Why Tesla Motors Inc. Stock Took Off

Tesla Motors jumped after reporting earnings last night. Here's what you need to know:

Feb 20, 2014 at 2:14PM

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Tesla Motors (NASDAQ:TSLA) were soaring once again today, gaining as much as 11% after beating estimates in its earnings report. 

So what: The electric-car maker posted a per-share profit of $0.33 against expectations of $0.21, while adjusted revenue shot up 149% to $761.3 million, much better than the consensus at $684 million. Even better was the company's outlook for 2014 as it now expects to sell 35,000 Model S Sedans, up from a previous projection of 29,000, which would be a 55% improvement from 2013. Tesla also said production should improve from 600 cars per week to 1,000 cars per week, curbing concerns on that front.  

Now what: The electric-car juggernaut will also see its global footprint expand with its first Model S deliveries to China this spring, along with further investments in its Supercharger network and service centers in the world's most populous country. Its Beijing outlet is already its largest and most active location in the world, indicating that sales could easily double or triple once it opens up that market. While it's clear that Tesla the company is firing on all cylinders, the stock still has its naysayers as it carries a high price tag at a forward of P/E of 70. Still, if the company continues to beat estimates like this, shares will only move higher. 

What will be this year's Tesla?
Tesla was one of the market's best-performing stocks last year, but it's unlikely to see a repeat performance in 2014. If you're looking for a stock that's poised to pop this year, check out the Motley Fool's chief investment officer's No. 1 stock for 2014. Like Tesla last year, it's one of those investments that could make you rich. You can find out which one it is in the special free report "The Motley Fool's Top Stock for 2014." Just click here to access the report and find out the name of this under-the-radar company.

Jeremy Bowman has no position in any stocks mentioned. The Motley Fool recommends Tesla Motors. The Motley Fool owns shares of Tesla Motors. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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