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Tesla (TSLA): Will it Report Loss this Earnings Season? - Analyst Blog

Tesla Motors, Inc.TSLA is set to report first-quarter 2015 results on May 6. In the last quarter, this electric carmaker had posted a negative earnings surprise. Let us see how things are shaping up for this announcement.

Factors Influencing this Quarter

Tesla delivered 10,030 vehicles in the first quarter of 2015, representing an impressive 55% improvement over the first quarter of 2014. This is a record high for Tesla and should translate into strong revenues for the quarter.

Despite increasing sales, Tesla still remains a loss-making company due to high expenses. Operating expenses are projected to rise approximately 10% sequentially in the first quarter of 2015. Thus, we can expect the company to report losses in the first quarter as well.

Earnings Whispers

Our proven model does not conclusively show that Tesla is likely to beat estimates this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1, 2 or 3 for this to happen. This is not the case here, as you will see below:

Zacks ESP: Tesla has an Earnings ESP of 0.00%. This is because the Most Accurate estimate and the Zacks Consensus Estimate both currently stand at a loss of 81 cents.

Zacks Rank: Tesla currently carries a Zacks Rank #3 (Hold). Though a Zacks Rank #3 increases the predictive power of ESP, the company's ESP of 0.00% makes surprise prediction difficult.

We caution against stocks with a Zacks Rank #4 and 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

Stocks to Consider

Metaldyne Performance Group Inc. MPG , with an Earnings ESP of +5.41% and a Zacks Rank #3, is a stock in the auto sector that is expected to beat earnings this season. The company will report first-quarter 2015 earnings on May 7.

SORL Auto Parts, Inc. SORL will release first-quarter 2015 results on May 15. The company sports a Zacks Rank #1 (Strong Buy).

Power Solutions International, Inc. PSIX will post first-quarter 2015 results on May 7. The company has a Zacks Rank #2 (Buy).

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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