It's not the time to buy Tesla stock, according to one investor.
Ahead of the Tuesday afternoon release of the company's highly anticipated second-quarter delivery results, which surprised to the upside by setting new delivery and production records, experts warned that even a fundamental win won't correct the technical breakdown in Tesla's stock.
"If you want to own a company like this, you believe in [CEO] Elon Musk, as I do — and I've owned it in the past — you're owning the belief in the entrepreneur, the optimism surrounding the technology, but you cannot own this stock on a fundamental reason at all, " Quint Tatro, chief investment officer at Joule Financial, said Tuesday on CNBC's "Trading Nation."
"It's very, very difficult. There's really no financials to speak of," Tatro said, citing the company's plans to raise capital through equity and debt markets. "There's no reason to be a buyer here, or, quite frankly, until they get these financial numbers figured out and we know, really, where the company stands."
Tatro deferred to Craig Johnson, managing director and senior technical research analyst at Piper Jaffray, whose technical analysis reinforced the gloom hanging over Tesla's stock, which is down nearly 30% year to date.
"When you look at the chart, you'll see that this is a stock that had broken below a multiyear consolidation range channel," Johnson said in the same "Trading Nation" interview. "It's having a nice little relief rally in here, but unless this stock can recapture the lower end of that consolidation range around $240, I suspect that the stock is perhaps going to stall here."
If it does stall, Johnson expected another leg lower, diverging from his firm's Tesla analyst, Alex Potter, who rates the stock a "buy" with a $396 price target. Tesla shares were trading around the $237 level early Wednesday.
"Technically, we look at this chart with a little bit more of a cautious perspective, as we haven't recaptured that trading range, and it still looks like just a relief rally to us," Johnson said.
Wall Street analysts also remained largely cautious on Tesla despite its positive results for deliveries.