We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Musk & His Models: What's New at Tesla Shareholders Meeting?
Read MoreHide Full Article
Elon Musk, with his clean energy goals and sky-high ambitions, charmed investors once again at the annual shareholder meeting.
But before that, they cleared the way by ratifying regular board proposals and voting against the Connecticut Retirement Plans and Trust Fund’s proposal to declassify the board, which would then necessitate an annual election of all directors.
The proposer said that classified boards hampered the ability of shareholders to hold directors accountable since not all directors are elected every year. Tesla’s (TSLA - Free Report) board said that a continuity factor in the board was essential to carry out long-term initiatives and create shareholder value.
Musk took the stage thereafter answering Twitter questions and in the process updating investors about Tesla’s cars, truck, self-driving technology, manufacturing lines, etc.
The electric cars were of course of greatest interest. In that respect, Musk said that Model 3 production was on track to start next month and that the configurator would go live about then for those who have already booked. There aren’t too many options at the moment though (just color and wheel size) because the idea is to keep it simple so it’s easier to do greater volumes. It isn’t easy buying a Tesla and if you book one today, it won’t be until the end of 2018 that it’s delivered. Clearly, that isn’t an ideal situation and something the company would like to change.
As far as the crossover Model Y is concerned, Tesla did display a glimpse that was more of a tease than a revelation. The car, which will be somewhere between the Model X and the Model 3 in size, is expected to be available in 2019. Musk said it would be built on a new platform not only because the Fremont factory is running at full capacity but also because of the new architecture being employed. He admitted that it was a mistake to have built the high-end Model X on the more affordable Model S sedan design because it increased complexities and consumed more capital. The Y is expected to be twice as popular as the Model 3.
The thus-far-unnamed heavy-duty, long-range, electric truck will be unveiled in September. Tesla has been collaborating with prospective trucking customers to make sure that it’s built with their needs in mind. Because of the collaborations, the company wouldn’t need to go hunting for customers when the product is ready to ship, roughly two years from now. It will instead focus on the number of trucks to be shipped. Musk also hinted that there would be other announcements at the truck launch event.
Since the fallout with Mobileye over the driver who died at the wheel of its self-driving test car, the company has been working on its own Autopilot technology. Musk was optimistic that internal efforts (software and hardware) had yielded a product that was now set to eclipse the technology initially bought from Mobileye. Further development is expected to be smoother and quicker.
Conclusion
Electric car adoption will depend on things like availability and choice, but charging stations are also a factor. Tesla said it will be increasing the number of supercharging locations. There will also be improvements to the car battery that may encourage people to upgrade. Since Teslas are said to be highly resilient to accidents, a customer will probably be able to turn over an older car for a newer iteration. The company intends to deal in used cars as well, so this may be how it will be building its stock/fleet.
For now, the focus remains on chugging out the volumes.
Recommendation
Tesla shares carry a Zacks Rank #4 (Sell), with the main concern about them being the high valuation. The shares have appreciated 44% in the last 3 months compared to the S&P 500’s 3.0%. Peers Fox Factory Holding Corp. (FOXF - Free Report) and PACCAR, Inc. (PCAR - Free Report) are better buys, as both carry a Zacks Rank #2 (Buy). FOXF’s appreciation has been more reasonable at 15.0% while PCAR has dropped 6.5%.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look. See the pot trades we're targeting>>
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Musk & His Models: What's New at Tesla Shareholders Meeting?
Elon Musk, with his clean energy goals and sky-high ambitions, charmed investors once again at the annual shareholder meeting.
But before that, they cleared the way by ratifying regular board proposals and voting against the Connecticut Retirement Plans and Trust Fund’s proposal to declassify the board, which would then necessitate an annual election of all directors.
The proposer said that classified boards hampered the ability of shareholders to hold directors accountable since not all directors are elected every year. Tesla’s (TSLA - Free Report) board said that a continuity factor in the board was essential to carry out long-term initiatives and create shareholder value.
Musk took the stage thereafter answering Twitter questions and in the process updating investors about Tesla’s cars, truck, self-driving technology, manufacturing lines, etc.
The electric cars were of course of greatest interest. In that respect, Musk said that Model 3 production was on track to start next month and that the configurator would go live about then for those who have already booked. There aren’t too many options at the moment though (just color and wheel size) because the idea is to keep it simple so it’s easier to do greater volumes. It isn’t easy buying a Tesla and if you book one today, it won’t be until the end of 2018 that it’s delivered. Clearly, that isn’t an ideal situation and something the company would like to change.
As far as the crossover Model Y is concerned, Tesla did display a glimpse that was more of a tease than a revelation. The car, which will be somewhere between the Model X and the Model 3 in size, is expected to be available in 2019. Musk said it would be built on a new platform not only because the Fremont factory is running at full capacity but also because of the new architecture being employed. He admitted that it was a mistake to have built the high-end Model X on the more affordable Model S sedan design because it increased complexities and consumed more capital. The Y is expected to be twice as popular as the Model 3.
The thus-far-unnamed heavy-duty, long-range, electric truck will be unveiled in September. Tesla has been collaborating with prospective trucking customers to make sure that it’s built with their needs in mind. Because of the collaborations, the company wouldn’t need to go hunting for customers when the product is ready to ship, roughly two years from now. It will instead focus on the number of trucks to be shipped. Musk also hinted that there would be other announcements at the truck launch event.
Since the fallout with Mobileye over the driver who died at the wheel of its self-driving test car, the company has been working on its own Autopilot technology. Musk was optimistic that internal efforts (software and hardware) had yielded a product that was now set to eclipse the technology initially bought from Mobileye. Further development is expected to be smoother and quicker.
Conclusion
Electric car adoption will depend on things like availability and choice, but charging stations are also a factor. Tesla said it will be increasing the number of supercharging locations. There will also be improvements to the car battery that may encourage people to upgrade. Since Teslas are said to be highly resilient to accidents, a customer will probably be able to turn over an older car for a newer iteration. The company intends to deal in used cars as well, so this may be how it will be building its stock/fleet.
For now, the focus remains on chugging out the volumes.
Recommendation
Tesla shares carry a Zacks Rank #4 (Sell), with the main concern about them being the high valuation. The shares have appreciated 44% in the last 3 months compared to the S&P 500’s 3.0%. Peers Fox Factory Holding Corp. (FOXF - Free Report) and PACCAR, Inc. (PCAR - Free Report) are better buys, as both carry a Zacks Rank #2 (Buy). FOXF’s appreciation has been more reasonable at 15.0% while PCAR has dropped 6.5%.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look. See the pot trades we're targeting>>