Oppenheimer Updates Model on Tesla (TSLA) Ahead of Anticipated Reporting Changes
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Oppenheimer analyst Colin Rusch updated his model on Tesla Motors (NASDAQ: TSLA) on anticipated reporting changes ahead of Q3 earnings on 10/26/16. The firm maintained a Perform rating.
Rusch commented, "Given the potential confusion around TSLA’s anticipated reporting changes, we are publishing an updated model to help investors navigate these adjustments. The critical change in proforma revenue is the recognition of lease revenue not total vehicle value. Due to high percentage of deferred revenue (~35%), this change also materially changes EPS. We expect cash flow estimates to remain intact. We also believe the new reporting structure highlights the importance of TSLA’s lease partners and risks around TSLA’s used vehicle market whether it is older vehicles cannibalizing new sales or the brisk pace of innovation limiting interest in older vehicles. While used Tesla’s have held value well to date, we view the end of lease vehicle strategy as a critical variable for future cash needs."
Shares of Tesla Motors closed at $202.76 yesterday.
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