Apple and Tesla Earnings Preview
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Apple earnings and Tesla earnings are both coming out over the next 48 hours! Many of you guys hold Apple stock or Tesla stock so this should be really for you guys! Enjoy!
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Whoo in the next 48 hours, it is about to go down. Apple and Tesla stock are both reporting earnings over the next 48 hours. So what I want to go through here with you guys here today are Apple’s expected numbers.
Okay, the analysts are expecting them, we’ll go through Tesla’s expected numbers that I’m going to give you my opinion on if these companies can beat these earnings, if so, why, if they’re going to miss why.
And I also want to get into Am I going to buy more shares, if the stocks go down, or our sell off, if they go up a bunch and all those type of things, if you don’t already know, Apple is by far and away my wife’s biggest position in her account.
I think our cost base is somewhere around 161 70. And then I just bought around $18,000 of Tesla stock, that’s kind of like my spec stock, I’m playing for the next five to 10 years, so important stocks to us.
And honestly, Apple is a company that almost every single person is affected by Okay, the apples wait on the markets, if Apple moves down in a big way, a lot of times the entire market will move down.
A lot of times if Apple moves up, it can help boost the whole market. Also, if you own a mutual fund, if you have a 401k or something like that, there’s a good chance Apple shares are in there, okay.
Or you might own Apple shares directly or you might even own a semiconductor supplier whose biggest customers probably Apple guys, so a very, very important company. So we’re going to get into all this.
We’ll do Apple first and we’ll do tough, so then we’ll do my opinion on these two companies if they’re going to miss or beat and those types of things. Okay, so Apple revenue is expected to be $52.3 billion for the quarter.
That would be up around 15%. year over year, okay, which is pretty nice growth. Okay, that’s pretty nice growth there for Apple 15 plus percent growth of how big this company already is.
To be grown. Like that is nice. Where it really gets impressive is epcs. Okay, so analysts are expecting the company do $2.18 that’s versus last year, they did $1.67. This is a massive, massive raise up is a 30% plus number year over year, okay, it was expecting their EP s to go up over 30% year over year, guys.
That’s a massive, massive move there. Okay, so that will definitely have to talk about that number, if if that’s beatable there, okay, um, the revenue guidance is always going to be very important for Apple.
Okay, that’s what was one of the most talked about things in regards to Apple. Eight also expected somewhere around 50 $59.5 billion of revenue guidance. Last year, they did 52.5. So that would be around 13%. year over year there.
As far as iPhone units. This is always the number that’s probably talked about, and more than anything, even more than APS are revenue, iPhone units. iPhone units, analysts aren’t expecting crap for this past quarter.
Okay, they only expecting around 1% growth year over year in iPhone units. Okay, so this is probably the lowest bar I’ve seen Apple have in a long, long time. In regards to iPhone units, they aren’t expecting anything a 1% rise there.
Now, this is not an analyst thing. This is just something I want to bring your attention to Apple needs less than a 10% move up in stock price, I think it’s around a 7% or 8% rise from from today’s valuation to be the first public company in history to hit a $1 trillion market cap.
Okay, so tomorrow night, if Apple report some really good numbers in that stock starts moving up, man, all it’s got a nice, I think it’s around a seven or 8% gain, basically, to hit a $1 trillion market cap.
Which would be just a cool thing for the stock market has never ever been a public company that has hit a $1 trillion valuation, it would be pretty neat guys, just for the stock market overall.
So those are the apple expected numbers. Now we’re going to get into tests. And then we’ll get into my opinion on both of these stocks already, guys. Now I want to get into what is expected from Tesla.
And also what are some questions our analysts are probably going to ask on that conference call. And then we’ll get into my opinion on both the stocks if I’m going to buy more sell off after the earnings and kind of like if they can beat numbers and whatnot.
So Tesla is expected to revenue of around $4 billion. That’s versus a year ago, they did around 2.8 billion. All right. That’s a 42%. year over year. Okay, a big big number but Tesla’s in major growth mode right now.
42% revenue growth year over year epcs is expected to get much uglier year over year. So this quarter, they’re expected to do negative $2.81 per share, versus the same time last year they did $1.33 year ago.
Why is that? Because they’re ramping model three is a very costly thing to do. Okay, whenever you ramp a vehicle like this, especially in the scale Tesla’s doing it, it’s a very, very costly proposition.
Plus, they’re going to have some employee employment restructuring going on because they laid off a lot of employees, especially if some of their solar divisions and things like that, that they felt like were kinda you know, jobs, just they you know, they didn’t eat and whatnot.
So the lot of those charges are going into this quarter. Something to keep in mind there. Now next quarter analysts are expecting at 8% revenue growth year over year. Yes, you heard me right at 8%. revenue growth is expected year over year in the next quarter.
Okay, so that’d be very, very interesting to hear what you know, Tesla has for guidance around that revenue number for next quarter because that is huge. Guys, that is absolutely huge.
All right, so three questions I think analysts are going to kind of ask in this conference call. One is model three ramp and what’s the demand? So we’re gonna talk about is demand falling for model three is.
You know, and can they really ramp over 5000 vehicles, we’ve seen them get up to 5000 vehicles, can they get up to a 6000 7000 8000, maybe even a 10,000 number there. And once again, but demand like that’s been a big focus from some of the short sellers out there is there as much demand.
You know, what, let’s one minute they’re trying to point the finger at they can’t produce enough cars, the next minute, they’re trying to point the finger at the, you know, the company doesn’t have demand or something like that.
It’s pretty funny. So it’ll be very important to hear what you know, management has to say about that. This is even a more important question, my personal opinion, how is it China in Europe factory going to get paid? Okay.
How are these factory these are going to be a billion dollar plus projects? Okay, probably multi billion dollar projects, one in China, and the one in Europe? What does management have to say about this? Okay, the China one’s already been announced in the Europe.
One could probably be announced within the next few months. So what does management have to say about this, like, who’s gonna pay for this, okay, we don’t test it doesn’t have much money left on that balance sheet.
And the way they’ve been losing money, like, like, they can’t go down to zero, okay, so they’re gonna either need to raise debt, they’re going to do need to do a capital raise of some kind where they issue some more stock.
Maybe they do joint venture where somebody else builds it in, you know, Tesla just leases that factory from them. We don’t know what the situation is, but it’s going to be very important.
I really hope that analysts kind of ask that question and dig in there. Cuz like, how are these factory there’s both of them are going to be multi billion dollar factories, who’s going to pay for this? Okay.
And maybe there’s a wild card that Tesla is just going to become a unbelievably profitable overnight, which I don’t know if that’s, you know, really gonna play out that way. But if that’s if that happens.
I mean, maybe they could pay for cash, but man, that’s pretty, it’s pretty unrealistic. Okay. And also, the other question is, when will energy scale so energy, so much focus around Tesla has just been on the cars, the model three, okay.
That’s been the whole focus going on right now. And that’s where, you know, the bulls and the bears, honestly, most of the time, spend their time, you know, focusing, this could mess up, everybody’s numbers out there, okay.
Bulls in bears energy, this is a big wildcard out there. Okay, if energy starts to scale in a major way, they have a lot of pent up demand. But they haven’t really even been trying to sell that aggressively.
They took that out, they went out of the Home Depot stores, mainly because they already had so much demand, they weren’t doing enough supply management only has so much time, they only have so much money to go around right now.
Okay, so they’ve been focusing on the car side of the business. But when is energy going to scale in a major way? I think that’s a big question. Because going into 2019, if energy scales in a major way.
That that revenue growth could get accelerated in a massive, massive way, it just depends on if Tesla has the money to fund that it has hadn’t have the resources to fund that, you know, hold the whole energy side of their business to really get that ramping.
And my goodness, if they can really get that ramping, plus you have the model three ramp, and let’s say they get to a place where they’re doing, you know, 8000 to 10,000 model threes per week, we’re talking about it could be a crazy year in 2019.
Okay, so no, that’s what is expected from from Tesla analysts. And that’s also the questions I expect the analysts to really you know, drive into during the conference call. Now, let’s get into apple and Tesla do I think they’re gonna beat.
Am I gonna sell them I’m gonna buy anything like that. Already. Guys. Now for the fun part to get into what I expect from these companies and if I will be buying more or selling or any of those things after this quarter. Okay.
So first off, let’s talk about Apple. I think Apple’s numbers are very, very beatable. Okay. Why did I forget the why and I think Apple’s numbers are very beautiful. Here’s why. Okay, 15% revenue growth is expected for this past quarter.
30% APS growth. Why are those numbers beautiful? Well, two reasons. Okay. One is ASP is on iPhone have exploded, they’re well over $100 more expensive than the previous year. Okay.
So that is a big factor. If you if they can just keep iPhones around the same or get that 1% raise that analysts are expected, the revenue is going to explode there, the profitability of those phones is much higher because they’re bigger dollar amount, okay.
On the margins are somewhat similar. So needless to say, like, it’s pretty, pretty beatable, then on top of that services just grew in the last quarter over 30%. If services can grow, you know, 25 to 30%, that’s massive for this company.
Because those numbers are starting to get really big and services now that’s actually their second biggest business going forward. Okay. And they’re buying back massive amounts of shares on top of all this, okay.
Which helps the NPS dramatically. So when you factor in all those things, I think revenue and DPS are definitely very beatable numbers, I think there’s a good chance they could beat him with an impressive beat on both of those lines.
We’ll just have to see, okay, this quarter next quarter, or the last super impressive quarters, in my opinion, in terms of revenue growth and DPS growth, especially in terms of revenue growth. Why? Well basically.
The iPhone 10 will start to lap Okay, that $1,000 iPhone, that’s going to start to lap in the next year now and also the services I expect some deceleration in the 2019 of services revenue. Okay, there’s 30% and clip that.
You know, they’ve been doing and whatnot. I do not think that’s sustainable over the long term, I think. I think a 20% or somewhere around there is probably sustainable at least over the next year.
But there’s 30% Plus, I do not think this can keep up over 2019. If it does, that’s a huge surprise to me. I welcome. I just don’t see that happening. Okay. So in terms of Apple, this quarter we’re in right now.
In next quarter, I think of the last super impressive quarters. I think next year, they can still grow APS by, you know, double digits, let’s say 10% Plus, but revenue growth, I think it’ll be in the single digits throughout 2019 or somewhere around there.
Okay, maybe even flattish, to be honest. Okay. Which leads me into my next point. 2019 is going to be super lame for Apple in my opinion, I think it’s going to be a lame year for Apple stock.
There’s sometimes a you know, just lame year for Apple stock, because of their numbers and whatnot. I think that’s just how 2019 is gonna end up playing out. Now over 2020 could be a very exciting year for this company.
Why? Because the 2020 iPhones could be the next super cycle of iPhones because it would be the 5g iPhone. We’re not 100% sure if the 5g iPhones are coming out, which basically they would be announced in September or October of 2019. Okay.
But basically all the sales would happen throughout 2020. All right, the 5g iPhone is the next supercycle when they come out with that everybody’s going to want to jump on that 5g bandwagon because if you know anything about 5g versus 4g.
They’re really not even comparable. Okay. The speeds everything you can do across the board is unbelievable with the 5g iPhone, so I think 2020 could be a real interesting year if they end up announcing the 5g iPhone at some point.
You know, toward the end of 2019 2020 could get really really exciting guys because we haven’t seen a major supercycle on iPhone since iPhone six which was a bigger device you really have to have something huge in order to get a supercycle going, Okay.
It can’t just be Oh, there’s a new cool feature here new cool, cool feature there. 5g is a massive Okay, it’s the biggest thing to happen the iPhone since they literally increase the size of the iPhone.
So I think 20 20% of the supercycle if that’s even the year they come out with the 5g iPhone, which I think they can Okay, we will not sell regardless if the stock moves up big after earnings.
It goes to trillion on market cap, we won’t sell like there’s a long term hold for us. I hope I hope 2019 is weak for Apple stock. I really do. I hope it’s weak. I would love to add more and more shares.
I don’t own any Apple shares at any of my accounts. Okay, my wife is by far her biggest position. I don’t own any shares in my my accounts, I would love to add a huge position of apple in 2019.
So I’m hoping I’m keeping my fingers crossed that Apple stock actually moves down on these earnings and just has a week 2019 so I can buy throughout the year. Okay, that’s kind of what I’m hoping there.
Let’s get into Tesla, Tesla, I’ll be flat out honest. I don’t know if they’re gonna beat these earnings. This is my first earnings holding the stock. Okay, I don’t have a good enough idea yet.
Because I’m, you know, just got into the stock that Oh, can they beat numbers or miss numbers? I don’t know. Okay, so I’m not gonna put my head out there and say, Yes, they’re gonna beat or they’re gonna miss I you know, to be honest.
I don’t know, this is my first earnings actually holding the stock, okay. But I will go out there and make this statement. Okay, I expect revenue growth of over 50%. For the next three years for this company.
Analysts only expect revenue growth over 50%. For the remainder of this year we’re in Okay, I expect 50%. Plus, for the two remaining years after that meaning 2019 and 2020. analysts have somewhere around 42% revenue growth for 2019.
I expect it to be over 50% Okay, and the following year, why two reasons. Tesla energy has to ramp Okay, this is gonna ramp and that’s gonna, that’s gonna kill everybody’s numbers out there that, you know.
Has low expectations for Tesla, in my opinion, okay, model three will continue to ramp up be able to produce more and more per week. All right, as word gets a word of mouth gets out there more and more people want to buy Tesla’s and things like that.
Okay, as you see more in the streets, and you see some of the cool features it has and whatnot, I think and especially as a $35,000 model actually is available, okay, that’s going to be massive for this company. Okay.
So those are two massive things. Also, you’re going to have, you know, the Tesla semi coming with. So cemaes are not going to be cheap, okay, those are going to be very expensive models.
So it’s not like they need to move mass amounts of units of the semi, if they can just move, you know, a few 1000 units a year, like that’s a massive, massive number for the company.
Those are going to be very high, highly priced.Also in 2020, the Roadsters coming, we could have the model y coming which is probably the biggest thing other than model three that this company has going forward.
Model three and Tesla you know, the energy products have huge, but model y the mass SUV, guys, that is going to be off the charts, okay? Because a lot of people like myself that would love to have a Tesla SUV, but at the same time.
We don’t want to pay 100,000 plus dollars, which if we got the Tesla Model X it’d be 100,000 plus dollars. In my opinion, I don’t feel like spending 100,000 plus dollars on an SUV, okay, I’m fine with spending 4050, maybe even $60,000 an SUV.
I’m not spending $100,000 plus, so the model y can be their answer for customers like myself who want a nice SUV that’s electric, but don’t want to spend 100,000 plus dollars Like you know, the Tesla Model X is okay.
So the stock has a lot of catalyst going forward over the next few years Okay, I hope it moves up. The reason being is honestly I don’t want to buy more shares this is my spec stock that I’m holding for the next 510 years.
I’m not buying more shares the stock a rule I learned Okay, this is a secret I’m going to let you know right now that no one knows Okay, when I first got bought GoPro shares, I bought that as a spec stock.
It was a very small position of mine and then it dropped in I started building a bigger bigger position till it was also my biggest position in my portfolio. Okay, that was stupid. You should never turn a spec stock into a major investment.
I refuse to do that with Tesla regardless of how much it drops Okay, I don’t care if it goes down $200 I don’t care if it goes down $150 a share I’m not adding more shares of stock regardless Okay, it’s a spec stock and I learned a lesson with GoPro Okay.
So I hope it moves up that would be awesome because you know, like I said, I’m not buying any more shares I hope it moves up. The interesting thing is there’s a lot of Facebook money out there right now okay.
A lot of investment funds a lot of high growth investors have sold off of Facebook where’s that money going to go? We know it’s not going in Netflix stock Okay, Netflix is down 95% plus today so we know all that growth money that’s coming from Facebook.
It’s not going into Netflix stock so we have all this growth money for you know that people that have sold off shares investment fund managers that have loved the high growth companies.
Those companies growing revenues at 40% plus clip where’s that money going to want to flow Okay, there’s a good chance it could flow to Tesla why because this is a test this is a company that has a massive revenue increase coming over the future years even if they don’t hit my number.
The analysts are still expecting this company grow 42% plus next year okay, so where’s that Facebook money gonna go? Where’s that Facebook money gonna go? A lot of it could flood in Tesla.
Where it’s gonna have to see Okay, I will not sell regardless of what Tesla shares though. I don’t care if it went to $500 a share I wouldn’t sell Okay, that’s just that’s just where I’m at with that.
So I hope you guys enjoyed this. Let me know in the comment section if you’re planning on buying Apple stock or Tesla stock, I would love to hear from you guys. If you hold either of those stocks.
What are your expectations for these earnings? I would love to hear from you guys in that comment section. As always, make sure you follow me on Instagram if you have not already. Thank you for watching. Have a great today.