Baird Looks Through Tesla's (TSLA) 1Q Delivery Miss (TSLA)

Baird analyst, Ben Kallo, reiterated his Outperform rating and $300 PT on shares of Tesla Motors (NASDAQ: TSLA) as the Model X production should overshadow the 1Q delivery miss. Total deliveries were slightly below estimates due to issues with the sourcing of Model X parts. That said, this issue was resolved, Model X production is now higher than expected, and Q1 Model X deliveries doubled our estimate. Additionally, Model S orders remain strong (up 45% y/y) and full-year guidance was reaffirmed.

TSLA announced it delivered 14.82k vehicles in Q1:16 (including 12.42k Model S and 2.4k Model X), below its target of ~16k and our estimate of ~16k. Production/deliveries were impacted by Model X part shortages, although these issues have been resolved. Additionally, TSLA is focused on ensuring no Model III part issues occur to enable a smooth Model III launch when production begins in 2017.

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Shares of Tesla Motors closed at $246.99 yesterday.

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