Tesla, Inc. TSLA shares fell about 12% Thursday in reaction to the EV maker's fourth-quarter results.
Loup Funds Managing Partner Gene Munster delved into what may have triggered the sell-off.
Tech Investors On Edge: The December quarter results come at a time when "the investment pendulum has swung from fear of missing out in 2021 to fear of getting run over in 2022," Munster said in a note. Investors seem to be jittery over the uncertainty surrounding the pace and slope of interest rate hikes by the Federal Reserve, he added.
Additionally, the bar is higher for high-profile tech names, the analyst said.
"That said, it's one thing for a company not to get full credit for its financial progress, it's another for shares to be punished on a good report," Munster wrote in the note.
Related Link: EV Week In Review: Tesla Raises Concern Over Future Growth, Lucid Going Places, GM Aims EV Leadership And More
Shift In Red Hot EV Investing Theme Of 2021: Every year has a class of investing themes that typically don't repeat in the subsequent year, Munster said. The analyst noted that 2021 was about big EV companies and traditional auto stepping into the EV game.
Rivian Automotive Holding, Inc. RIVN and Lucid Group, Inc. LCID rallied big in 2021 and legacy automakers were also on a tear, the analyst noted.
The year 2022 could be a challenging one for Rivian and Lucid when it comes to ramping up deliveries in a tight supply chain environment, Munster said. If these challenges play out, the EV theme may see continued pressure, he added.
Long-tern Fundamentals Look Solid For Tesla: Tesla is profitable with impressive growth, as the company targets large addressable markets, Munster said. This growth in all likelihood will continue, he added.
The 50% average growth rate Tesla is modeling over the next decade implies a 60+% rate in the near-term, declining to 30% growth in the out years, the analyst clarified.
Given the company's product roadmap, production ramp, and macro EV tailwinds, Munster expects Tesla's industry-leading delivery growth rates to continue.
"In the meantime, shares of TSLA will be a rollercoaster as investors look to gain confidence that the good times at Tesla are just beginning," the analyst said.
Tesla closed Friday's session up 2.08% at $846.35.
Related Link: Tesla Falls On Q4 Earnings: 3 Analysts On What's Next For EV Stock
Photo: Courtesy of tesla.com
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