Tesla Inc. (TSLA) PT Lowered to $195.00

Chelsea West
November 2, 2017

But investors' eyes were on the Model 3, the $35,000 vehicle that's meant to move Tesla from a luxury niche automaker into the mainstream.

Tesla Inc.'s first attempt at high-volume production isn't going as well as it hoped.

It added that it had produced just 260 of the Model 3 cars in the third quarter, rather than the 1,500 it had planned to build.

For months, Tesla's forecast a production rate of 5,000 Model 3 electric sedans a week by the end of December.

And the problems will continue.

Tesla said in a letter to shareholders it expects to achieve a production rate of 5,000 Model 3 cars per week by late in the first quarter of 2018. Main Street Research LLC bought a new stake in shares of Tesla in the 2nd quarter worth about $602,000. The insurer reported a net loss of $87 million, or 8 cents a share, in the quarter to September 30, after net income of $571 million, or 51 cents a share, in the same period a year ago. The electric vehicle producer reported ($1.33) earnings per share (EPS) for the quarter, beating the consensus estimate of ($2.00) by $0.67.

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That was a far bigger decline than Wall Street had predicted.

On Wednesday, however, the company admitted that because "the Model 3 production process will be vastly more automated than the production process of Model S, Model X [.] bringing this level of automation online is simply challenging in the early stages of the ramp". The company opened 18 stores and service stations worldwide during the quarter, and set up 126 new Supercharger stations to try to prepare for the increase in demand from Model 3 buyers. Tesla's other vehicles, the Model S and Model X, will be given less attention as the company shifts focus to getting the Model 3 up to speed.

Tesla's shares fell 3 percent to close at $321.08 Wednesday.

Results from electric cars maker Tesla Inc (NASDAQ:TSLA) are likely to be all about the ramp-up of production of the new model 3. Revenue rose 2% to $16.10 billion, beating the FactSet consensus of $15.52 billion, as 9% growth in premiums, fees and other revenue offset a 7% drop in net investment income. During the same period in the previous year, the firm posted ($1.06) earnings per share.

Tesla, Inc, formerly Tesla Motors, Inc, designs, develops, manufactures and sells fully electric vehicles, and energy storage systems, as well as installs, operates and maintains solar and energy storage products. Energy generation and storage accounted for 11 percent of Tesla's third quarter revenue.

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