rtmark
LearnBonds.com

Tesla Motors Inc Mass Market Risks “Not Properly Recognized” [Report]

Tesla Motors Inc model s

Tesla Motors Inc (NASDAQ:TSLA) has a fan in Barclays analyst Brian A. Johnson, but it’s not an undying willingness to support the company. In a report released on Tuesday Johnson raised questions about the company’s future and rated the firm at Equal Weight. The report also included a price target of $190, unchanged from previous Barclays research on Tesla Motors.

Tesla model s

The big issues, according to Johnson, are yet to come and they’re not being properly priced into the company’s shares. The Barclay’s analyst specifies that “risks in becoming a mass-market OEM are not properly recognized.”

Big risks not recognized at Tesla Motors

Some of those risks are likely in execution. According to JPMorgan analyst Ryan Brinkman, Tesla Motors Inc (NASDAQ:TSLA) won’t be able to deliver more than 50 units of its Model X SUV before the end of the third quarter of 2015. What he highlights, in a report that remains positive overall, is that Elon Musk and his crew are regularly unable to fulfill promises, and that can hamper a company in the long term.

The risks involved in becoming a mass-market car maker are a little more extreme than simply releasing an SUV a few months late, bugs that lead to recalls are the big risk for Tesla Motors. One big issue with the Model X could kill the company for good. It’s those kinds of risks that Barclays reckons the market isn’t pricing into Tesla.

Good news is on the way

Apart from the first quarter earnings, which Barclays reckons could lead to a storm of negative trading around Tesla Motors, the news that’s on the way for the foreseeable future is likely good. The company’s next product launch is at the end of April, and that should add momentum to the stock according to the investment bank.

What kind of momentum that is really depends on the spin the earnings report puts on the company’s future. If the firm burned cash prodigiously in the first three months of the year, and needs to go to the capital markets to get the release of the Model X right, trouble can be expected.

Looking for maturity at Tesla Motors

The whole point of the Barclay’s analysis, and the analysis of many other conservative Tesla Motors followers, is that Tesla Motors is immature, and there are no signs of maturity on the horizon just yet. Elon Musk says the firm won’t become profitable until 2020. Until it manages to create some kind of financial security for itself, Tesla is a very risky proposition for investors.

Realizing that risk, not just mentally, but also in the price of the stock, is something that hasn’t happened quite yet, and its price is running well ahead of the Barclay’s target as a result.

Trusted & Regulated Stock & CFD Brokers

Rating

What we like

  • 0% Fees on Stocks
  • 5000+ Stocks, ETFs and other Markets
  • Accepts Paypal Deposits

Min Deposit

$200

Charge per Trade

Zero Commission

Rating

64 traders signed up today

Visit Now

75% of investors lose money when trading CFDs.

Available Assets

  • Total Number of Stocks & Shares5000+
  • US Stocks
  • German Stocks
  • UK Stocks
  • European
  • ETF Stocks
  • IPO
  • Funds
  • Bonds
  • Options
  • Futures
  • CFDs
  • Crypto

Charge per Trade

  • FTSE 100 Zero Commission
  • NASDAQ Zero Commission
  • DAX Zero Commission
  • Facebook Zero Commission
  • Alphabet Zero Commission
  • Tesla Zero Commission
  • Apple Zero Commission
  • Microsoft Zero Commission

Deposit Method

  • Wire Transfer
  • Credit Cards
  • Bank Account
  • Paypall
  • Skrill
  • Neteller

Rating

What we like

  • Sign up today and get $5 free
  • Fractals Available
  • Paypal Available

Min Deposit

$0

Charge per Trade

$1 to $9 PCM

Rating

Visit Now

Investing in financial markets carries risk, you have the potential to lose your total investment.

Available Assets

  • Total Number of Shares999
  • US Stocks
  • German Stocks
  • UK Stocks
  • European Stocks
  • EFTs
  • IPOs
  • Funds
  • Bonds
  • Options
  • Futures
  • CFDs
  • Crypto

Charge per Trade

  • FTSE 100 $1 - $9 per month
  • NASDAQ $1 - $9 per month
  • DAX $1 - $9 per month
  • Facebook $1 - $9 per month
  • Alphabet $1 - $9 per month
  • Telsa $1 - $9 per month
  • Apple $1 - $9 per month
  • Microsoft $1 - $9 per month

Deposit Method

  • Wire Transfer
  • Credit Cards
  • Bank Account
All trading carries risk. Views expressed are those of the writers only. Past performance is no guarantee of future results. The opinions expressed in this Site do not constitute investment advice and independent financial advice should be sought where appropriate. This website is free for you to use but we may receive commission from the companies we feature on this site.
Avatar

David is cool! :)