reportedly fired on vessels in the Strait of Hormuz, including a French ship and a British freighter. In his strongest warning yet, Trump said that if Iran rejects the deal currently on the table, the United States would “knock out every single Power Plant, and every single Bridge, in Iran.” On the economic front, March retail sales data arrive Tuesday, with economists expecting a 1.3% rise overall and a 0.9% increase excluding autos. Wells Fargo economists say consumers have so far appeared largely unfazed by the initial move higher in gas prices. High-frequency credit card data from Bloomberg suggest households continued to spend into early April. However, they caution that any outsized gain may reflect higher gasoline prices rather than stronger underlying demand. “We expect continued but slower spending in the wake of the ongoing conflict in Iran, as higher tax refunds and after-tax incomes are largely offsetting the initial hit from higher gas prices,” they wrote. “The longer this goes on, and the broader inflationary pressure becomes, the more concerned we grow about consumer resilience.” And for income investors, Caterpillar (CAT) goes ex-dividend on Monday, with a May 19 payout date. Dell (DELL) follows on Tuesday, paying out May 1. Lowe’s (LOW) goes ex-dividend Wednesday and will distribute on May 6. And CVS Health (CVS) rounds out the week on Thursday, with a May 4 payout.This article was written byWall Street Breakfast5.74M FollowersSubscribeWall Street Breakfast, Seeking Alpha's flagship daily business newsletter, is a one-page summary that gives you a rapid overview of the day's key financial news. It is designed for easy readability on the site or by email (including mobile devices) and is published before 7:30 AM ET every market day.

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