Despite announcing misses for both earnings and revenue yesterday, Tesla Motors TSLA is soaring today, with shares prices up nearly 7.5% in morning trading. Today's action is being driven by the company's positive outlook for 2016.
Initially, it looked like a bad earnings report for Tesla. The company missed on earnings by a wide margin, reporting an adjusted EPS of -$1.29 against the Zacks Consensus Estimate of -$0.34. Revenues missed on a narrower margin, with Tesla reporting $1.75 billion against the estimated $1.78 billion.
Nevertheless, the stock climbed due to the amount of auto deliveries in 2015, and more importantly, the company's projections for 2016. Tesla delivered 17,272 Model S Cars, which was up 79% year over year and above expectations, and 206 Model X SUVs, which was right in-line.
Furthermore, Tesla expects total deliveries of 80-90K in 2016, which reaffirms sales growth of 60%-80% and represents sales of about 1600-1800 cars per week. The company's lithium ion producing Gigafactory is also on schedule.
Tesla's total sales projections should be guided by the release of its new Model 3 car on March 31, 2016. With a starting price of $35,000, not including clean energy benefits, the Model 3 is a much more affordable Tesla and should appeal to a wider audience.
Although Tesla has been in a rough patch, this outlook is an important piece of positive news. Today's trading activity indicates that investors are excited about what the future holds for the company.