According to Morgan Stanley’s report, third-quarter results showed increased cash consumption, “testing investor resolve of capital adequacy and raising the stakes for addressing Model X launch issues.”
Nonetheless, the analysts believe Tesla’s longer-term ambitions of advancing the state of sustainable transport have considerable room for market appreciation.
Looking Into 2016
Going into 2016, Morgan Stanley analysts think Tesla shareholders should be prepared for a few “potential fundamental developments” they have modeled and think are critical to comprehending the whole story.
- 1. The firm forecasts cash burn will continue into the fourth quarter and into 2016.
- 2. The experts assured they are prepared for “potentially lower levels of vehicle deliveries” (compared to those targeted by management) in the fourth quarter and in 2016.
- 3. They anticipate a Model 3 to boast an average transaction price of roughly $60,000 per unit.
- 4. They think the company should “eventually more clearly communicate any potential plans for a mobility service (selling miles, not cars) to investors.”
Disclosure: Javier Hasse holds no positions in any of the securities mentioned above.
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