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Tesla Motors Inc (NASDAQ:TSLA) Has a Lot Left to Do after Q2 Record-buster

Elon Musk SolarCity Corp (NASDAQ:SCTY)

Tesla Motors Inc (NASDAQ:TSLA) , last week, revealed its Q2 delivery numbers, which not only came in above estimates, but also topped the EV firm’s own guidance by over 500 units. However, despite resting fears of a slowdown and answering critics aptly, this US firm has no time to be complacent or rest.

Elon Musk SolarCity Corp (NASDAQ:SCTY)

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The year 2014 was not a good one for Tesla Motors. ThOwing to its struggle in China, and the firm’s miss of Q4 delivery targets owing to the supply issues. Despite this, the firm came back strong to post record figures. For the Q2, Tesla announced the delivery of 11,507 units compared to 10,030 units in Q1. The Q2 number was 52% up from the same quarter last year.

Following visits to the firm’s California production facility, many analysts are positive over the short-term prospects of Tesla. Analysts are satisfied with production runs at the firm, and expect the much-awaited Model X to launch in-time. Also, Bank of America, which is one of Tesla’s biggest bears, raised the price target on the EV firm to $180. So, the next task for Tesla will be to come up with its Model X on time.

Tesla Motors bears still exist, however, and some of them are meaner than ever. After hearing its most recent sales numbers Citron Research said it was going to short Tesla and accused the firm of trying to manipulate the market. Citron said that Tesla had done the ‘ultimate Wall Street trick of lowering the bar to just jump over it.’

Citron’s claims won’t be taken as seriously as the upgrade in price target from Bank of America, but they help to remind Tesla bulls that there’s a big bear case out there on Tesla. On June 15, the most recent data we have, 24,489,744 shares in the firm were sold short. That’s about 20 percent of the total. It’s not clear whether more or less shares are short right now, but shares have risen by more than 10 percent since those numbers were released.

In the last 12-months, the stock is up over 22%, and is now catching to its 52-week high of $291.42, which was hit last year. In April, the firm also moved into the energy storage, which after initial doubts, is expected to do well. The Tesla Model 3, which is into final design stages, is expected to be unveiled next early year. So, even after Model X, Tesla do have a lot to keep it busy.

China will keep Tesla busy

Tesla has been quiet on its China sales after Q4 last year. The firm launched its vehicle in the region last year, hoping to benefit from the Chinese govt. support to the green energy. Owing to the lack of charging infrastructure in the country, buyers were afraid of ‘range anxiety,’ a fear of running out of charge.

Tesla CEO Elon Musk accepted the issue, and told the Verge, “Things were a little weaker in China, just because of some communication issues. People have the perception that charging is difficult in China.” Though the firm has been making progress in the charging services, it has been afraid of sharing region-wise sales number. So, until it provide more details on its Q2 sales, it will be hard to say if the firm is making progress in China.

In the last trading session, Tesla shares closed up over 4% at $280.02, and year to date the stock is up 26%.

Update 10:05 EDT: Added pars on Citron research Tesla short idea.

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Aman is MBA (Finance) with an experience on both marketing and Finance side. He has work as a Risk Analyst for AIR Worldwide, and is currently leading VeRa FinServ, a Financial Research firm. Favorite pastimes include watching science fiction movies, playing PC games and cricket.