Tesla's (TSLA) Q4 Results Seen as 'Mixed Bag' but Outlook Should Allay Concerns - Deutsche Bank

Deutsche Bank analyst Rod Lache called Tesla's (TSLA) Q4 results and "mixed bag," but he thinks outlook will allay near term concerns. Lache is constructive on Tesla's long term potential but maintained a Hold rating on the stock given risks, including execution.

"Execution was somewhat disappointing, as results were negatively affected by the slower than expected ramp up of the Model X, and significantly higher than expected OpEx. That said Street expectations have clearly turned cautious. And in this context, investors should react favorably to new disclosures about demand trends, underlying margins, the manufacturing ramp, cash flow guidance (the need for a capital raise is diminishing), and the timing of the Model 3 launch," said Lache.

"We maintain a constructive stance on TSLA’s long term potential, as we believe in the cost convergence of Electrification vs. Internal Combustion, we believe that Tesla will be in a strong position as this phenomenon becomes more apparent, and we believe that demand for Tesla’s upcoming products could dwarf expectations. That said, our neutral stance reflects significant execution risks (Including uncertainty over what happens to Model S demand after the lower cost Model 3 is revealed)," added the analyst.

For an analyst ratings summary and ratings history on Tesla Motors click here. For more ratings news on Tesla Motors click here.

Shares of Tesla Motors closed at $143.67 yesterday.

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