Skip to main content

Market Overview

Tesla's Capital Raise May Come A Year From Now

Tesla's Capital Raise May Come A Year From Now

Tesla Motors Inc (NASDAQ: TSLA) reported solid Q3 2016 results.

The company may need to raise capital in Q3 2017, Goldman Sachs’ David Tamberrino said in a report. He maintained a Neutral rating on the company, with a 6-month price target of $190.

Bear Thesis

Tamberrino mentioned that Tesla’s Q3 results reflected capital as well as operational efficiency, with positive free cash flow generation and sequential gross margin expansion. Also, new orders for Model S and X grew 68 percent year-over-year, versus 67 percent year-over-year growth in the prior quarter.

Bull Thesis

On the other hand, Tesla’s capex indicates that the company would need to raise capital sometime in 2017. Tamberrino added Tesla’s bottom-line profitability in Q3 was driven by ZEV credit sales of $139 million.

Strong Quarter Not Enough

“A solid quarter, but not enough Automotive mojo to overcome what we see as increased risk from the company’s capital deployment strategy and 2017 uncertainty from the Model 3 launch,” the analyst commented.

Although Tesla reported an EPS beat for Q3, the estimates for 2016, 2017 and 2018 have been reduced from $(0.59) to $(1.93), from $0.57 to $(2.03) and from $3.50 to $0.14, respectively, to reflect Citi’s move to GAAP revenue and lower gross margin due to a stronger headwind in 2017/2018 from the Model 3 launch.

Latest Ratings for TSLA

Feb 2021Morgan StanleyMaintainsOverweight
Feb 2021Piper SandlerMaintainsOverweight
Jan 2021Deutsche BankMaintainsBuy

View More Analyst Ratings for TSLA
View the Latest Analyst Ratings


Related Articles (TSLA)

View Comments and Join the Discussion!

Posted-In: David Tamberrino Goldman SachsAnalyst Color Reiteration Analyst Ratings Best of Benzinga

Latest Ratings

NIUDaiwa CapitalInitiates Coverage On41.5
QMCONorthland Capital MarketsInitiates Coverage On12.0
IBKRJefferiesInitiates Coverage On89.0
MRETFTD SecuritiesDowngrades18.5
SWKSGoldman SachsDowngrades135.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Everything you need to know about the latest SPAC news.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at