Tesla Motors Inc. (TSLA) fell the most in six months after reporting car deliveries last quarter that trailed the highest analyst estimate amid battery-supply constraints and saying it faces a possible sales ban in Missouri.
Tesla tumbled 11 percent to $178.59 in New York after saying yesterday that supplies of the lithium-ion batteries used to power its Model S sedans will be tight until the second half. The decline was the biggest for the electric-car maker since Nov. 6 and pared the stock’s gain this year to 19 percent.
“Whereas investors had grown accustomed to Tesla providing delivery guidance ahead of expectations, the trend was broken” for the second quarter, Brian Johnson, a Barclays Plc analyst, said today in a report. The forecast will likely put the stock “in the penalty box in the near term,” said Johnson, who rates Tesla the equivalent of a hold.
Quarterly Model S deliveries rose to 6,457 cars from about 4,900 a year earlier, Tesla said yesterday. While that exceeded the average of seven analyst estimates, it was less than the highest forecast for as much as 6,600. Growth was held back by tight supply of lithium-ion cells for Tesla batteries, and that won’t ease until the third quarter, Chief Executive Officer Elon Musk said yesterday.
Tesla plans to deliver about 7,500 cars to customers in the second quarter. That’s below Johnson’s estimate of about 7,800, he said in the report.
Separately, the company said Missouri’s legislature is voting on a bill that includes wording that will prevent it from selling cars directly to consumers in the state if passed.
The “anti-Tesla” language was added to a state House bill that explicitly requires consumers to buy vehicles through franchise dealers, the company said in a statement. Missouri’s Senate passed the bill yesterday with no public comment or debate, according to Tesla.
“This extraordinary final-hour maneuver amounts to a sneak attack to thwart due process and hurt consumer freedom in Missouri,” the Palo Alto, California-based company said. New Jersey this year barred the company from selling the Model S at stores there, a decision Tesla is appealing. Texas and Arizona also prohibit sales at automaker-owned stores.
The company worked out arrangements with Ohio and New York this year to continue selling directly to customers in those states.
To address the battery issue, Tesla is scouting sites for a plant big enough to cut their production costs by 30 percent. Panasonic Corp. (6752), its main supplier of battery cells, has signed a letter of intent to join the “gigafactory” project, the company said yesterday.
“We’re actually quite comfortable that we’re heading toward a final agreement sometime later this year,” JB Straubel, Tesla’s chief technology officer, said on yesterday’s call to discuss earnings.
Groundbreaking could begin as early as next month, Musk said. Tesla has named Arizona, Nevada, New Mexico and Texas as possible factory sites and said it will break ground in at least two states. California is being looked at as another option, though its selection is “improbable,” he said. While Panasonic will be the only cell supplier at the factory, Tesla may buy cells from other suppliers, Musk said, without elaborating.
Chieko Gyobu, a Panasonic spokeswoman, confirmed the letter of intent by e-mail.
“We are talking to Tesla about joining the gigafactory,” Gyobu said. “We’ll discuss details going forward.”
Tesla reported first-quarter earnings of 12 cents a share, excluding some items. That matched the adjusted profit that the company reported a year earlier and exceeded the 7 cents-a-share profit average of estimates compiled by Bloomberg.
On a GAAP basis, Tesla said it lost 40 cents a share and said its net loss was $49.8 million, from a profit of $11.2 million a year earlier.
Tesla recorded a $2 million charge during the period to retrofit Model S battery packs with titanium shields for extra safety in the event of a crash. The automaker forecast a “slightly” negative cash flow for the year and said that operating expenses related to research and development will increase by about 30 percent this quarter. Such costs were $82 million on a GAAP basis and $68 million on a non-GAAP basis in the first quarter.
“Large sequential increases in operating expense” could put pressure on the shares today, Ryan Brinkman, an analyst with JPMorgan Chase & Co. wrote in a research note. He has the equivalent of a hold rating on the stock.
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