Tesla (TSLA) Not as Bad as Expected but In Limbo with No Catalysts – Baird

November 4, 2015 6:56 AM EST
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Price: $774.39 --0%

Rating Summary:
    24 Buy, 21 Hold, 12 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 6 | Down: 6 | New: 23
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Baird analyst, Ben Kallo, published an earnings recap on Tesla (NASDAQ: TSLA) which highlighted slow but building momentum. The stock had sold off so aggressively that a small reduction in estimates was baked in and the revenue upside, rosy outlook and management additions increased investors comfort with the name.

TSLA reported non-GAAP revenue of $1,244M vs. consensus of $1,262.9M. Non-GAAP net income was ($75M) and non-GAAP EPS was ($0.58) vs. consensus estimates of ($65.3M) and ($0.53), respectively. Total gross margin was 25.1%, exceeding consensus estimates of 24.1%.

TSLA tightened its FY:15 delivery guidance to 50k-52k vehicles vs. previous guidance of 50k-55k. This was better than whisper numbers of 48k-52k.

TSLA continues to ramp Model S and X production but with Q4 deliveries expected to be 17k vehicles, expectations are high. If part shortages become an issue with the Model X, this could be a very high hurdle.

Quarterly Model S demand increased ~50% y/y, and TSLA is gaining momentum in China.

Model X Signature reservations are converting to firm production orders at a better conversion ratio than the S.

TSLA will begin cell production at the gigafactory by the end of 2016.

TSLA announced the hiring of Jason Wheeler as CFO (previously at Google) and Jon McNeill as President of Sales and Service (previously at Enservio).

The analyst maintained his Neutral rating and $282 PT.

For an analyst ratings summary and ratings history on Tesla Motors click here. For more ratings news on Tesla Motors click here.

Shares of Tesla Motors closed at $208.35 yesterday.

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Robert W Baird, Tesla, Earnings, Ben Kallo