Tesla Motors Inc (NASDAQ:TSLA) stock has settled after recent volatility due to a car fire incident, but the volatility may once again creep in as the date for the third quarter earnings nears. Tesla Motors will post its third quarter earnings next month or so as the company has not officially revealed the date yet.
However, gathering some insight from the previous two quarters, which were May and August, the next one could be November 4th or 8th, according to a report from Seeking Alpha by Bill Maurer.
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Higher earnings expectations
Analysts are expecting Tesla to post revenue of $533.10 million, which is an upside of 964 percent from the previous year’s corresponding quarter. On an adjusted (non GAAP) basis, analysts are expecting the profit to come in at $0.12 compared to $0.92 loss in the previous year’s quarter.
Another important metric will be number of units sold. According to Jefferies analysts, shares of Tesla will hit $210. Tesla Motors Inc (NASDAQ:TSLA) has forecast increased number of sales for the quarter and has given guidance in the range of 5,350-5,500. In the second quarter, the electronic vehicle maker sold 5,150 Tesla Model S in North America. Investors would be interested in knowing the growth in the margin, which was 22 percent non-GAAP in the last quarter.
Balance sheet items to watch for
Another metric to watch will be the changing balance sheet, which was getting weaker “with the bottom hit in that Q3 period of 2012.” However, in 2013 quarters the numbers have rebounded and it is looking much better. A key item was the capital raise in May 2013 with Tesla selling stocks and convertible debt, and CEO Elon Musk injecting another $100 million in the company. Tesla also successfully pre-paid their DOE loan. At present, Tesla Motors Inc (NASDAQ:TSLA) has more cash compared to debt, and the balance sheet appears much more stable.
Another important item is convertible notes, which carry 1.5 percent annual interest rate, and can be converted in the near future, according to the second quarter 10-Q filing.
Tesla must meet expectations
Apart from these items, Tesla Motors Inc (NASDAQ:TSLA) has many key items to watch this quarter and these metrics will decide the future course of shares.
After seeing such an upside in Tesla Motors Inc (NASDAQ:TSLA)’s stock, investors would expect a “more than perfect” report. However, if Tesla fails to stand up to expectations then, according to the author, its stock rally might be disrupted. There are chances that the earnings report could turn into “buy the rumor, sell the news” event, which requires Tesla to take care of all aspects.