11:55 AM EDT, 10/21/2024 (MT Newswires) -- Tesla (TSLA) Q3 results are expected to meet analysts' expectations, with slight margin improvements, Wedbush said in an earnings preview Monday.

Investors will likely focus on Tesla Chief Executive Elon Musk's comments on the demand for consumer electric vehicles heading into Q4 and 2025 when the company reports its Q3 earnings Wednesday, Wedbush said. With in-line deliveries in Q3, Tesla's target of 1.8 million units for 2024 remains achievable, with a focus on surpassing 2 million units in 2025, the firm added.

The firm said it expects that the company's margins will be under scrutiny as the market seeks to confirm margin stabilization and recovery.

Strong sales in China during Q3 are expected to drive Q4 performance as well, the firm said. Still, the company faces challenges in Europe due to macroeconomic pressures and reduced subsidies, though these may be balanced by demand stabilization in the US and other regions.

"There are a lot of moving parts in the Tesla story over the next year but ultimately the encouraging China strength seen this quarter will be a linchpin for the bullish Tesla narrative looking ahead while the AI strategy evolves," analysts said in the note.

The firm maintained Tesla's outperform rating and $300 price target.

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