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Tesla’s S&P 500 Inclusion Hinges on Earnings Quality: DataTrek

  • Profit powered by credit revenue puts index managers in a bind
  • Helping carmakers on compliance has been pivotal to earnings
Photographer: Andrey Rudakov/Bloomberg
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Tesla Inc. has posted four quarters of positive earnings. That’s enough to get it into the S&P 500, right? Not necessarily, says DataTrek Research.

Fans of Elon Musk’s automaker have been on high alert for news Tesla will be added to the index ever since the company reported a $104 million profit for its June quarter. But while the results would seem to satisfy rules for inclusion, aspects of its earnings may give the index committee at S&P Dow Jones Indices pause, the research shop said.