Tesla's 'Beat' Is No Beat If You Were Paying Attention - $500 Per Share Path Still Intact

Feb.20.14 | About: Tesla Motors (TSLA)

Tesla (NASDAQ:TSLA) reported fourth quarter earnings results on February 19 with results that shocked the street. Non-GAAP revenue came in at $761 million vs. expectations of $677 million. Earnings per share came in at $0.33 vs. expectations of $0.21.

Was it because Tesla "surprised" or was it because analysts were asleep at the wheel? Analysts were asleep.

In my article published on February 9 entitled Tesla: 2 Events Pave The Way Closer To $500 Per Share, I outlined what was coming as the clues were there for anybody who was paying attention:

I contended then and reiterate now that analysts are underestimating the figures. Tesla has already revealed that it delivered 6,900 vehicles and had previously forecasted the average revenue per vehicle would be similar to the third quarter. That puts the revenue at $759 million. Since that time one analyst has raised his estimate to $758.1 million which is almost exactly even with my estimate. The average is still $663.2 million according to Yahoo so expect to see either that number rise by earnings date or for Tesla to blow away that number. The average earnings estimate is now $0.19 and one analyst has it as high as $0.30. Based on the revenue estimates, the $0.30 one is probably the one closer to what Tesla will report.

My revenue figure was understated by just $2 million and my earnings per share by $0.03.

What does this mean going forward? Pay attention! Tesla has a habit of dropping enough clues that even the smallest of retail investors armed with a simple calculator can pick up on and figure out the results well ahead of the street. For now, you can expect revenue to be up another 10% for quarter one based on more than 10% increase production compared to the fourth quarter. Operating expenses are expected to grow by 15% as well as SG&A, so if you do a little back-of-the-napkin math, expect for now to see earnings per share of something similar to the $0.33 of this quarter.

As I type this, analysts expect $0.26 per share. Look for analysts to raise their estimates. That is, if they decide to wake up from their slumber. Otherwise get ready for another "beat" of expectations in the first quarter.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.