The incredible run for America’s top electric car manufacturer, Tesla Motors Inc (NASDAQ:TSLA), seems to have hit the breaks following mixed third quarter results and a cautious outlook. The stock has long been flying high this year, surging over fourfold, though it has taken a bit of a pause lately.
Tesla Earnings in Focus
Tesla missed on earnings but beat on revenues. The adjusted loss (including stock based compensation) per share came in at 4 cents versus the Zacks Consensus Estimate of break-even. Adjusted loss narrowed from the year-ago loss of $1.04.
Total revenue climbed 9% sequentially to $602.6 million and surpassed the Zacks Consensus Estimate of $553 million. Lower ZEV credit revenues were offset by increased vehicle deliveries and higher vehicle average selling prices. Gross margin (excluding ZEV credits) rose to 21% in Q3 from 14% in Q2.
The company delivered a record 5,500 Model S cars during the quarter and expects to deliver 6,000 cars in the fourth quarter. As such, TSLA raised its full-year forecast for total delivery to 21,500 from the previous expectation of 21,000.
For the fourth quarter, Tesla targets 25% gross margin. Additionally, earnings per share are expected to remain unchanged from the third quarter.
Disappointing results and a fall in ZEV credit revenue compelled investors to lock in some gains, leading to a sell-off. Tesla shares tumbled more than 12% in after-hour trading on Tuesday (read: 4 Sector ETFs to Watch in Q4).
Tesla currently has a Zacks Rank #3 (Hold) for the short term, suggesting that the bullish trend might come to a standstill for the time being and investors could book profits at the current level.
ETFs to Watch
A couple of ETFs having heavy exposure to this auto company were enjoying huge gains when Tesla share price rallied.
Tesla has been one of the hottest stocks of 2013 and a favorite pick among growth investors, surging nearly 422% in the year-to-date time frame. With TSLA’s third quarter disappointment and the large drop in its after-market share prices, this positive trend is less likely to continue.
Below, we have highlighted two ETFs that have a large allocation to TSLA and will likely be in focus in the coming days.(...)Click here to continue reading the original ETFDailyNews.com article: Tesla Motors Inc (TSLA): Two ETFs In FocusYou are viewing an abbreviated republication of ETF Daily News content. You can find full ETF Daily News articles on (www.etfdailynews.com)
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