Tesla Stock Could Swing 5% After Today's Earnings

This article first appeared on GuruFocus.

Tesla (NASDAQ:TSLA) is scheduled to release first-quarter results after the bell on April 22, with options traders pricing in a move of about 5% after the report.

Tesla is expected to post earnings of 37 cents a share, up 38% from a year earlier, on revenue of $22.7 billion, which would be 17.5% higher. Gross margin is forecast at 17.8%, while full-year capital spending is seen rising to $18.2 billion from $8.5 billion.

Tesla shares have dropped about 30% since late January, a decline that has put attention on the company’s spending plans as much as its growth outlook. The stock’s one-week implied volatility was near 60% as of the April 20 close, a level that is low by Tesla’s standards.

Tesla options positioning suggests resistance around $400 and support near $380, with dealer hedging flows likely to help keep the stock in that band. Even with a solid report, the market appears to be braced for a fairly contained reaction.