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Tesla's Turning Point matches Elis Muskys Hubris



Controversial Tesla CEO Elon Musk has finally had a PR victory to match his brazen and often caustic public persona.

At a time, the Tesla share (TSLA) was above seven percent in yesterday's shortened trading session, which the Company set new delivery and production records.

TSLA was closed at $ 234.90 for a gain of 4.61%.

  Tesla share price (TSLA) chart.
TSLAs July 3 was cherry on top of a bullish month for the besieged stock. | Source: Yahoo Finance

Tesla puts record and wowing investors

Tesla smashed production and delivery records into what Loup Ventures & # 39; Gene Munster says, marks a "turning point" for the automaker.

The electric car manufacturer managed to beat previous record and analyst estimates in Q2 2019, delivering 92,500 cars for the quarter ending June 30, producing 87,048 units. The previous delivery record was 90,700 back in the fourth quarter of 2018. The last quarter disappointed the company and delivered only 63,000 cars.

The company's delivery and production results suggested expectations for a strong third quarter, with a demand for orders already hanging up. Device deliveries are used by analysts as a proxy for sales. 92,500 deliveries exceeded forecasts of $ 91,000.

With fear of falling demand for Tesla vehicles and controversy around the alleged hubris of CEO Elon Musk, many analysts feared that the car manufacturer would face short-term problems, which were swept aside by The company's recent announcement.

Wedbush analyst Dan Ives told CNBC:

"Challenges remain, but this is a step in the right direction. The figures were above even the bullet estimates and shows a clear decline for the company. This is a feather in Tesla's hat. "

The road ahead remains plagued by uncertainty

  tesla sign
Elon Musk beat the odds in the quarter, but Tesla is still plagued by tough challenges for months and years to come. | Source: REUTERS / Mike Blake

These The challenges are likely to come from competition into the market as older car manufacturers enter the market for electric vehicles, especially at the premium end.

Ford and Jaguar have already invested billions developing electric car models. Volkswagen and Mercedes-Benz have already begun to take orders for long distance electric cars.

Tesla told investors in its announcement:

"In addition, we have made significant progress in streamlining our global logistics and delivery operations in higher volumes, allowing cost efficiency and improvements in our working capital position. "

Flaggenship Model 3 was easily the largest seller, delivering Q2 77,550, more than three thousand units over estimates. Ives warns that the company must prove its sustainability to investors, especially in the face of competition and high production targets. , as Ives noticed:

"… still an Everest task, especially with competition coming from them from all angles. The real question is going to be, is this sustainable? "

Even after his month-long rally, Tesla's stock is down by almost a third over the past year, and is currently valued at just under $ 42 billion.

The issue of borrowing an expression from Wedbush's Ives , is whether Tesla's sudden breakthrough is sustainable.

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