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Why Tesla Stock Jumped on Friday

By Daniel Sparks - Updated May 1, 2021 at 12:28AM

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Could Tesla's sales this year grow more than analysts are currently modeling for?

What happened

Shares of Tesla (TSLA 1.24%) spiked higher on Friday, rising as much as 5.7%. By the time the market closed, however, the stock was up 4.8%. The stock's gain impressively came as the overall market declined sharply. The Nasdaq Composite, for instance, fell 0.85%.

Shares of the growth stock are likely up due to a couple of items circulating on Twitter that indicate the company may be having a better 2021 than some analysts are planning for.

Interior of the redesigned Tesla Model S.

Image source: Tesla.

So what

As a Barron's article pointed out earlier today, New Street analyst Pierre Ferragu noted on Twitter that STMicroelectronics -- a Tesla supplier -- expects sales of its silicon carbide to reach $550 million this year. This implies Tesla may be ordering enough silicon carbide to support production of 1 million vehicles this year, according to Ferragu's estimates.

In addition, some have pointed out on Twitter that Tesla's most recent 10-Q filing notes, "During the first quarter of 2021, the operational milestone of annualized revenue of $55 billion became probable of being achieved..." For some context on Tesla's current estimated sales trajectory, the average analyst estimate calls for 2020 revenue of about $50 billion.

Now what

Tesla has remained somewhat vague about its expectations for 2021 vehicle deliveries, only saying that it expects total deliveries this year to grow by a rate greater than 50% year over year. But after blowout first-quarter deliveries and given the company's rapidly increasing production and its record quarterly vehicle orders in Q1, it's starting to look like Tesla can grow its deliveries at a significantly greater rate than 50% year over year in 2021.

Editor's note: A previous version of this article stated that the operational milestone of annualized revenue of $55 billion was probable for 2021. But Tesla did not state a timeframe in its 10-Q and simply stated that its operational milestone of annualized revenue of $55 billion was now probable. The author regrets this error.

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Stocks Mentioned

Tesla, Inc. Stock Quote
Tesla, Inc.
TSLA
$681.79 (1.24%) $8.37
STMicroelectronics N.V. Stock Quote
STMicroelectronics N.V.
STM
$30.40 (-3.40%) $-1.07
Twitter, Inc. Stock Quote
Twitter, Inc.
TWTR
$38.23 (2.25%) $0.84

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