Tesla Motors Inc.
) kept its promise of paying off the $465 million U.S. Department
of Energy (DOE) early and its actually turned out much earlier!
The electric carmaker received the loan in Jan 2010 and agreed on
a 10-year repayment program. However, the situation became so
much favorable that the company repaid the full outstanding
amount of the loan in the second installment itself.
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Last December, Tesla made its first DOE loan repayment of nearly
$13 million. Yesterday, the company paid off the remaining $451.8
million using the near-$1 billion proceeds from the common stock
and convertible senior note offering made last week.
Tesla's share prices started soaring following the reports of its
first-ever quarterly profit on May 8. After the earnings release,
share price surged as much as 57.2%.
On May 14, Tesla shares hit new 52-week high of $97.12, which is
above its previous level of $88.00 a day before. The last closing
price of $87.24 represented a whopping one-year return of 183.2%
and year-to-date return of 146.7%.
Last week, Tesla offered 2.7 million shares and $450 million in
convertible debt due in 2018. Tesla had also given a 30-day
option to its underwriters to buy an additional 405,454 common
shares and $67.5 million in notes.
Tesla's chief executive officer and cofounder Elon Musk plans to
purchase $100 million worth of shares at the same public
offering. Currently, Musk holds about 27 million shares of Tesla,
which is equivalent to roughly 24% of the company's outstanding
In 2012, Tesla lost $396.2 million or $3.69 per share compared
with $254.4 million or $2.53 per share in 2011. Due to a good
start in 2013, the company had expected to repay its DOE loan
much earlier and boost production of vehicles to lower production
Tesla reported its first-ever quarterly profit of $15.4 million,
or 12 cents per share (on an adjusted basis) in the first quarter
of 2013 compared with a loss of $79.3 million or 76 cents in the
corresponding quarter of 2012. This indicated a whopping positive
earnings surprise of 271.4% given the Zacks Consensus Estimate of
a loss of 7 cents for the quarter.
Revenues jumped manifold to $561.8 million from $30.2 million in
the first quarter of 2012. Thanks to the impressive 5,000 units
of Model S electric car sales during the quarter.
The automaker continued to supply full electric powertrains and
battery packs to
Toyota Motor Corp.
) for their RAV4 EV program. It also completed various
) Mercedes Benz B-Class EV program, which contributed to total
development services revenues of nearly $7 million.
Tesla expects to manufacture 5,000 Model S vehicles in the second
quarter of the year. For full year 2013, the company expects to
deliver 21,000 Model S cars globally, up 5% from its prior
guidance of 20,000 units.
Shares of Tesla retain a Zacks Rank #3, which implies a
short-term (one to three months) Hold rating. Currently,
) with Zacks Rank #2 (Buy) is performing well in the broader