Tesla Motors, Inc.
) surged 7% yesterday to close at $177.92, after reaching a new
52-week high of $180.47. The stock witnessed trading volumes of
15.6 million, significantly higher than the three-month average
volume of 10.3 million.
The surge came on the back of a 25% increase in Tesla's price
target to $200 by an analyst of
Deutsche Bank AG
). The analyst expects the company to beat margin expectations in
the third quarter, driven by strong demand and production
Tesla's stock has skyrocketed 403.2% from $35.36 at the
beginning of the year. The outstanding performance can be
attributed to stable demand and strong safety ratings of Model S,
along with sustained innovations by the company.
Tesla recently announced its plans to develop an autopilot
system, which will allow the car to cover 90% of the miles driven
on its own. Tesla is aiming to launch the car in 2016, although a
completely self-driven car will take much longer to develop.
Apart from this, Tesla is also aiming to make its car more
affordable to boost sales. The company is reportedly developing a
comparatively cheaper car to make electric cars accessible to the
masses. This should help protect the company from competition
), which is developing a low-cost electric car that provides
better mileage than its Chevrolet Volt plug-in hybrid. While
Tesla's Model S covers 265 miles on a single charge, Volt
provides a mere 38 miles before shifting to gas.
Tesla is also launching a new SUV - Model X - in 2014. The
model scores high on style, with Falcon Wing doors, premium
interior surfaces, panoramic glass and Tesla Touchscreen
installed in the dashboard. It also boasts zero tail-pipe
emission and offers a 60 or 85 kWh battery. The car will have an
optional Dual Motor All-Wheel Drive, which will make it the
fastest SUV, with acceleration from 0 to 60 mph in less than 5
Meanwhile, Tesla has acquired a substantial market share for
Model S through its impressive design and enhanced performance.
In Aug 2013, the car won the top vehicle safety rating from the
National Highway Traffic Safety Administration (NHTSA). Model S
obtained a five-star rating overall and also for each of its
subcategories from NHTSA. This is a coveted award for Tesla as
only 1% of the cars tested receive the rating.
Tesla delivered 5,150 Model S cars in the second quarter of
2013, which surpassed its projection of 4,500 deliveries. The
company expects to deliver over 5,000 Model S vehicles in the
third quarter of 2013 and 21,000 vehicles globally in 2013.
Sales are expected to increase further once Model S becomes
available worldwide. Tesla is gradually working toward this goal.
The company recently opened an assembly and distribution center
in Netherlands, which will allow the automaker to transport parts
anywhere in Europe within 12 hours. Tesla also opened
reservations for Model S in China last month.
Tesla expects Model S sales to cross 40,000 by 2014, assuming
the demand in Asia and Europe to meet expectations. The car was
launched in the U.S. in 2013 and is also available in Europe.
Tesla designs and manufactures electric vehicles and electric
vehicle power train components for partners including
Toyota Motor Corp.
). The company currently carries a Zacks Rank #2 (Buy).
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