Shares of Tesla (NASDAQ:TSLA) are higher in premarket trading as Baird keeps a positive outlook on the company after taking in the latest developments.
"While we do not model GAAP profitability for conservatism, we believe TSLA will be able to achieve sustainable operating cash flow and operating profit in the intermediate-term, which would be a significant catalyst, in our opinion," writes analyst Ben Kallo.
As expected, Tesla said at the annual shareholder meeting that it's on track to hit a production rate of 5K cars by the end of the month and detailed plans for the Shanghai factory. The shareholder votes also went according to plan, although Kallo thinks the wide margin of the board re-election is a vote of confidence in current management.
It's not too early to talk about the Model Y after the company released another teaser picture of the electric SUV and Elon Musk joked on whether it would even have a steering wheel. Bullish-leaning firms such as Baird think that Tesla's valuation can remain elevated if enthusiasm over the long-term potential of the Model 3, Tesla Semi and Model Y keeps churning.
TSLA +3.91% premarket to $302.50.
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