Here’s how Tesla’s battery-operated Model S jolted even the most jaded Wall Streeter yesterday:
* First-quarter sales are about 6 percent higher than expected
* Forecast for the year: 20,000 deliveries (
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Tesla CEO Elon Musk just played a bad joke on short sellers.
Shares of the electric-car company hit an all-time high on April Fool’s Day after Musk said — yet again — that Tesla was on track to report its first-ever profitable quarter.
The stock surged as much as 23 percent, to $46.68. It gave up some of those gains, closing up 16 percent at $43.93.
The Palo Alto, Calif., company has been promising to post a profit since last year, leading some industry observers to suggest that a “short squeeze” triggered by Musk’s relentlessly optimistic outlook was helping fuel the stock.
Since selling shares to the public in 2010, Tesla has attracted an outsized number of short sellers, or investors who are betting the stock will fall. As of last month, 32.3 million of Tesla’s 114 million shares outstanding were sold short.
“I think short covering has a large part to do with it,” said Ben Schuman, an analyst at Pacific Crest Securities, of Tesla’s Monday stock jump.
While the earning news was generally positive, “the fundamental impact is pretty minimal,” he added.
Yesterday, Tesla said it will report a pure profit, rather than a profit excluding certain charges, after vehicle deliveries exceeded expectations.
In total, deliveries of Tesla’s affordable sedan, the Model S, exceeded 4,750 units, compared to previous estimates of 4,500 units.
Tesla first announced plans to become profitable last year. In February, the company hammered home the point to shareholders, saying it expects to be “slightly profitable” at the end of the first quarter.
Tesla also announced plans to stop producing its cheapest version of the Model S, which costs just $60,000 after a $7,500 tax credit. Tesla cited the move to a “lack of demand,” saying only 4 percent of customers chose the 40 kWh battery-pack car.