What Analysts Are Saying About Tesla After Earnings

Chris Lange

When Tesla Inc. (NASDAQ: TSLA) released its most recent earnings report late on Wednesday, investors were very impressed with the report, though analysts seemed skeptical. Despite this multibillion-dollar company posting a loss, CEO Elon Musk still managed to wow Wall Street. Although, it seems that everyone is focused on the future.

24/7 Wall St. has included some highlights from the earnings report, as well as what a few analysts are saying after the fact.

The electric auto manufacturer posted a net loss of $1.33 per share on $2.79 billion in revenue, compared with consensus estimates from Thomson Reuters that called for a net loss of $1.80 per share and revenue of $2.55 billion. The same period from last year reportedly had a net loss of $1.61 per share and $1.27 billion in revenue.

The near-doubling of automotive revenues, from $1.18 billion in the second quarter of last year to $2.29 billion this year, was the result of 53% more deliveries and fewer vehicles sold with residual risk from leases. Sequentially, revenues were flat, but vehicles subject to lease accounting fell from 26% to 19% of sales.

The carmaker already had announced that it delivered slightly more than 22,000 vehicles in the quarter. Another 3,500 vehicles were in transit to customers and won’t be counted as delivered until the third quarter. All told, Tesla said it produced 25,708 vehicles in the second quarter. For the first half of the year, Tesla has delivered 47,777 new Model S and Model X vehicles.

Looking ahead, Tesla said it expects an increase in deliveries of Model S and Model X vehicles in the second half of the year. Combined non-GAAP gross margin for Model S and Model X in the third quarter will decline slightly from the second quarter total of 25%, driven primarily by mix shift. The company expects Model 3 non-GAAP gross margin to be positive in the fourth quarter.

After the earnings were released a few analysts weighed in on Tesla:

  • Merrill Lynch maintained its Sell rating and lowered its price target to $155 from $165.
  • JPMorgan has an Underweight rating with a $200 price target.
  • RBC has a Sector Perform rating with a $345 price target.
  • Piper Jaffray has a Buy rating with a $386 price target.
  • Berenberg Bank has a Buy rating.

Shares of Tesla were last seen up about 7% at $347.78 on Thursday, with a consensus analyst price target of $303.39 and a 52-week range of $178.19 to $386.99.