Reuters - Video

EDITION: U.S. | U.K. | IN

Technology

Tesla stock falls despite earnings beat

Wednesday, May 07, 2014 - 02:13

May 07 - Elon Musk's luxury electric car maker reported earnings that were better-than-forecasts, but investors fled on a a disappointing second quarter outlook. Bobbi Rebell reports.

▲ Hide Transcript

View Transcript

Tesla took it on the chin when it reported earnings. Better-than-expected on the top and bottom line. But its second quarter outlook kept the stock going in reverse- adding to recent pain. S&P Capital IQ's Efraim Levy has a neutral rating on Tesla: SOUNDBITE: EFRAIM LEVY, EQUITY ANALYST, S&P CAPITAL IQ (ENGLISH) SAYING: "I think this is a stock that has an extreme valuation. The question is- is it warranted? And that is the battle between the bulls and the bears. We are cautious about it . Going into this we had a $200 target price which is right where it had closed. And you know, it's something that with momentum stocks you have to be very careful. It can go very quickly one way or the other." But the price may soon be right according to Theodore O'Neill of Litchfield Hills Research: SOUNDBITE: THEODORE O'NEILL, MANAGING DIRECTOR, LITCHFIELD HILLS RESEARCH (ENGLISH) SAYING: "I think this is a buy and I'd use any dips here as buying opportunities. I see it's weak after hours. I don't see anything in this report that is negative from a business perspective." As far as the fundamentals, there is a lot for investors to like. Plans for its lithium-ion battery plant are on track- though no word on the location. They did confirm Panasonic will be the only company producing in the Gigafactory. And sales numbers for the Model S were on track- and they are boosting production on the sedan. But Levy points out the road is still bumpy: SOUNDBITE: EFRAIM LEVY, EQUITY ANALYST, S&P CAPITAL IQ (ENGLISH) SAYING: "The big risks well one we mentioned is technology related to getting the battery costs down and succeeding with the factory as well as the new model. I guess one other positive I saw was they seemed to be moving ahead in developing that Model X- the mass model. And you know, that is the key to, as I mentioned to success going forward. There is also risk with competition. BMW and others are having electronic vehicles also that are similar to what Tesla is offering and BMW is a luxury competitor so if there is another alternative they could lose some sales that way." Tesla added it's planning to expand in China as fast as possible- and that it could be one of their largest markets within a few years.

Press CTRL+C (Windows), CMD+C (Mac), or long-press the URL below on your mobile device to copy the code

Tesla stock falls despite earnings beat

Wednesday, May 07, 2014 - 02:13

Top News »

Investing 201 »

Arian Foster = BlackBerry? Arian Foster = BlackBerry?

Fri, Oct 25, 2013 - (3:16)

Don’t miss these red flags for IPOs Don’t miss these red flags for IPOs

Thu, Oct 10, 2013 - (2:34)

Copycat currency trading Copycat currency trading

Wed, Oct 02, 2013 - (2:28)

When to dump a winner When to dump a winner

Tue, Sep 24, 2013 - (1:55)

Where gold might again attract Jim Rogers Where gold might again attract Jim Rogers

Thu, Sep 19, 2013 - (2:05)

Why savings interest rates won't budge Why savings interest rates won't budge

Fri, Sep 13, 2013 - (2:09)

Buy local? ETFs try the trend Buy local? ETFs try the trend

Thu, Sep 05, 2013 - (2:42)

The better bond funds The better bond funds

Wed, Aug 07, 2013 - (2:40)

Best bargain in 40 years? European stocks Best bargain in 40 years? European stocks

Thu, Aug 01, 2013 - (2:24)

Invest like an activist Invest like an activist

Fri, Jul 26, 2013 - (2:49)

Money Clip »

3 things to do before disaster strikes 3 things to do before disaster strikes

Wed, Sep 18, 2013 - (1:39)

Your must-do money list Your must-do money list

Wed, Sep 11, 2013 - (1:24)

The worst "best" financial advice The worst "best" financial advice

Wed, Sep 04, 2013 - (1:42)

Forget gold: The case for REITs Forget gold: The case for REITs

Fri, Apr 26, 2013 - (1:19)

3 rules for buying a house now 3 rules for buying a house now

Thu, Apr 18, 2013 - (1:39)

“Stalking” your dream home - Money Clip “Stalking” your dream home - Money Clip

Wed, Mar 27, 2013 - (2:50)

3 hidden tax deductions - Money Clip 3 hidden tax deductions - Money Clip

Thu, Mar 21, 2013 - (1:33)

Moving Pictures »

Still missing – MH370 Still missing – MH370

Fri, Sep 05, 2014 - (2:05)

Images of August Images of August

Fri, Aug 29, 2014 - (1:00)

Burning Together Burning Together

Mon, Sep 01, 2014 - (2:23)

Mending dolls, teddies and hearts Mending dolls, teddies and hearts

Fri, Aug 22, 2014 - (3:12)

"Old timers" sail the Chesapeake Bay "Old timers" sail the Chesapeake Bay

Mon, Aug 11, 2014 - (2:27)

Burned memories Burned memories

Fri, Aug 08, 2014 - (3:02)

Images of July Images of July

Thu, Jul 31, 2014 - (1:20)

World Cup: passion on the pitch World Cup: passion on the pitch

Fri, Jul 11, 2014 - (1:00)

A refugee in America gives back A refugee in America gives back

Thu, Jul 03, 2014 - (3:25)

A long search for refuge A long search for refuge

Fri, Jun 20, 2014 - (3:04)

Reuters Investigates »

Re-homing victim: "I could have been dead" Re-homing victim: "I could have been dead"

Wed, Feb 19, 2014 - (8:24)

Cops and loggers in the Amazon rainforest Cops and loggers in the Amazon rainforest

Fri, Jan 10, 2014 - (4:01)

"Passed around like a dog" "Passed around like a dog"

Thu, Aug 29, 2013 - (6:32)

Adopted, then abandoned online Adopted, then abandoned online

Thu, Aug 29, 2013 - (13:21)

How the DEA keeps its secrets secret How the DEA keeps its secrets secret

Mon, Aug 05, 2013 - (1:36)

How education lost its role as the great equalizer - Reuters Investigates How education lost its role as the great...

Mon, Dec 17, 2012 - (7:52)

Jihad Jane: From abused child to American jihadist - Reuters Investigates Jihad Jane: From abused child to American...

Sat, Dec 08, 2012 - (10:01)

Jihad Jane: The order to kill - Reuters Investigates Jihad Jane: The order to kill - Reuters...

Sun, Dec 09, 2012 - (10:39)