Tesla stock initiated at 'sell' after disappointing Q4 results

Tesla Inc (NASDAQ: TSLA) is trending down in extended hours on Wednesday after reporting disappointing results for its fourth financial quarter.

What else is weighing on Tesla stock?

The stock is in the red because total gross margins took a 620 basis points hit in the recently concluded quarter.

That metric printed at 17.6% versus 23.8% in the same quarter last year; part of the reason why Adrian Yanoshik – a Redburn Atlantic analyst is dovish on the electric vehicles behemoth. On Wednesday, he told clients in a research note:

His “sell” rating on $TSLA comes with a $170 price target that suggests about an 18% downside from here.

Notable figures in Tesla Q4 earnings release

• Earned $7.92 billion versus the year-ago $3.69 billion
• Per-share earnings also declined from $1.07 to $2.27
• Adjusted EPS printed at 71 cents as per the press release
• Revenue jumped 3.0% year-over-year to $25.17 billion
• Consensus was 74 cents a share on $25.60 billion in revenue

The earnings report arrives a couple weeks after Tesla Inc again lowered prices of its vehicles in China. Yanoshik also said in his research note today:

Tesla to sell fewer vehicles in 2024

Tesla stock is losing in after-hours also because the EV giant warned of a "notably lower" vehicle volume growth rate this year as it commits to making its "next-generation vehicle at Gigafactory Texas".

Note that Tesla Inc started delivering its Cybertrucks to customers in Q4. The Nasdaq-listed firm now has capacity to manufacture over 125,000 of its pickup trucks annually. According to its presentation to investors today:

Earlier in January, the automaker had reported better-than-expected deliveries for the fourth quarter. $TSLA is now down over 30% versus its 52-week high.