Tesla Motors (NASDAQ:TSLA): Investor meeting yielded significant positives, according to Goldman
The takeaways:
Orders have picked up for the Model S, tracking at over 4,000 from around 3,400 at year’s end. The company expects to have 2012 production sold out soon and believes the first 12 months of production could be sold out by the end of this year. The company is on track to launch the Model S by mid-2012, having now sourced virtually all of its components, providing better cost visibility versus a few months ago. This has also provided added confidence around the 25% gross margin target for the program. With Tesla working successfully though many key design risks, Goldman now sees increased focus on managing vendor risk and large scale production. While the Model S production target remains at 20,000 for 2012, Tesla is configuring the Fremont facility to manufacture 20,000 units on one shift per year, as opposed to the 10,000 originally planed, in order to maximize upward production flexibility. The company has completed the build-out of numerous drivable “alpha” prototypes and expects to produce preproduction “beta” prototypes in the fall which will be shown to the public.
While the company believes it has enough liquidity to complete the Model S program on its own it expects to conduct a $100-$200 mn capital raise in the fall to help cover the upcoming Model X program which has been accelerated as well as a stepped-up investment in vertical integration and additional equipment from the former NUMMI plant which should be able to service Tesla’s production needs for more than five years.
Implications
Management’s reiteration of production and cost targets on the Model S post supplier sourcing and extensive prototype testing is a significant positive and gives the firm increased confidence that investors will be able to exceed the 25% annual returns used to discount their price target.
Notablecalls: While Goldman is not exactly a Tesla bull (Neutral rated, $29 tgt), the note does include some new information that may cause quite a stir among investors:
- Tesla seems to be readying for greater-than-forecast demand for Model S.
- The company has enough cash to complete the Model S program without additional financing. The offering, speculated to be a very n-t event may actually be 6 months away.
- Overall, everything seems to be going as planned. This is a surprise in itself as Tesla is a relatively new company and therefore prone to experience delays of all sorts.
Goldman is calling the info they gleaned from the management a significant positive. That’s a strong statement on a high-beta name like TSLA.
Not exactly a trading call but I thought to highlight the comments following the hugely positive note from Morgan Stanley back in March.
Anyone can join.
Anyone can contribute.
Anyone can become informed about their world.
"United We Stand" Click Here To Create Your Personal Citizen Journalist Account Today, Be Sure To Invite Your Friends.
Lion’s Mane Mushroom
Mushrooms are having a moment. One fabulous fungus in particular, lion’s mane, may help improve memory, depression and anxiety symptoms. They are also an excellent source of nutrients that show promise as a therapy for dementia, and other neurodegenerative diseases. If you’re living with anxiety or depression, you may be curious about all the therapy options out there — including the natural ones.Our Lion’s Mane WHOLE MIND Nootropic Blend has been formulated to utilize the potency of Lion’s mane but also include the benefits of four other Highly Beneficial Mushrooms. Synergistically, they work together to Build your health through improving cognitive function and immunity regardless of your age. Our Nootropic not only improves your Cognitive Function and Activates your Immune System, But it benefits growth of Essential Gut Flora, further enhancing your Vitality.
Our Formula includes:
Lion’s Mane Mushrooms which Increase Brain Power through nerve growth, lessen anxiety, reduce depression, and improve concentration. Its an excellent adaptogen, promotes sleep and improves immunity.
Shiitake Mushrooms which Fight cancer cells and infectious disease, boost the immune system, promotes brain function, and serves as a source of B vitamins.
Maitake Mushrooms which regulate blood sugar levels of diabetics, reduce hypertension and boosts the immune system.
Reishi Mushrooms which Fight inflammation, liver disease, fatigue, tumor growth and cancer. They Improve skin disorders and soothes digestive problems, stomach ulcers and leaky gut syndrome.
Chaga Mushrooms which have anti-aging effects, boost immune function, improve stamina and athletic performance, even act as a natural aphrodisiac, fighting diabetes and improving liver function.
Try Our Lion’s Mane WHOLE MIND Nootropic Blend 60 Capsules. Today Be 100% Satisfied Or Receive A Full Money Back Guarantee Order Yours Today By Following This Link.