Tesla Motors (TSLA): Buy, Sell or Hold?

By Jun 13, 2013, 7:15 AM Author's Blog  

Tesla Motors‘ (TSLA) price target raised to $118 from $70 at Robert W. Baird drew heated sentiment from the CNBC’s “Fast Money” traders Wednesday.

OptionMonster’s Jon Najarian was against a potential upside of 21% from the company’s current price.

“I don’t know why you wouldn’t love this stock,” he said. “Look, in May the sales were down, the car sales were down about 15 percent. What’s wrong with that? Or a 95 forward P/E [Tesla's stock trades at more than 550x projections for earnings this fiscal year]. Or the fact this they lose about 30 percent on every car. What’s not to like?”

Najarian said that the one good number was in the short interest. Shorters have pushed the company toward the biggest rally in the Russell 1000 Index this year.

“Short interest is huge. It’s about 24 percent, right around that range….You look at the volumes of trade here, too, 37 million shares in one day,” he said. “I believe there were 14 out of the 20 days in May that this thing traded north of 15 million.”

Stuart Frankel’s Steve Grasso argued that Elon Musk’s ability to glamorize electric cars has made Tesla’s stock hot.

Shares of the California-based manufacturer of electric vehicles gained 3.45 percent to close at $97.73 on Wednesday. TSLA has rallied 193 percent year-to-date, pushing its PPS to about 73x Wall Street’s forecasts for its 2014 profit.

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2 Comments

  1. Arturo says:

    CURVACEOUS TESLA GIMMICKS

    Curvaceous silhouette styling was glorifed, with the introduction of the Toyota, Camry (1991-1996). Tesla investors must consider the shape of today’s Tesla Model S, and judge whether this car is already dated.

    Other designs moved away from curvaceous, by taking on more deeply sculptured cues. Consider the new BMW concepts, and the Cadillac ELR 2014.

    Tesla Model S value could plummet, if the company is forced to freshen the EVm sooner than owners would car to see. Tesla can lose the carp grille gimmick, sooner than later!

    Another gimmick, is the claim that all Tesla owners will have free power. Owners should calculate, how much of the EV range will be utilized, while reaching a Supercharger, now and in the future. Electric charge, originating from a coal fired power plant, is not free.

    VALUE DETOUR: STYLING & GIMMICKS

  2. otari99 says:

    I keep hearing the same story over and over again from the skeptics (and those who missed the boat). I was in an $35 a few weeks back and still riding this wave.

    In any case, the technology is still advancing; you gotta’ start somewhere.

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