Why Tesla Motors’ (TSLA) Forthcoming Model 3 WIll Take The Company Mainstream

Share
  •  
  •  
  •  
  •  
  •  
  •  
  •  
  •  

It’s been a rough road for Tesla Motors Inc (NASDAQ:TSLA) these last few months, but after releasing earnings yesterday after the bell, there is a sense that we may be at or near a bottom over the short term. The stock has literally been cut in half over the last seven months, and the start to 2016 has been a horrid one for shareholders.

With that said, the future for Tesla Motors Inc (NASDAQ:TSLA) looks bright if you are able to see over he horizon. Not only will their Model X vehicles begin rolling out in larger quantities throughout the year, but the next car on the horizon, the Model 3 is the one which could certainly take the company mainstream. The Model 3 is expected to be priced at around $35,000. This is a fairly affordable price for an EV. What makes the price even more attractive are the government incentives to purchase one. The incentive? $7,500!

This means that the true cost of the Model 3 will be just $27,500; a price which falls near the low end of the pricing spectrum for a new vehicle. While incentives will not last forever, they should last long enough to bring in hundreds of thousands of sales, just in time for Tesla’s Giagafactory to really ramp up. What’s after the Model 3? That’s anyone’s guess, but it will more than likely be a much more profitable car for the company.

Shares of Tesla Motors Inc (NASDAQ:TSLA) are trading up $6.93 or 4.82% in the pre-market this morning. The stock closed at $143.67 during the last trading session. It is down 43.65% since July 8, 2015 and is downtrending. It has underperformed the S&P500 by 34.78%.

From a total of 16 analysts covering Tesla Motors Inc (NASDAQ:TSLA) stock, 8 rate it a “Buy”, 3 a “Sell”, and 5 a “Hold”. This means that 50% of the ratings are positive. The highest target price is $465 while the lowest target price is $180. The mean of all analyst targets is $289.65 which is 101.61% above today’s ($143.67) stock price. Tesla Motors Inc was the topic of 30 analyst reports since July 21, 2015 according to the firm StockzIntelligence Inc. JMP Securities initiated shares on December 14 with a “Market Perform” rating. Barclays Capital downgraded shares to a”Underweight” rating and a $180 target share price in their report from an October 9. Evercore maintained TSLA stock in a recent report from November 4 with a “Buy” rating. Robert W. Baird downgraded the rating on October 7. Robert W. Baird has a “Neutral” rating and a $282 price target on shares. Finally, S&P Research upgraded the stock to a “Hold” rating in a report they issued on an October 13.

The institutional sentiment increased to 1.29 in Q2 2015. It’s up 0.01, from 1.28 in 2015Q2. The ratio improved, as 84 funds sold all their Tesla Motors Inc shares they owned while 122 reduced their positions. 66 funds bought stakes while 199 increased their total positions. Institutions now own 76.22 million shares which is 1.63% less than the previous share count of 77.48 million in 2015Q2.

J&P(China)Capital Management Co.Ltd holds 50.38% of its total portfolio in Tesla Motors Inc, equating to 975,058 shares. Andor Capital Management L.L.C. owns 1.00 million shares representing 39.05% of their total US portfolio. Moreover, Zevenbergen Capital Investments Llc has 6.58% of their total portfolio invested in the company, equating to 618,255 shares. The New York-based Long Oar Global Investors Llc has a total of 5.74% of their portfolio invested in the stock. Hhr Asset Management Llc, a New Jersey-based fund reported 488,021 shares owned.

Since April 16, 2015, the stock had 0 insider purchases, and 5 sales for a total of $12.70 million in net activity. Straubel Jeffrey B sold 10,000 shares worth $2.18 million. Ehrenpreis Ira Matthew sold 16,698 shares worth $4.26M. Ahuja Deepak sold 5,000 shares worth $1.29M. Guillen Jerome M sold 1,500 shares worth $373,291. The insider Reichow Gregory sold 10,000 shares worth $2.40M.

Tesla Motors, Inc. is a United States company, which designs, develops, makes and sells electric vehicles, electric vehicle powertrain components and stationary energy storage systems. The company has a market cap of $18.23 billion. The Firm sells and produces a vehicle under the name Model S, which is a fully electric, four-door, five-adult passenger sedan. It currently has negative earnings. In addition to developing its own vehicles, it develops, sells, and services full electric powertrain systems and components to other automobile manufacturers.