Subject: Tesla Motors (Nasdaq: TSLA) Stock Soars on Earnings Beat
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Tesla Motors (Nasdaq: TSLA) Stock Soars on Earnings Beat
Updated as of 10:00 AM EST, Feb. 20, 2014:
Tesla Motors Inc. (Nasdaq: TSLA) stock opened at $215.01 today, Feb. 20, up 11% from yesterday's close of $193.64. The stock touched another all-time high of $215.21 in early trading.
TSLA stock surged 15% in after-hours trading Wednesday after beating earnings estimates and posting strong guidance figures for 2014. Here's the full story of why Tesla is soaring in 2014...
By Kyle Anderson, Associate Editor, Money Morning • @KyleAndersonMM • February 19, 2014
Tesla Motors Inc. (Nasdaq: TSLA) stock jumped 15% in after-hours trading after reporting Q4 revenue of $761 million and earnings per share (EPS) of $0.33, excluding items. Those figures were up from consensus estimates of $663 million in revenue and EPS of $0.19.
The $761 million in non-generally accepted accounting principles (GAAP) revenue was a 26% increase from Q3.
The fact that Tesla sold 6,892 of its Model S sedan was not surprising to shareholders. Company officials announced at the Detroit auto show that it had sold 6,900 Model S sedans in the fourth quarter.
Those sales are an increase of 25% from the previous quarter and beat the company's own original estimate by 20%. They are the highest sales totals in the company's history.
For the full year 2013, Tesla sold 22,477 Model S sedans and reported revenue of $2.5 billion.
While the sales and revenue figures met shareholders' approval, other factors played an even bigger role in TSLA's after-hours surge…
Guidance Figures Push Tesla (Nasdaq: TSLA) Stock Higher
For Tesla, the key for investors has always been forward guidance. And in 2014, that fact remains.
In today's letter, the company projects that it will sell 35,000 Model S sedans in 2014, for a vehicle delivery growth of 55%. Chief Executive Officer Elon Musk also expects gross margins of 28%, excluding the sales of Zero Emission Vehicle credits.
Currently, the company is producing 600 vehicles a week, but expects that number to reach 1,000 vehicles per week by the end of the year. Tesla expects to increase the number of batteries it produces in 2014, alleviating a production bottleneck.
Tesla reported that non-GAAP research and development (R&D) costs reached $58 million in Q4, an increase of 21% from Q3. Musk expects that figure to rise again in 2014, but did not mention any specific numbers.
Investors were looking closely for any details about Tesla's Model X crossover SUV, but details still remain vague. The company expects prototypes of the Model X to be on the road by the end of 2014 and to be available for customer delivery by spring 2015.
Finally, the company hinted at the development of its "Gigafactory," which will allow the company to improve on its electric battery technology. Any positive news regarding this development should send the stock higher in the short term.
Playing Tesla (Nasdaq: TSLA) Stock Moving Forward
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Joseph Kool | February 20, 2014
This stock is going to crash and burn so bad it's going to be epic. There's absolutely no justification for the $25 billion market cap on such puny sales, but Elon Musk is The pied piper of seperating silly fanboys and girls from their money. There's going to be a lot of angry idiots when this stock comes crashing back to reality. They deserve it though.
H. Craig Bradley | February 23, 2014
DEALER LOCK-OUTS
Telsa's biggest problem(s) includes competitive pricing, practicality, and state auto dealer cartels. Texas auto dealers for one have used their state courts and their considerable political influence to effectively lock-out Telsa. Something about Telsa "violating" state franchise laws.
Telsa can not compete with the other showrooms if they don't have one locally, especially when offering a new concept to the public. Rising electric utility rates and general unavailability of charging stations in public parking lots is another perhaps insurmountable obstacle. They have a limited range otherwise.
Telsa is trying to break into a business in which one of the largest domestic competitors ( GM ) is financially backed-up by the U.S. Government. If you try to compete against the Federal government or challenge them directly, you will lose. Telsa will find that under central government economic planning like we increasingly have you must "Pay to Play". No pay, no go. Just ask founder Bill Gates of Microsoft what it cost him in time and lawsuits because he refused to pay-off the Feds under the Clinton Administration. They could not put Bill Gates out-of-business but they sure did collect more money than had he first gone along peaceably.
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