Notably, Reuters reports that Tesla sold 78.906 electric vehicles produced in China in June.
That's more than double the 32.165 vehicles Tesla managed to produce in China in May. This is a huge turnaround from April, when Tesla's Gigafactory in Shanghai was mostly closed during a crackdown on the spread of the coronavirus and produced just 1.500 cars. According to Reuters, the 78.906 cars produced in June set a new record for Tesla's Chinese plant.
And to put the icing on the cake, Reuters confirms that Tesla's Model Y electric crossover was the "best-selling model of all passenger vehicles" in China for the first time in June.
It appears to test the theory that slowing growth in China over the past couple of months has created significant pent-up demand for the company's products. The Investors who were scared earlier in the week about not meeting the delivery target for the second quarter of 2022 appear to have overreacted, and as June numbers begin to confirm pent-up demand, Tesla shares are already starting to recover from that sell-off.
The other good news is that, after accounting for Tesla's non-delivery, analysts have lowered their expectations for Tesla's earnings for the full year again, to about $ 10,36 per share, according to S&P Global. Market Intelligence. This makes it even easier for Tesla's resumption of sales to lead to an increase in earnings over the course of the year.
Tesla shares are up today. At 72 times current year earnings, the stock remains far from cheap. But now he has the momentum on his side and investors shouldn't discount the potential for further good news to push the stock even higher.
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