Seeking Alpha

Deutsche raises Tesla PT to $200 from $160, shares +1% AH

  • Analyst Dan Galves: "Based on conversations with mgmt and monitoring information available on Tesla (TSLA) owners’ blogs, we believe that the company is on-track to modestly outperform Q3 margin expectations, that demand has continued to grow in the US and Europe."
  • Galves also thinks Model S demand continues to grow in spite of recent option price hikes, and points out 22% of the free float still remains shorted.
  • Morgan Stanley came out with a bullish note yesterday.
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Comments (36)
  • speedofov
    , contributor
    Comments (91) | Send Message
     
    The analyst must be ignoring all the negative articles posted to SA.
    18 Sep 2013, 06:28 PM Reply Like
  • Jacob Steinberg
    , contributor
    Comments (814) | Send Message
     
    Analysts are nothing but trend followers. When a stock goes up, they upgrade, when a stock goes down, they downgrade. Analysts were racing with each other in downgrading Nokia when it was trading for $2 and they are now racing with each other in upgrading the company at prices above $6.
    18 Sep 2013, 06:52 PM Reply Like
  • Michael Bryant
    , contributor
    Comments (5822) | Send Message
     
    So why do we still listen to analysts?
    19 Sep 2013, 10:28 AM Reply Like
  • Cassina Tarsia
    , contributor
    Comments (666) | Send Message
     
    Speedofov ... Oh ... you are listening to those negative articles? Surprise, surprise!
    19 Sep 2013, 12:07 PM Reply Like
  • Cassina Tarsia
    , contributor
    Comments (666) | Send Message
     
    By the way, here is something that just came over Twitter - take a look - Tesla just patented a 400 mile duel battery pack ... Lithium Ion and Aluminum Air. Take a look - http://bit.ly/18Eoxv5
    19 Sep 2013, 03:46 PM Reply Like
  • Ron Reed
    , contributor
    Comments (319) | Send Message
     
    And the rising long term debt and cash burn.
    18 Sep 2013, 06:33 PM Reply Like
  • Energysystems
    , contributor
    Comments (1564) | Send Message
     
    And the fact that margin expectations are absolutely ludicrous compared to every other car manufacturer.
    18 Sep 2013, 06:33 PM Reply Like
  • Simchad
    , contributor
    Comments (92) | Send Message
     
    But he mention 22% of the float is short. I expect some major pain over the next few days.
    18 Sep 2013, 06:37 PM Reply Like
  • Jacob Steinberg
    , contributor
    Comments (814) | Send Message
     
    I wonder how up-to-date that number is. If it's up to date, that's a high number.
    18 Sep 2013, 06:53 PM Reply Like
  • Michael Bryant
    , contributor
    Comments (5822) | Send Message
     
    One reason why I don't like shorting a stock.
    19 Sep 2013, 10:30 AM Reply Like
  • Stephen J Melnykevich
    , contributor
    Comments (1312) | Send Message
     
    Speed, Ron and Energy you are all exactly right.

     

    Which is why this stock will probably break $200 shortly and continue on up.

     

    Apple with it's low long term debt, boundless cash and world leading margins will continue to fall.
    18 Sep 2013, 06:38 PM Reply Like
  • murdock101
    , contributor
    Comments (21) | Send Message
     
    exactly! so what's the current difference between Apple and Tesla? Apple is suddenly making products that are uninspiring and no more innovative than it's competition. Tesla is making the best car most auto experts have ever seen....and many think their cars will continue to lead the industry in innovation and sexiness. Look at how much this one key difference affects valuation these days. It is ALL about making a trend-setting, quality product with a social network buzz.....nothing else matters much in current markets TSLA and AAPL are very clear evidence of this. Among the hipsters and trend setters Apple is a has been....Tesla is the future.
    19 Sep 2013, 10:17 AM Reply Like
  • speedofov
    , contributor
    Comments (91) | Send Message
     
    It seems to me that this boils-down to two different views:
    1. Analysis using the traditional financial analytic tools and showing the stock to be worth much less than the current price (or)
    2. Those who see Tesla at the front of a movement to change the personal transportation world.
    If it's #1 then the stock will plummet at some time in the future. If it's #2 then it's cheap by any standard.
    Each can make the case but nobody knows, for sure. Only time will tell.
    18 Sep 2013, 06:41 PM Reply Like
  • Jacob Steinberg
    , contributor
    Comments (814) | Send Message
     
    This is why I'm considering playing a straddle with Tesla soon. If Tesla is successful, it will go to $400, if it fails, it will go below $40. There is hardly any in-between for Tesla.
    18 Sep 2013, 06:54 PM Reply Like
  • ursf
    , contributor
    Comments (172) | Send Message
     
    Waiting for J.P.'s comments, also in regards to Tesla's apparent ongoing R&D on battery technology, as we have not yet seen his updated expert take on the hybrid battery announcement a few days ago. It looks like Tesla is moving faster than research can keep up with them. I hope we will receive this input some time soon.
    18 Sep 2013, 06:45 PM Reply Like
  • chfp
    , contributor
    Comments (594) | Send Message
     
    Don't forget Miro who's always good for a chuckle.
    18 Sep 2013, 06:47 PM Reply Like
  • Dan Fichana
    , contributor
    Comments (1921) | Send Message
     
    I tend to do the opposite of what J.P. says, except im the case of A123, but that was blantantly obvious to short even without any pundits. I feel sorry for the people who followed his advice to short TSLA and go long exide though.... Hope they had stop losses in place.

     

    With A123: i say it was obvious because:
    A123 supplied a product that contained their batteries fail miserably in a public review and then find out that the reason the end product failed was because a123 put out a faulty batteries- im talking about the CR fisker fiasco), plus they didnt get the Volt contract, plus the sub 100 mile EVs are selling much less than expected.
    19 Sep 2013, 10:41 AM Reply Like
  • Miro Kefurt
    , contributor
    Comments (692) | Send Message
     
    @chfp
    Glad to know someone reads my comments, especially if they are entertaining.
    But sorry, really nothing much to add, if the oracle predicts $200, than probably it will happen, if for no other reason, then because it was predicted.

     

    It will be after all a great news for those who bought at $170, at least they will have someone to sell (TSLA) at a profit.

     

    I have already sold all my shares (only had few, few months ago), no interest any more in extra speculation.

     

    After my deep probing into the Company, I have also lost all interest in owning MODEL S, at any price (originally was willing to lease for 2 years - only because of my frequent travel from Los Angels to Las Vegas).
    The travel will continue for next few years, but it will NOT be in TESLA S, the cost of tires alone offsets any illusion of fuel savings.
    18 Sep 2013, 07:26 PM Reply Like
  • Leigh Christie
    , contributor
    Comments (76) | Send Message
     
    what $136 each is too much for you Miro? I'm confused.
    18 Sep 2013, 07:41 PM Reply Like
  • aaronw2
    , contributor
    Comments (215) | Send Message
     
    Actually tires are not *that* expensive, and the supercharger will more than make up for the extra cost of the tires relatively quickly especially with the 19" wheels. It's not hard to price tires on Tirerack.com after all.
    18 Sep 2013, 09:25 PM Reply Like
  • lalsai
    , contributor
    Comments (21) | Send Message
     
    Four Tires for the Jeep Grand Cherokee cost more than four tires for the Sedan.
    19 Sep 2013, 09:19 AM Reply Like
  • Rik1381
    , contributor
    Comments (1420) | Send Message
     
    Miro, I measured the tread depth for the OEM Goodyear 245/45R19 tires on my Model S 85 with a Storm 3S401 digital tread depth gauge.

     

    With 6300 miles, the front tires have undetectable wear. The rear tires have lost about 1/64" of tread depth, detectable but very little wear. There's no uneven wear across the width of any tire. Since they can lose 6/32" of depth before replacement, with rotation they should last more than 60K miles. They cost $136 each at Tirerack. If they are replaced at 60K miles that's about 1 cent a mile for tires.
    20 Sep 2013, 08:45 PM Reply Like
  • David G.
    , contributor
    Comments (189) | Send Message
     
    Has someone kept track of the bearish SA articles to bullish SA articles on TSLA?

     

    It's hilarious. Just do the opposite of what the majority of SA "experts" say, and you win on stocks.
    18 Sep 2013, 07:42 PM Reply Like
  • IncomeYield
    , contributor
    Comments (2506) | Send Message
     
    I have said that for years. The real value of sites like this are for contrarian indicators.
    19 Sep 2013, 01:05 AM Reply Like
  • Agnes59
    , contributor
    Comments (416) | Send Message
     
    @DavidG. I'm waiting for JP's so called expertise to emerge and that NYU professor Dasdamoran I think is his name what's he got to say now? I'm pretty sure they'll find something to say. Wonder who SA's going to hire next to write their analytical so called expertise regarding this stock. Deutsche Bank, & Daughtry has been right so far, who knows they may know something we dont.I rather listen to this people than some of this amateur analysts.
    19 Sep 2013, 01:01 PM Reply Like
  • ZeroIQ
    , contributor
    Comments (15) | Send Message
     
    I was told that stocks are valued on their future, but then the same
    Persons who told me that continue to look at tesla's number now
    And say the stock is too expensive. They also look at apple's current numbers and say that it's too cheap.
    People often don't practice what they preach.
    18 Sep 2013, 09:51 PM Reply Like
  • Joe Dirnfeld
    , contributor
    Comments (1128) | Send Message
     
    Tesla is not reaching market saturation or competitive price pressures . Until that lasts and they maintain their battery pack lead, this stock will
    Remain well bid.
    19 Sep 2013, 09:44 AM Reply Like
  • JRP3
    , contributor
    Comments (8775) | Send Message
     
    "Based on conversations with mgmt and monitoring information available on Tesla (TSLA) owners’ blogs, we believe that the company is on-track to modestly outperform Q3 margin expectations, that demand has continued to grow in the US and Europe."

     

    I've been telling people for years that some of the best information on Tesla can be found on the TMC discussion board. This analyst actually did his homework and gets it right by reading the data that we provide.
    18 Sep 2013, 10:11 PM Reply Like
  • IncomeYield
    , contributor
    Comments (2506) | Send Message
     
    Cool car, but without the lease deal and Resale Value Guarantee how many cars would they have sold?

     

    For all you accountants out there, how do you account for the Resale Value Guarantee issue?
    19 Sep 2013, 01:07 AM Reply Like
  • Rik1381
    , contributor
    Comments (1420) | Send Message
     
    "I've been telling people for years that some of the best information on Tesla can be found on the TMC discussion board. This analyst actually did his homework and gets it right by reading the data that we provide."

     

    Agreed. The predictions posted on TMC ahead of the 2Q earnings report were far more accurate and fact based that any other sources I've seen.
    19 Sep 2013, 01:44 AM Reply Like
  • Julian Acosta
    , contributor
    Comments (129) | Send Message
     
    I assume the analyst is speaking of the chart that's tracking the VIN #s. Pretty cool that he took that into account.

     

    You seem familiar with the forums; would you be able to provide more information on the accuracy of that chart and how reliable the VIN #s are as a measure of sales? Is there information the chart isn't capturing that may skew reality?

     

    From what I gather it seems like TSLA are on track to easily beat the 21k estimate. Potentially could top 30k, correct?
    19 Sep 2013, 10:07 AM Reply Like
  • JRP3
    , contributor
    Comments (8775) | Send Message
     
    I don't think they can beat 30K this year. I think 25K+ is a safe bet. VIN charting is tricky since they don't always build and ship cars in sequence, so there is some variability. Then again, they could ramp up production even more in the 4th quarter and surprise us.
    19 Sep 2013, 10:08 PM Reply Like
  • stockahead
    , contributor
    Comments (44) | Send Message
     
    here we go....(source Bloomberg)

     

    Deutsche Bank : Global Autos Daily : Morning News: Morning News
    2013-09-19 06:45:43.780 GMT

     

    Synopsis:
    *
    *Tesla – Margin progression and demand appear strong; raising target (Galves)

     

    Based on channel checks and discussions with Mgmt, we believe that Tesla
    (TSLA.OQ-US$166-B) is on-track to modestly outperform Q3 margin expectations,
    that Model S demand has continued to grow in the US and Europe, and that the
    factory production rate has continued to increase. As these key investor focus
    areas appear to all be heading in the right direction, we see a positive risk /
    reward through at least the end of 2013, are raising TP to $200 from $160, and
    reiterating Buy recommendation. We believe that Gross Margin (ex ZEV Credits)
    will likely hit 20% in Q3 (vs 14% in Q2), modestly higher than expected. On the
    demand side, we believe that order rates are approaching 30k units annualized
    vs DBe of <25k in Q2. Both US and European order rates appear to be increasing
    (despite substantial option pricing increases in effect as of late July).
    Finally, we believe that the production rate continues to rise well in-line
    with Mgmt target for 30k annualized by 2013YE which would support deliveries of
    30k+ in 2014 (vs guidance of 21k for 2013).
    19 Sep 2013, 03:52 AM Reply Like
  • Richard N
    , contributor
    Comments (2) | Send Message
     
    Amazing!!! All theses opinions. Bottom line it's like a slot machine ...you never know when it's gonna hit.
    19 Sep 2013, 09:01 AM Reply Like
  • SharkDude
    , contributor
    Comments (713) | Send Message
     
    We are close. this thing will drop quick to 150 some day and DB analyst will slap a 160 target back on it.
    20 Sep 2013, 02:02 PM Reply Like
  • Ron Reed
    , contributor
    Comments (319) | Send Message
     
    what tickles me is how all the "analysts" get to slap price targets anywhere they want, and when it makes a turn or never reaches that point there is no accountability for false targets. Good news comes out on "X" and they give it a PT of 100.00, bad news two weeks later and it drops to 50.00 all the while "X" remains at about 75.00. Price targets are useless unless they come from a respected source which are harder and harder to find these days.
    20 Sep 2013, 02:26 PM Reply Like
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