Zacks Investment Research upgraded shares of Tesla Motors, Inc. (TSLA) from UNDERPERFORM to NEUTRAL on October 08, 2014, with a target price of $273.00.
We are upgrading Tesla to Neutral from Underperform, based on rising sales, rapid international expansion, improving production rate and continued investment in infrastructure and product development. The Gigafactory construction is also expected to be favorable in the long term. However, continuous losses, high research and development (R&D) and selling, general and administrative (SG&A) expenses, and production constraints such as shortage of battery supply are headwinds. Tesla is also facing opposition to its direct-selling model in some U.S. states. The company reported adjusted loss of $0.14 per share in the second quarter of 2014, deteriorating from adjusted income of $0.05 recorded in the year-ago quarter. The loss was narrower than the Zacks Consensus Estimate of a loss of $0.24.
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