Tesla Inc TSLA shares are headed into first-quarter earnings at all-time highs above $320, but investors anticipating the launch of the Model 3 later this year should keep expectations in check. According to Cowen analyst Jeffrey Osborne, market euphoria for Tesla stock will likely only last until the Model 3 is launched.
“We see likely ramp delays in Model 3, greater transparency about true capital needs, and margin pressure dampening enthusiasm over time; however, until the Model 3 actually is launched we see the stock continuing to work as right now investors continue to buy into the Model 3/low cost battery story,” Osborne explained.
What To Look For
In the near term, Osborne will be looking for the following four details on Tesla’s Q1 earnings call:
- Any indication of how Tesla plans to raise capital for an estimated $3.6 billion per year in 2017 and 2018 capex.
- Any details on the Model 3 production ramp, given reports that Kuka AG robots are being installed in Fremont.
- Order trends for Model S that could provide clarity on possible saturation/cannibalization.
- The possibility of full-year Model 3 guidance, although Cowen predicts the company will not issue any such guidance.
In addition, Osborne would like to see an update on the integration of SolarCity and plans for the company moving forward.
While Osborne acknowledged the unique vision of CEO Elon Musk, he said…
Click here to continue reading
Want to learn more about how to profit off the stock market? Or maybe you just want to be able to look sophisticated in front of your coworkers when they ask you what you are reading on your Kindle, and you’d prefer to tell them “Oh, I’m just reading a book about stock market analysis,” rather than the usual “Oh, I’m just looking at pics of my ex-girlfriend on Facebook.” For these reasons and more, check out my book, Beating Wall Street with Common Sense. I don’t have a degree in finance; I have a degree in neuroscience. You don’t have to predict what stocks will do if you can predict what traders will do and be one step ahead of them. I made a 400% return in the stock market over five years using only basic principles of psychology and common sense. Beating Wall Street with Common Sense is now available on Amazon, and tradingcommonsense.com is always available on your local internet!
