Tesla Inc (NASDAQ: TSLA) is having an overwhelmingly strong start to the trading session this morning, and for good reason. A highly trusted firm announced that they see meaningful evidence of growth in Model 3 volumes. Of course, the news excited investors, sending the stock on a run for the top. Today, we’ll talk about:
- The expectations of increased Model 3 sales;
- what we’re seeing from TSLA as a result; and
- what we’ll be watching for ahead.
TSLA Heads Up On KeyBanc Capital Note
As mentioned above, Tesla is having an incredibly strong start to the trading session this morning after KeyBanc Capital weighed in on the stock. In a recent note, the firm increased its revenue expectations for the current quarter. In the note KeyBanc Capital says that it sees a evidence of a meaningful ramp in Model 3 volumes. The firm said that this evidence is based on conversations with 20 sales centers across the United States, which represents 18% of the total sales centers. Here’s a key snippet from the note analyst Brad Erikson wrote surrounding TSLA:
Based on our conversations with 20 sales centers across the U.S. (18% of total), we believe weekly run-rate volumes have moved from the high teens per store per week to the low 30s since our last checks in April… With three weeks to go in the quarter, we estimate the company is tracking to something between 30,000 and 35,000 Model 3 deliveries in the quarter versus our prior view of 20,000-25,000.
As a result of the expected ramp in Model 3 sales, the analyst increased revenue estimates from $3.91 billion to $4.37 billion for the current quarter. The new figure is well ahead of the FactSet consensus of $4.23 billion.
What We’re Seeing From The Stock
As investors, one of the first lessons that we learn is that the news moves the market. In the case of Tesla, the news proved to be overwhelmingly positive. With increased sales expected surrounding the Model 3, one highly trusted analyst is expecting to see strong revenue growth in the current quarter. So, it’s no surprise that excited investors are following his lead, sending the stock on a run for the top. At the moment (9:32), TSLA is tradinga t $343.00 per share after a gain of $10.90 per share or 3.28% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on TSLA. In particular, we’re interested in following the story surrounding the company’s sales to see if the expected growth will actually take place. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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