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Jefferies stays bullish on Tesla Motors

  • Jefferies ups its price target on Tesla Motors (TSLA +3%) to $210 after the EV automaker successfully navigated around questions on safety last week following a single report of a Model S fire.
  • The investment firm thinks Tesla will deliver 5.5K units in Q3, up from a prior estimate of 5.35K.
Comments (59)
  • Just can't keep a great company down :)
    7 Oct 2013, 10:20 AM Reply Like
  • are the shorts feeling nervous??
    7 Oct 2013, 10:24 AM Reply Like
  • no
    7 Oct 2013, 12:12 PM Reply Like
  • Don't short. Buy puts. Or just stay out.
    7 Oct 2013, 12:13 PM Reply Like
  • We're just wondering how compelling these buy recommendations are from the sell side. A 13% return from today's levels, while most are calling for a price around $200, which represents only an 8% return. The upside appears minimal, while we feel the risk to the downside is meaningfully higher.


    Full disclosure: no position
    7 Oct 2013, 10:24 AM Reply Like
  • "A 13% return from today's levels, while most are calling for a price around $200, which represents only an 8% return."


    What in the world are you trying to say? 13 = 8?
    7 Oct 2013, 11:58 AM Reply Like
  • They are posturing for the next bit of banking business. Jefferies thinks they will be in running for next secondary offering if they have the highest target on the street. However, it will most likely go to Goldman since Elon still owes him for creating the first massive short squeeze wave. Jefferies will get taste of the syndicate with their $210 target. It was raised with only that in mind.
    7 Oct 2013, 12:14 PM Reply Like
  • Because previously the analysts said 100% upside? No. There is relatively no difference between the % return on current price targets compared to price targets in the past. Go back and look when the stock was around $30, there were no PTs even over $50.
    For your reference:


    Permabears with no position are just a joke.
    7 Oct 2013, 12:51 PM Reply Like
  • Not sure how a sales beat of 150 units and irrelevant safety issues (did anyone seriously believe that the fire incident meant EVs were less safe than ICEs?) warrants an increase in market cap of ~$2.86 billion.
    7 Oct 2013, 10:25 AM Reply Like
  • No, but they may believe that having the batteries low, and in the front of the car may represent a design flaw that the NHTSA will want changed. Whether that winds up being true or not, Tesla really caught a break with this incident occurring during a government shut-down, meaning that such an investigation will be delayed.


    Also, all the people thinking that there are lots of short sellers out there who are sweating price increases need to read this comment: because it just ain't true.
    7 Oct 2013, 10:53 AM Reply Like
  • Batteries may be mounted low, but they are not concentrrated in the front of the car.


    They are spread out over the ENTIRE footprint of the car, with the exception of the the first couple feet of the front and rear crumple zones. As such they will always be vulnerable to damage in a multitude of unforeseeable events.


    Weather or not that makes the car more or less hazardous vs a Gasoline powered car, may be a bit more complicated and require a few more real life events to play out.
    7 Oct 2013, 11:29 AM Reply Like
  • "they may believe that having the batteries low, and in the front of the car..."


    The Model S battery is not in the front of the car. It is behind the large front crumple zone.
    (scroll down to the diagram)
    7 Oct 2013, 11:34 AM Reply Like
  • Esekla, you need to quit stating outright falsehoods. Do you do it out of pure spite or are you truly ignorant?
    7 Oct 2013, 11:38 AM Reply Like
  • Yep, I never stated that they were *concentrated* at the front, just that some of it towards the front.


    I certainly acknowledge that the car is safer than most ICEs. None of that is the point. The point is that cars generally move forward, and things that they strike going forward are generally on the ground. Thus, this isn't the last time you're going to see this sort of event.
    7 Oct 2013, 11:49 AM Reply Like
  • I think what Esekia is trying to say is that the batteries are low and "extend into the front of the car", unless I am mistaken. Correct me, if I am wrong here, Esekia.


    However, if you look at many of the accidents which have occurred with the Tesla Model S - several of them being front-end collisions - not even once has it caused a fire, much less an injury with anyone riding in the Model S (unless you would think that a bruised knee is an injury). I would not consider the battery location to be a design flaw, although possibly there could be a bit of Kevlar armor plating placed alongside of the 1/4 inch of steel that is already protecting the battery pack, if they would want to improve its protection.
    7 Oct 2013, 01:35 PM Reply Like
  • I'm certainly not going to make a decision on a Jefferies call, never have, never will. It's kind of like trusting government, but government gets it right more often, and that's a scary thought. At least in the USA. Hope I didn't offend another country, especially - Uganda.
    7 Oct 2013, 10:37 AM Reply Like
  • Interesting how the fire actually validated the battery's safe design (containing the fire to the front, allowed driver to exit safely) yet people made a huge stink of it.


    And its just an excuse for Jeffries to raise their PT, you will see others follow suit.
    7 Oct 2013, 10:37 AM Reply Like
  • NFLX will crash and burn long before Tesla will. NFLX has several bigger direct competitors with deeper pockets. Consumers are also more price sensitive as the stampede to leave a few years back due to a relative price increase tanked the stock.


    Tesla's competitor's offerings are either poor (Leaf) or ugly (BMW i3) or targeted at a completely different market (BMW i8 is a hybrid more than pure electric car). Also, if Tesla jacked up their prices from $5-10K, Model S/X buyers probably would't event blink.
    7 Oct 2013, 10:42 AM Reply Like
  • Vico Confino Tesla 85 owner
    Sick and tired of hearing the cry babies, naysayers, numbers crunchers and know nothings bad mouthing the auto of the future.
    I have not been to a gas station in 9 months and I am still deliriously enjoying the phenomenal ride of my Tesla.
    As far as I am concerned even if Tesla went bust, I would still have my Tesla and it would become a rare and priceless collectible.
    Who am I ?
    Vico Confino
    An 80 year old man, trapped in the body of a 40 year old with the libido of a 20 year old kid.
    Nuff sed
    7 Oct 2013, 11:06 AM Reply Like
  • congrats to you sir, and yes it is quite interesting the amount of vitriol, bashing, naysaying, and flat out lies that Tesla endures (and when they can't talk bad about Elon and the company they rag on T$LA LOL).


    and with the CHAdeMO Adapter being offered to Model S owners Electric is looking more and more like the future (while setting Tesla up nicely as well).
    7 Oct 2013, 11:22 AM Reply Like
  • No matter how good the car may or not be, this has little to do with weather the stock is a good value from these levels.


    Do not make the mistake of mixing your emotional love for a product, with investment decisions.


    AAPL shareholders that bought above $675, found out the hard way.
    7 Oct 2013, 11:29 AM Reply Like
  • Vico, you have an EXCELLENT perspective on life! I'm 54, listening carefully & really enjoy your comments. Thank you for your contributions!
    7 Oct 2013, 11:53 AM Reply Like
  • Vico: I am 81---trapped in a body and libido of the same age-- live in Brooklyn and do not yet
    own a tesla--but will as soon as pratical. But bought , for me, a very good position in stock and
    Out of the money calls in 36-38 range.
    7 Oct 2013, 03:30 PM Reply Like
  • 1980: I agree - however, one criteria = Do not fall in love with the stock. Fall in love with the product, otherwise do not invest in the stock. And Vico: Thank you for your inspirational comments. Enjoy.
    7 Oct 2013, 03:32 PM Reply Like
  • Every time I read these comments with all the minutia of battery discourse and electrical numbers like every tesloan was Einstein - rather than regurgitating other articles as they are doing , I am constantly amazed at the insanity from a value standpoint of this as a stock. Really it boils down to a very simple fact set - this company is losing money (in reality) , has one car model (versus GM's 50 or BMW's 10 or Fiat's 25) , ONE CAR MODEL which is priced only for the WEALTHIEST Individuals that requires knowing where charging stations are throughout the world to drive anywhere beyond the nearest village and the BATTERY may be in short supply and too expensive to turn much or ever a profit and the CAR MAY BE FLAMMABLE (unsafe at any speed) but the STOCK values the co. at more than Fiat, Hyundai, Kia, Porsche and 1/2 of GM. And now you get the Pac. Crest pump and dump scumbags touting the highest target on the street. IF this stock is over 50 a year from now the Dow will be at 50,000 , so just buy the Dow , it is fire-resistant. You guys are crazy not to sell, if you actually own any of this Tucker stuff.
    7 Oct 2013, 11:23 AM Reply Like
  • mysterywriter, you mad bro? Shorting some more?


    Tesla Model S's are only $70-125k. That's hardly for the wealthiest of individuals. Hundreds of thousands of luxury cars are sold each year in just the U.S.


    The #1 charging station is in your garage. That is, unless your house doesn't have electricity.


    I'm curious if you drive a non-flammable car. Non-flammable rules out gasoline, diesel, propane, natural gas, and hydrogen fuel cell. Even a horse puts out methane. Flywheels are a possibility, but if anything go wrong, that's a huge mess like a whirling dervish of destruction. So…what do you drive? We could probably find a video of it on fire somewhere.
    7 Oct 2013, 11:36 AM Reply Like
  • it's not a mystery


    Tesla is a tech co not a car co----that is why so many are losing their shirt-----
    7 Oct 2013, 11:38 AM Reply Like
  • he def mad lol......
    7 Oct 2013, 11:45 AM Reply Like
  • "You guys are crazy not to sell"


    So you have been saying for months, as Tesla keeps racking up achievements and the stock keeps rising. When do you think the achievements will stop coming?
    7 Oct 2013, 11:47 AM Reply Like
  • Hey mysterywriter, I own quite a bit of TSLA. Do you know how many car fires there are every year?



    In 2011 a total of 270 died in vehicle fires, and they were all gasoline engines. None of those fires made the news, only the traffic reports telling people to avoid an area with a vehicle fire.


    But one Tesla fire?


    Teslamotors is a complete threat to the entire oil industry. If you own oil stocks, your portfolio is at risk. In your comments you made a lot of false statements, I really should be reporting you to Seeking Alpha. I don't want to waste my time dissecting your comments or reporting you, other people will do that.
    7 Oct 2013, 12:54 PM Reply Like
  • FIND the VIDEO!!!!! LOL!!!!!
    7 Oct 2013, 12:57 PM Reply Like
  • It's not where the company is... it's where it may go.


    I admit, I'm a Tesla guy. But, I'm a Tesla guy because of their excellent engineering & Elon Musk (my background is engineering).


    Yes, the stock price is outrageous viewed against their current fundamentals. However, if you think that Tesla is leading a massive change in the automobile industry (which I believe), the stock price isn't so crazy.


    That said, a lot of things will need to go right for Tesla over the next 4-5 years to justify the current price. On the other hand, only a fool bets against Elon Musk.


    I stumbled across Tesla in March, 2012 when my wife & I watched "Revenge of the Electric Car" one evening. After seeing that video, I researched the company & Elon Musk, then put 60% of our retirement funds into Tesla. That was the best investment I have ever made by far. At this point, we've cashed out our original investment, paid off the house & established a very healthy emergency fund (the 1st time I've ever been able to do that) while maintaining the majority of our Tesla investments.


    Elon Must is an OUTSTANDING engineer & an EXCELLENT entrepreneur. He & the Model S are the reasons I got into TSLA @ $35 & I plan to stick with him & Tesla for at least the next 5 years.


    If things play out the way I think they will (and I freely admit that I am quite fallible in predicting the future) Tesla will continue to be an excellent investment in the long run (5+ years).


    That said (I pay close attention to Randy Carlson's writings), I'm very hesitant in suggesting Tesla is a good investment at today's prices (a LOT of things have to go right to justify the current price); but, knowing all that they have achieved to date, I would NEVER short it!


    As always, I wish you & everyone the best of luck with their investments.


    Side comment... 2012 was the first time I ever setup a brokerage account. One question as a newbie... This all seems like gambling to me in a rigged game (I've been very lucky so far). What ever happened to capital formation?
    7 Oct 2013, 01:03 PM Reply Like
  • @mysterywriter. "where charging stations are throughout the world "


    just unplug your computer, or any other appliance and plug into 110v, or use 30,50,70 amp 220v circuits. There are literally hundreds of MILLIONS OF OUTLETS/CHARGING stations just in this country.
    look on Tesla web site for gender benders for charging plugs.
    7 Oct 2013, 02:53 PM Reply Like
  • Stuffing thousands of Laptop batteries in a pretty car, is not technology.


    Do not kid yourself.
    7 Oct 2013, 03:30 PM Reply Like
  • diesel is not flammable.


    It is classified as combustible.


    Big difference.
    7 Oct 2013, 03:32 PM Reply Like
  • The value is a "mystery," but the innovation and future look bright. A few models in the $30K range, with additional charging stations and superior batteries, seems plausible and, well . . . it is just a matter of time.
    7 Oct 2013, 03:32 PM Reply Like
  • only 70-125k - gee that's a large potential buyer demographic, that's what made Ford successful and honda and toyota - it only eliminates about 98% of all potential buyers. And the fact that it is an EV eliminates another 3% so yeah that's a great business plan - a potential buyer pool of - let's see, I got it, the people who already own one. And I usually don't travel with my house, do you? I drive a BMW 330I , find me the video and I want it to be as awe inspring as the Tesla one. You know that is why companies that have been around a while are good investments, because they have a track record on the financial side, the resale side, the reliability side and they have gotten most of the kinks out of their products.
    I am short - at 183 and it will be a very successful short; remember that when you aren't so cocky and afraid to post here when this is a significantly double digit stock and Elon is E-gone.
    7 Oct 2013, 03:33 PM Reply Like
  • "I drive a BMW 330I , find me the video..."
    Here are videos of BMWs on fire. I'm not sure if your exact model is among them; there are too many to search.


    "...and I want it to be as awe inspring as the Tesla one."
    Will dead people impress you?
    7 Oct 2013, 04:10 PM Reply Like
  • name one - in 2011 there were no teslas - but that is not the point nor is the fire, except it indicates a lack of perfection - and the stock is certainly priced for perfection - and potentially a design flaw.It should be way more possible to create perfect cars when you are making 400/week versus a million a week , so I would be very nervous if they ever ramp up. Back to all my false statements -I don't pull numbers from tech manuals like you guys, I stick to fundamentals so I would love to know what grave factual errors I made.
    7 Oct 2013, 04:12 PM Reply Like
  • "when you are making 400/week versus a million a week , so I would be very nervous if they ever ramp up."


    Tesla is currently ramped up to over 600 cars per week. When they are making a million a week, the last thing I will be is nervous.
    7 Oct 2013, 04:24 PM Reply Like
  • mysterywriter,


    I'm betting you aren't in business. 98% + 3% is more than 100%. Tesla is going to sell each and every single Model S they can make this year and next year. They are production constrained, not market constrained. So arguing that the market is small is rather silly.


    If you won't bother to understand the dynamics of EV charging, then so be it. But to short TSLA based on that? Good luck.


    You mention resale and reliability - BMW does not have a good track record on either of those. Matter of fact, BMW has a pretty terrible reliability record amongst luxury brands and is especially bad at initial quality. But people don't usually buy BMW for reliability.


    In any case, people aren't going to buy a Tesla vs. a BMW based on resale or reliability.


    As for fires, the Tesla video started after the fire department was there and let the fire have more air.
    Several BMW 3 series fires on youtube:


    This BMW 5 series has a pretty impressive fire:


    This one with a BMW M6 is a pretty impressive fire, but the videographer didn't do a good job:
    7 Oct 2013, 04:38 PM Reply Like
  • "diesel is not flammable.


    It is classified as combustible.


    Big difference." Have you ever seen or tried to extinguish a diesel fire? Once that stuff starts to burn it takes significant effort to extinguish. Water will only spred the fire.
    7 Oct 2013, 09:15 PM Reply Like
  • "It should be way more possible to create perfect cars when you are making 400/week versus a million a week" Please name one manufacturer that currently builds even 1 million of a single model in one week. Even at its peak of popularity the VW type one (old air cooled bug) only ever managed to hit production levels of just over 1 million per YEAR but never 1 million per week. BTW VW's type 1 is still the most popular car model ever sold with well over 20 million units sold from just after WW2 until model year 2003 all without redesigning the basic car. (My numbers do not include the "new beetle" as that is just a re-skinned golf) (also the Toyota Corolla does not count as the car has undergone too many redesigns during the run of its nameplate to be considered the same model from start to present). Point is mystery when you throw out random numbers try to make them reasonable so they don't hurt your argument.
    7 Oct 2013, 09:30 PM Reply Like
  • @mystery Why would I need to know the location of an electric vehicle charging station in parts of the world other than my immediate vicinity? It's not like I'll be driving to Albania or even Alabama anytime soon. If I do choose to go to an area I'm unfamiliar with I also don't know where the gas stations are. Tell you what I've got a handy dandy app on my phone that tells me where the nearest EV plug is and, if I were driving a Tesla guess what? It has a giant screen in the middle of the dash that will show you where the nearest charging station is and even plot the shortest route to get you there. Oh FYI I find it very humorous when you call Tesla Tucker, you do realize that the Tucker represented a huge leap forward in automotive technology and was only killed off by the "big three" because they knew they couldn't compete with Mr. Tucker's superior product. The big difference between Tucker and Tesla is that the other manufacturers managed to kill the Tucker before production reached more than a few dozen prototypes but the cat is waaaay out of the bag with Tesla so it's not going to be easy (or even possible) to kill off Tesla like Tucker.
    7 Oct 2013, 09:47 PM Reply Like
  • The world is covered with electrical sockets. All hotels can give much better than average amps a commercial kitchen you got the juice.
    7 Oct 2013, 09:53 PM Reply Like
  • Yes the car IS expensive to purchase but cheap to run and the money being spent by wealthier people now is enabling others to buy the MODEL E in the next 4 to 5 years for $35K which is in fact like buying a $20K car when you no longer have gas/petrol costs.


    Today people who are $20K vehicle buyers have two monthly car payments one to Big Auto/Big Bank and the other to Big Oil/Big Gov.
    One car payment per month for a MODEL E charging at home for $4
    for at least a 180 miles of commute use is a massive saving.
    7 Oct 2013, 09:55 PM Reply Like
  • Seriously..who exactly is making a million cars per week?


    Toyota who made a record breaking 9.9 million cars last year make about 27,000 cars per week across all of their worldwide factories (about 45 factories not including joint venture facilities with other auto companies).


    This means on average Toyota makes around 200,000 cars at each of its factories. Tesla's facility has the ability to produce around 500,000 conventional gas vehicles per year (as it once did under GM/Toyota).
    Many have disregarded the fact that different models of EV can all be build off of the common Model S platform. Tesla will thus be able to build sedans, SUV's, roadsters, pickup trucks, etc, etc all in the SAME factory using up substantially less real estate than most other automakers. This is actually a pretty big deal that people will wake up to once they understand the utter superiority of an EV drivetrain over than of an ICE vehicle.




    An interesting note who believe dramatic growth isn't possible in the car industry:
    In 1955 Toyota made around 22,000 cars (about the same Tesla should make this year).
    13 years later Toyota was making 1.1 million cars per year.
    (Interestingly they went from making 550,000 cars in 1966 to 1.1 million in 1968)


    Given the massive advances in automation and auto manufacturing expertise since the 1960's and 70's Tesla's growth could occur two or three times as quickly as Toyota's did...all they need is the capital and desire to do so.


    My prediction for Tesla?:


    2016: 400,000+ vehicles
    2020: 1 million+ vehicles


    What if you could have been an investor in Toyota back in 1955?


    Only difference with Tesla is that by the end of 2015 they will have a worldwide network of superchargers covering 98% of the developed world.
    Now imagine the potential of Toyota back in 1955 if they owned all the gas stations as well?


    7 Oct 2013, 11:06 PM Reply Like
  • don't worry , you won't get to experience that - 600/week will probably be close to their apex.
    7 Oct 2013, 11:45 PM Reply Like
  • I meant 98% and another 3% of the remaining two % - but let's focus on really important stuff like 98 plus 3 =101 , unless it's 97.5 rounded up to 98 and 2.5 rounded up to 3. And yes I ran a very successful RIA business for 25 years not to mention PaineWebber equity strategy desk for a bit and owned retail stores and a manufacturing business. What do you do? And your opinion about bmw resale and quality is just that, not borne out by fact.Look you are a Tesloan for now - one model, 4-500 cars/week with no resale history to quote , except the buyback guarantee.There is of course no reliability history, nor a profit history beyond subsidies. If a computer or handset company had this limited a portfolio or sales penetration of it's markets you would laugh at them. You , like all tesloans, announce how many cars they will sell next year like it were chiseled in stone.If the demand is so great for this vehicle why did they concoct the very favorable lease deal? I will tell you - because sales demand for an awkward 100k car is already slowing. When you guys stop insulting experienced, questioning investors who have been so much more successful in life than you may ever be you will learn that companies like tesla come around and go away - to suggest the whole auto industry is stupid and elon musk figured out that ev's would sell when no one else did is naive and doesn't add up to 2% much less 101%. And your point about video fires is so childish - look at the current market cap each S is worth a million and a half bucks.
    7 Oct 2013, 11:59 PM Reply Like
  • mysterywriter,


    You are the one that kicked off this subthread with a rant with a number of half thought out criticisms. You brought up the fire risk and so it is fair to bring up the fire risk if your current automobile which is actually pretty substantial. You brought up that the Tesla is only for the wealthiest of individuals like it was a McLaren P1 or a Porsche 918 Spyder. You brought up reliability and resale - it's pretty easy to see the low rankings compared to other luxury car makes that BMW gets on JD Power surveys or other consumer car review sites. BMW's are great, but initial quality is pretty poor. There is a resale history of Tesla EV's… it's really hard to get a Roadster at a low price. You also have no idea if demand is slowing. None at all.


    Again, you started this with a rant filled with tenuous supports of a bear position. Your ignorance is showing through. Is this the way you write business plans? Make strategic decisions? Evaluate and take risk? Good luck.
    8 Oct 2013, 02:02 AM Reply Like
  • These aren't even half-thoughts, just company mantra , non-thoughts. Everything I wrote will be in your thoughts pretty soon - why did I buy a company with limited sales, with just one model, with no reliability history, why did they do that silly lease deal where they are losing money buying back cars, the economy has tanked 100k cars are not easy to sell, how come the projected number of charging stations keeps coming down, how come they did another heavily-dilutive secondary, how come they keep losing money, what happened to the 25% margins (an insane prediction to start with) etc. How do you like the equity price today?
    9 Oct 2013, 09:55 AM Reply Like
  • how many cars does gm build a week in totality - all models, all countries?
    9 Oct 2013, 10:09 AM Reply Like
  • Less than Toyota...see my example above and get a clue. Model S sales are off the charts in all countries it currently sells in. No demand problem...only a supply problem...and Tesla is working on that. 25k+ sales this year...45k+ next year...easy.
    14 Oct 2013, 06:01 AM Reply Like
  • Considering the number of cars Tesla is selling at such high prices, it tells me this compay will soon take over Ford, GM and Chrysler in terms of sales and revenue in the near future, 5 years tops.
    Only an opinion....
    7 Oct 2013, 11:29 AM Reply Like
  • I would say your opinion is a good analysis. I concur.
    7 Oct 2013, 12:58 PM Reply Like
  • Raising the price target 30% is more than staying bullish. I can't wait to read the report. Obviously it will not be based on "numbers" or "facts". Maybe like DB is will be based on visiting the really cool plant or reading company blogs. Oh and cute how their "model" just edged out the last upgrade by 10 bucks. I bet they think they can now beat out Deutsche Bank for next secondary since they are that much more bullish on the company.
    7 Oct 2013, 12:11 PM Reply Like
  • Wow. I just read the comments. So the target goes up 30% based on selling 150 more cars?????????? OMG. and sold at a loss. And of course the CEO will defend his company when there is negative news!!! That is also worthy of an upgrade?
    7 Oct 2013, 12:16 PM Reply Like
  • Up, up, and away.


    Mr. Fredricksen...


    Doesn't he look like Buffett?
    7 Oct 2013, 12:19 PM Reply Like
  • I'm 66 and feel like 96 I need a Tesla to feel young again.
    7 Oct 2013, 09:34 PM Reply Like
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