Tesla Motors Inc (NASDAQ:TSLA)’s latest earnings report has sparked plenty of mixed views from analysts. Analysts at Ascendiant Capital Markets see more growth for Tesla from selling batteries, while Morgan Stanley analysts think the automaker’s stock won’t drop under the $200 level any time soon. Additionally, Barclays analysts have drawn some comparisons between Tesla and General Motors Company (NYSE:GM).
In their report dated Nov. 5, 2014, Morgan Stanley analyst Adam Jonas and his team note that most of the bumps in Tesla’s latest earnings report were expected. They added that if the automaker’s shares didn’t drop below $200 in the next few days, which they haven’t, that they don’t think they will “for a while.”
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The analysts said that many of the investors they have spoken with about Tesla Motors “seem convinced” of the company’s long term potential. However, they want to see a 1 on the front of Tesla’s share price before they dive in. They believe this is the case but it doesn’t seem like the “nervousness” is as bad as some thought.
Looking on the bright side
In his report also dated Nov. 5, 2015, Ascendiant Capital Markets analyst Theodore O’Neill highlighted all of the positive in Tesla’s earnings report. He thinks the automaker is taking share from luxury cars like the Porsche Panamera, the BMW 7 series, the BMW X6 and X5 and the Audi A7. He thinks Tesla may also be taking market share from Infiniti, although he notes that that brand is also having other problems.
He thinks it doesn’t matter that Tesla Motors Inc (NASDAQ:TSLA) is having manufacturing problems and notes that it does take a lot to manufacture a quality automobile. He points out that the automaker’s factor is sold out and that as long as it can’t meet demand, then it doesn’t matter how many cars it sells each month. Tesla management declined to provide data about monthly sales.
The analyst also sees future growth for Tesla Motors Inc (NASDAQ:TSLA) in making batteries through its gigafactory. He thinks that the batteries will be able to be used as energy storage devices for homes with solar panels even after the battery packs for the cars come to the end of their life. He also points out that selling used batteries enables Tesla to sell the batteries it produces twice, once in its cars and a second time for homes when those batteries get recycled.
Tesla compared to GM
In their report dated Nov. 6, 2014, Barclays analyst Brian Johnson and his team said Tesla Motors Inc (NASDAQ:TSLA) right now reminds them of GM in the mid-2000s. First, they note that the automaker made a headline earnings per share beat that was based on “below the line items.” In Tesla’s case, it was revenue from the sale of emissions credits.
Second, they say that like GM, Tesla had a sales push toward the end of the quarter, selling 907 cars in a single day. Third, the automaker backed off its previous guidance for deliveries for the full year, lowering it from 35,000 to 33,000 cars. Fourth, Tesla’s next quarter earnings per share guidance was below consensus estimates, and fourth, the automaker is depending on lease deals to meet sales goals.
Fifth, the electric vehicle maker has delayed the launch of the Model X, just like GM delayed the launch of some of its cars. And sixth, they say the “near-term rough edges [are] wrapped up with a rosy outlook for next year.”