Tesla Motors Inc. Stock Jumps on Big Numbers at Detroit Auto Show

This morning Tesla (NASDAQ: TSLA  ) shares jumped about 10% at the time of this writing. What's the backstory? The company shared some important updates at this week's Detroit Auto Show: Q4 vehicle sales and an update on its next big project, the Model X.

Model S

A Q4 update
Vice president of worldwide sales Jerome Guillen told the audience in Detroit that Tesla delivered 6,900 vehicles in the fourth quarter of 2013.

Source: Data retrieved from SEC filings and press releases

The number was somewhat of a surprise, considering that Tesla only guided for "slightly under 6,000 Model S vehicles." Assuming estimates for 5,900, Tesla's Q4 deliveries beat guidance by about 17%. That's Tesla's largest surprise for Model S deliveries ever -- by a solid margin.

Quarter

Guidance

Actual

Surprise Factor

Q1 2013

4,500 vehicles

4,900 vehicles

8.80%

Q2 2013

5,000 vehicles

5,150 vehicles

3.0%

Q3 2013

Slightly over 5,000

5,500

About 6.0%

Q4 2013

Slightly under 6,000

6,900

About 17.0%

Q3 and Q4 Model S deliveries in 2012 are not included in chart above. In both quarters, Tesla missed guidance. Source: SEC filings and press releases

"The two key drivers of demand were the superlative safety record of the Model S and great performance under extremely cold conditions," Tesla said in a press release this morning.

The Model S, heralded as the safest vehicle ever tested in the U.S., has helped Tesla continue its track record as the only manufacturer with "a perfect safety record of zero deaths or serious, permanent injuries ever." Including the Roadster, Tesla vehicles now boast a cumulative 200 million miles driven.

During the winter, Tesla did its best to educate consumers about the effectiveness of the Model S in winter conditions.

A Model X update
MLive asserts Guillen also claimed that the company is working "vigorously" on the Model X. The company plans to begin deliveries of the Model X in late 2014 in limited quantities, with a larger rollout in 2015. It's too late, however, for consumers to lock in a 2014 delivery, according to Tesla's website, which says the delivery estimate for new reservations is 2015. 

The Model X is described as an SUV, though Tesla claims that it blends "the best of an SUV with the benefits of a minivan, as only an electric car can."

What's next for Tesla?
Though the jump in the stock price on this news signals greater optimism in the market for Tesla stock, the upside surprise does little to impact a long-term-investment thesis for Tesla stock. The market's optimism already prices in a stellar 2014 and a successful launch of the company's affordable vehicle, which has an estimated timeframe of 2016 or 2017. 

That said, it's critical Tesla continues to exceed investors' expectations in production. As a supply-limited company with audacious goals for eventual mass-market appeal, Tesla's meaningful jump in production in Q4 shows investors the company is successfully addressing bottlenecks.

Though I won't be adjusting my investment thesis for Tesla stock on this news, it does give me a tad more confidence that the company is poised to continue to execute on levels that meet or exceed the market's expectations.

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Read/Post Comments (6) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On January 14, 2014, at 2:14 PM, Ustauber wrote:

    Thxtsla

  • Report this Comment On January 14, 2014, at 3:44 PM, steinson wrote:

    Te$la

  • Report this Comment On January 14, 2014, at 3:51 PM, Andion79 wrote:

    "The company plans to begin deliveries of the Model S in late 2014 in limited quantities, with a larger rollout in 2015."

    I believe that should be Model X, not S.

  • Report this Comment On January 14, 2014, at 5:33 PM, jetamerica wrote:

    Reality check-Ford sold about 6.2 million vehicles worldwide 2013-TSLA, maybe 23,000 and maybe 41,000 in 2014. Ford market cap is $64.5 Bil with sales of $180 Bil. or 0.33% of annual sales. TSLA market cap of $20 bil. with TTM sales of $1.7 Bil. or almost 12 times annual sales. Ford makes about $6 bil. in after tax profits and TSLA loses about $140 million.. It may be worth a premium over Ford-perhaps a market cap of 1 times sales, not close to 12.

    Round it up and that is a $2 billion market cap and a $26 stock price.

    I am hoping to see TSLA stock hit $170 to add to my short position. I think it is a good company and worth least $40 a share by 2019 IF they execute perfectly and grow at least 50% anually with profits for the next 5 years.

    They are way ahead of themselves and the hype is what is keeping the stock up .Average Ford vehicle sells for for about $30,000 not $80,000-greater appeal to a larger share of the market.

  • Report this Comment On January 14, 2014, at 7:16 PM, Ustauber wrote:

    You are very ignorant to compare Tesla with Ford.

    Can you please tell me how many cars has Ford recalled last year.

    Lol

  • Report this Comment On January 15, 2014, at 2:04 AM, damilkman wrote:

    I do not think recalls really matter. I will do a router vendor example. Back in late 90ties when Juniper was first beginning they used to have wonderful code and a great track record on few bugs and bugs not being reintroduced. It was easy for Juniper to look better than Cisco because JUNO's was built only to support the ISP market while Cisco IOS had to support ISP + enterprise. When the Internet bubble burst and Juniper decided they better support enterprise services aka more diversification, their bug rate increased and their resolution rate slowed down.

    The moral of the story is if you do one thing it is easy. Tesla sells a limited number of high end devices, with limited options, on one product line. Works great for the luxury market. Lets see what Telsa does when they have to support multiple products. Can they stay focused like Honda, or will their be option creep?

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