Buy Tesla (TSLA) on Any Weakness; Global Equities Sees Fundamentals as Intact and Strong
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Global Equities Research is defending Tesla Motors (Nasdaq: TSLA) following Monday's sell-off, saying investors should buy the stock on any weakness. The firm rates Tesla at Overweight with a price target of $385.
Analyst Trip Chowdhry noted that Tesla's fundamentals are still intact and strong. He made the following points:
Global Equities Research is defending Tesla Motors (Nasdaq: TSLA) following Monday's sell-off, saying investors should buy the stock on any weakness. The firm rates Tesla at Overweight with a price target of $385.
Analyst Trip Chowdhry noted that Tesla's fundamentals are still intact and strong. He made the following points:
- Within next 3 months, Tesla is expected to launch 4-wheel drive Tesla Model S. This expands Tesla Model S customer base beyond the Southern Belt of USA
- Our research indicates that most of the Tesla Model S sales so far has occurred in the southern belt of USA
- The current version of Tesla Model S is rear wheel drive, and is somewhat less suited for snow
- Hence, about 83% of Tesla Model S sales have happened in the Southern States of USA, where it hardly snows, with sales of Model S in California being the highest, followed by Georgia and then Texas
- About 17% of Tesla Model S sales have happened in the Northern States of USA, with Sales of Model S in Illinois being the highest, followed by New York and then Washington
- 4-wheel Drive Model S is a significant revenue catalyst for Tesla and will expand the market for Tesla Model S in both Northern Belt of USA, as well as in Europe, where it snows heavily
- Our research indicates that most of the Tesla Model S sales so far has occurred in the southern belt of USA
- Within next 3 months, Tesla is expected to include Driver Assist features into Tesla Model S
- Within next 3 months, Tesla is expected to make available the 400 mile range Battery Pack for Tesla Roadster. This launch should be considered more of a test bed, as it will likely set the tone for the expected range of future Tesla vehicles
- It is widely expected that probably there are potentially two more companies interested in investing in the Tesla Giga Factory, with likely candidates being:
- Sanyo
- LG Chem
- Over the next 6 to 12 months Tesla will be giving rides to potential customers on Model X Alpha versions.
- Test drives will be scheduled in Model X Beta's which will likely be available after March'2015
- Our search indicates that interest in Model X is extremely strong, and both Alpha release of Model X as well as the Beta release of Model X will likely spur Model X bookings
- Probably around November of 2015, i.e. about 12 months from now, Tesla is going to show the mass production vehicle Tesla Model 3. At Refuel conference, a few people claimed to have seen the Clay Model of Model 3, and they said the shape of Model 3 is "Unbelievable"
For an analyst ratings summary and ratings history on Tesla Motors click here. For more ratings news on Tesla Motors click here.
Tesla Motors closed at $253.86 yesterday.
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