Tesla, Inc.'s (NASDAQ: TSLA) strong second-quarter delivery numbers failed to attract an analyst at Needham into the bullish camp.
The Tesla Analyst: Needham analyst Chris Pierce reiterated a Neutral rating on Tesla stock.
The Tesla Thesis: Tesla's inventories grew at a slower rate and this should encourage the bulls, Pierce said in a note. That said, the uncertainty wasn't fully resolved as inventories still grew on an absolute basis, he added.
The bulls may also feel more comfortable about a margin trough nearing, the analyst said. The bears, however, are likely to remain unconvinced, he added.
The Cybertruck initial production and launch headlines will likely be a win for the bulls, Pierce said, adding that any modest production pushout or any negative reviews could be looked past.
"We expect the Cybertruck to be a niche vehicle, but given the size of the reservation book and high purchase intent, TSLA won't have to win over new consumers soon," the analyst said. Therefore, the "short the launch" thesis of bears will likely struggle to gain traction in the near term, he said.
Pierce said Tesla's Supercharger network has created a moat for its vehicles over time but he views the move to opening up the EV maker's charging network to other OEMs as a negative.
Even if Needham's 2026 Services and Other revenue estimates for Tesla double, the firm's 2026 earnings per share estimate will move up by merely 1%, given the low gross margin nature of the business, Pierce said.
"TSLA's stock performance is likely to be dictated by unit sales and gross margins, and we view TSLA opening up its charging network as a negative for unit volumes," he added.