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Why Tesla Motors Inc. Stock Took Off

By Jeremy Bowman - Feb 20, 2014 at 2:14PM

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

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 (TSLA 4.88%) 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. 

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