Is Tesla Stock a Smart Bet Ahead of Q3 Earnings? Key Insights

Tesla TSLA is slated to release third-quarter 2025 results on Wednesday, after market close. The Zacks Consensus Estimate for the to-be-reported quarter’s earnings and revenues is pegged at 53 cents per share and $26.45 billion, respectively.The earnings estimate for the to-be-reported quarter has been revised upward by 1 cent over the past seven days. Nonetheless, the bottom-line projection indicates a year-over-year decline of 26.4%. The Zacks Consensus Estimate for quarterly revenues suggests a year-over-year uptick of 5%. Image Source: Zacks Investment ResearchFor the current year, the Zacks Consensus Estimate for TSLA’s revenues is pegged at $93 billion, implying a decline of 4.7% year over year. The consensus mark for 2025 EPS is pegged at $1.63, suggesting a drop of around 33% on a year-over-year basis.In the trailing four quarters, this electric vehicle (EV) giant beat EPS estimates on two occasions for as many misses, with the average negative earnings surprise being 3.65%.Tesla, Inc. Price and EPS Surprise Tesla, Inc. price-eps-surprise | Tesla, Inc. QuoteQ3 Earnings Whispers for TeslaOur proprietary model predicts an earnings beat for Tesla this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That’s the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.TSLA has an Earnings ESP of +4.05% and a Zacks Rank #3.You can see the complete list of today’s Zacks #1 Rank stocks here.Record Deliveries, Energy Deployments to Aid TSLA Q3 ResultsTesla delivered 497,099 cars (481,166 Model 3/Y and 15,933 other models) worldwide in the third quarter, setting a new record. The figure rose 7.4% from the year-ago quarter, after three consecutive quarters of year-over-year decline. The deliveries also beat our model estimate of 435,370 units. The EV tax credit of $7,500, which expired at the end of September, boosted Tesla’s deliveries in the quarter under review. Many customers are likely to have rushed to purchase vehicles to take advantage of the incentive, fueling demand.It wasn’t just Tesla that benefited from this “pull forward” effect. Auto giants like Ford F and General Motors GM also logged record EV sales for three months ending September. Ford’s EV sales surged more than 30%, while General Motors more than doubled its tally.Along with better-than-expected deliveries, Tesla is also expected to have benefited from its Energy division. The company’s Energy Generation and Storage business is getting a boost from strong demand for Megapack and Powerwall products. Tesla deployed 12.5 GWh of energy storage products in the third quarter of 2025, setting a new quarterly record.Tesla Price Performance & ValuationOver the past six months, shares of Tesla have rallied 93%, outperforming the industry as well as peers like General Motors and Ford.6-Month Price Comparison  Image Source: Zacks Investment ResearchTesla stock is quite overvalued. Going by its price/sales ratio, the company is trading at a forward sales multiple of 13.9, higher compared to the industry as well as its own 5-year average. Image Source: Zacks Investment ResearchHow Should You Play TSLA Pre-Q3 Earnings?Tesla has seen several interesting developments lately. CEO Elon Musk’s decision to step away from politics, the board’s proposed $1 trillion pay package, and his $1 billion stock purchase have been interpreted as signs of renewed commitment. Tesla’s board believes Musk’s leadership is essential as the company pivots aggressively into artificial intelligence (AI), autonomous driving and robotics. His share purchase further reinforced that narrative.However, these long-term projects — including AI, robotaxis, and humanoids — may take years to materially impact results. Meanwhile, Tesla’s core EV business faces intensifying competition and slowing demand overseas. The company sold around 1.2 million vehicles through the first three quarters of 2025, slightly down year over year. Indeed, the third performance was solid but largely mirrored broader industry momentum. Musk had warned of “rough quarters ahead” on the second-quarter earnings call. That makes third-quarter commentary especially important.On the brighter side, Tesla’s energy storage segment should keep benefiting from rising demand from power-hungry AI data centers, with Megapack installations offering a strong tailwind.While Tesla may beat near-term earnings expectations this earnings season, the bigger question is whether the stock’s current price already reflects much of the optimism. Investors should pay close attention to management commentary on robotaxis, Optimus, and the impact of removal of EV tax credits. Given near-term headwinds and execution risks, it may be wise to wait for a better entry point.#1 Semiconductor Stock to Buy (Not NVDA)The incredible demand for data is fueling the market's next digital gold rush. As data centers continue to be built and constantly upgraded, the companies that provide the hardware for these behemoths will become the NVIDIAs of tomorrow.One under-the-radar chipmaker is uniquely positioned to take advantage of the next growth stage of this market. It specializes in semiconductor products that titans like NVIDIA don't build. It's just beginning to enter the spotlight, which is exactly where you want to be.See This Stock Now for Free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Ford Motor Company (F): Free Stock Analysis Report General Motors Company (GM): Free Stock Analysis Report Tesla, Inc. (TSLA): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks