Tesla Shares Jump 3.8% Premarket After CEO Elon Musk Says 'quite Likely' It Will Meet Model 3 Production Goals -- MarketWatch
8:43 am ET June 6, 2018 (MarketWatch)
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Tesla Inc. shares (TSLA) surged almost 4% premarket Wednesday, after Chief Executive Elon Musk told shareholders at the company's annual meeting that it is "quite likely" it will meet its 5,000 a week production target for the Model 3. Baird analyst Ben Kallo reiterated his outperform rating on the stock and said news that Tesla expects to achieve positive GAAP net income and cash flow in the third and fourth quarters was a highlight. "While we do not model GAAP profitability for conservatism, we believe TSLA will be able to achieve sustainable operating cash flow and operating profit in the intermediate-term, which would be a significant catalyst, in our opinion," Kallo wrote in a note. Shareholders approved the re-election of the board of directors by a significant margin, "which we believe provides a vote of confidence in management," he wrote. Baird is upbeat on the company's energy storage opportunity, which may be underappreciated by some investors, he said. Tesla shares have fallen 6.5% in 2018 so far, while the S&P 500 has gained 2.8%.
