Ahead of the Bell: Tesla
NEW YORK (AP) — A Jefferies analyst on Wednesday cut her price target for electric car maker Tesla Motors Inc., citing the slower-than-expected ramp up of production of its new sedan.
Elaine Kwei backed her "Buy" rating for Tesla, but lowered her price target by $5 to $34, saying that the resulting reduction in Model S sales will cut into the company's 2012 and 2013 profits.
"We believe Tesla could become a longer-term story as the electric vehicle market develops; the next catalyst hinges upon volume shipments of the Model S," Kwei wrote in a note to investors.
In a Securities and Exchange Commission filing Tuesday, Tesla said it now expects its 2012 revenue to total between $400 million and $440 million, down from its previous prediction of $560 million to $600 million. Analysts, on average, were expecting $560.9 million in revenue for the year, according to FactSet.
The company also projected third-quarter revenue of $44 million to $46 million, well below analysts' average expectation for $86.6 million.
Tesla said it has increased Model S production at a slower rate than previously expected, partially as a result of delivery delays involving some of its key suppliers. The company said it expects to deliver between 200 and 225 Model S vehicles during the third quarter and another 2,500 to 3,000 during the fourth quarter.
Kwei said she thinks the lower shipments were already at least partially factored in to Wall Street's expectations for Tesla's stock. She noted that her current expectations are based on 2012 Model S deliveries of 3,085 vehicles and 2013 deliveries of 18,500 vehicles.
Tesla shares fell 19 cents to $27.47 in premarket trading Wednesday. Its shares are down from a 52-week high of $39.95 in late March. They traded as low as $22.64 on Jan. 13.