Tesla Motors Inc (NASDAQ:TSLA) will not launch Model X until 3Q2015 although the launch was expected in 2Q2015. As a matter of fact, Model X was expected out in 1Q2015. However, Tesla’s CEO, Elon Musk, who is among ten richest billionaires downplayed the delays of the SUV, but not all analysts are convinced that all is moving in the right direction at Tesla. Wall Street weighed in on Tesla, with analysts looking at its short-term challenges and the long-term potentials. Analysts are divided about whether the short-term challenges in the company should impact investors’ long-term outlook on the stock.
Musk stated that it was possible for Tesla Motors Inc (NASDAQ:TSLA) to grow at 50% yearly even without bringing a new product to the market. That was one of the assurances that the business leader made to investors. Nonetheless, Musk stated that they were working to launch Model X next year, although at a later date than was previously expected. Delays notwithstanding, Musk said that Model X will be “something special”.
The SUV is expected to be more expensive than Model S. The company looks to Model X as a generator of good cash flow, which should help them avoid fundraising for the mass market targeted Model 3.
The optimistic analysts think that Musk is right on his take on the company’s growth and the potential of Model X. The analysts also love the company’s financial profile. Tesla enjoys gross margin of 29%, according to the 3Q metrics, which compares favorably with 11.6% at Ford Motor Company (NYSE:F). The company also has a smaller debt position, which puts its balance sheet in a solid position. That makes them think that the stock is a good pick for the long-term despite any short-term challenges.
However, some other analysts are not as excited about the prospects of Tesla Motors Inc (NASDAQ:TSLA). This group cites the delays in the release of Model X and growth in sales that fell short of the estimates in 3Q. They also recognized the warnings shots that the company recently issued, especially about shipping fewer vehicles this year that it earlier forecast. This group of analysts thinks that the short-term impacts have a long-term bearing on the stock.
Daniel Benton‘s Andor Capital Management held 1.25 million shares of Tesla Motors Inc (NASDAQ:TSLA) at the end of the second quarter of 2014.
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