Tesla Earnings Report Will Put Focus On Model 3 Challenges


Tesla reported first-quarter earnings after the market close on Wednesday, at a very crucial and critical time for the electric-car company.

The main focus will be, on the pace and path of the Model 3 production. Tesla’s lower priced model, caused capital spending and shares to rise and drop tremendously. It fluctuated up and down by a lot. The Model 3 will be taking up time and money for the company, but the goal is to make its Model 3 better.

Tesla has reported that the company will work around-the clock, out of its auto plant in Fremont, California on production. A Bloomberg report, stated through a leaked email from Chief Executive Elon Musk, it is trying to ramp up the Model 3, to 6,000 a week. The Model 3 has a lot of potential, and the company is focusing on making it as good as it can possibly get.

KeyBanc Capital Markets analyst Brad Erickson, stated in a note to clients that, “Even in spite of the CEO’s leaked email detailing near-term production ramp, we don’t yet have clear communication on where the company could go beyond the 5,000-plus per week range in the second half of the year.” Brad Erickson also had stated that, “Cash burn and trajectory of Model 3 production ramp remain the most likely impediment to the stock moving higher.”

Wall Street expects an increase in revenue of $3.27 billion. An 18% increase from the year-ago period. Zacks Investment Research polled analysts, see a loss of $3.37 per share.

Tesla Production Issues

In recent weeks, market commentary has focused on Tesla’s production funding and issues. Jefferies analyst Philippe Houchois, wrote in a report, “With Model 3 visible for months in stores nationwide, gross orders should be a telling indicator of underlying demand.”
Philippe Houchois has a price target of 250, and a hold rating. The Model 3 should be worth the time, energy, and money into making it better, because it seems to be popular and can potentially bring in lots of income.

RBC Capital Markets analyst Joseph Spak has a sector perform rating on Tesla and price target of 305. Joseph Spak wrote in his note, that, “Tesla is difficult to value and prone to sentiment and momentum.” Spak also had written that, “Next trading move could be higher as one thing that recent spate of negative news may have done is lower expectations.”

During morning trading on the stock market today, stocks were down 0.1% , near 300. Model Y could be starting limited production in late 2019, and the Tesla-Semi also might be getting some new updates for next year. The Tesla-Semi could also be a great potential for extra income, and the updates will surely provide the chance to do this.

Tesla was sued on Tuesday, by electric-hydrogen truck startup Nikola Motor, for more then $2 billion dollars. They are claiming patent infringement over the design of its big-rig truck. This is a huge hit on Tesla, and could mean big problems for them. This might cause a huge negative affect on everything that Tesla has been working forward to improve.


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