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On 29th January 2020, Tesla Inc announced its second consecutive quarterly profit after registering record vehicles sales. The company stated that it would manufacture over 0.5 million units in the year 2020, as the electric carmakerâs shares scaled a new peak. The company noted that its new Shanghai factory is performing as per the management expectations, and it would try to increase the production of Model â3â, which is its go-to-market model, due to robust requirement in China.
As per media report, Shanghai factory, which is valued at $2 billion, is the mainstay of the companyâs strategy, where it aims to deliver around 150,000 Model 3 sedans and later boost production to around 250,000 in a year, which also includes the new Model Y. But because of quickly spreading coronavirus which China is trying to neutralize, Tesla Inc. anticipates a little interruption of around one and a half weeks in the ramp-up of the Shanghai-constructed Model 3 due to a government-mandated factory shutdown.
After this huge sale news, the share price of the company closed at USD 572 on 29th January 2020, which increased by 2.06% as compared to the previous day close, i.e. USD 560.45 on 28th January 2020. It was also the first time in the history that the stock touched $600 mark as Tesla Inc pledged to âeasily exceedâ half a million units. However, as per media report, it helped the company to increase its delivery by more than a third as compared to the 367,500 units it distributed in the year 2018.
According to the company information, in January 2020, it has begun the production of its new car Model Y which is an electric utility vehicle at its Fremont plant in California. The company is planning to provide the first models by the end of March 2020. Craig Irwin, analyst at Roth Capital Partners, stated that Tesla Inc. has already commenced production of Model Y.
Investors know that Tesla Inc. has seen through many ups and downs and can compete with better and larger competitors to lead the automobile industry on technological evolution for the next generation of cars. As per the company, the high manufacturing volumes and cost efficiencies should help the company to achieve industry-leading operating margins. However, Tesla Incâs cost efficiencies become evident when comparing profit and sale revenue on a per-car-basis. Teslaâs results revealed that after revenue increased by 3 per cent on a quarterly basis in the most recent quarter of 2019, the operating profits per vehicle increased by approximately 19 per cent in the same period.
According to the recent financial results of the company, it said in its report that cash at hand rose to $6.3 billion. At the same time, Teslaâs debt was steady and amounted to $13.42 billion at the end of the year 2019. The company has been targeting to pare costs. Â But its new projects, which involve the building of its first manufacturing facility in Europe (Germany) for a new generation of the Tesla Roadster, an electric truck and automated driving features, are likely to stretch its cash resources.
As per the media report, the company would ramp up battery production capacities in the year 2020, so that it is capable of manufacturing more vehicles.
Overview of Tesla Inc.
Tesla, Inc. (LON:0R0X) was known as Tesla Motors, Inc. previously, which designs, sells, produces and develops fully electric cars, and power storage systems, as well as installs, maintains and operates solar power storage products. The company aim is to speed up the worldâs switch to a viable energy platform. Since the foundation of the company in the year 2003, Tesla has achieved goals in the form of developing emerging high-performance vehicles. It is not only the worldâs highest-selling pure electric vehicles but also the highest-rated cars which are the safest on the road worldwide.
0R0X â Financial Highlights
On 29th January 2020, the company announced its unaudited fourth quarter and fiscal year updates for the three months and full year ending 31st December 2019, respectively.
The total revenue in the fourth quarter of financial year 2019 increased to $7,384 million as compared to $6,303 million in the 3rd quarter of financial year 2019. The gross profit increased to $1,391 million in the fourth quarter of financial year 2019 as compared to $1,191 million in the 3rd quarter of Financial year 2019.
The income (loss) before income taxes in the fourth quarter of financial year 2019 decreased marginally to $174 million as compared to $176 million in the third quarter of financial year 2019. The net income also decreased marginally to $132 million in the fourth quarter of financial year 2019 as compared to $150 million in the third quarter of the financial year 2019. The net income (loss) attributable to common stockholders decreased to $105 million in the fourth quarter of financial year 2019 as compared to $143 million in the third quarter of the financial year 2019.
The companyâs full-year revenue increased to $24,578 million in the year 2019 as compared to $21,461 million in the year 2018. In contrast, the total automotive cost of revenues also increased to $16,398 million in the year 2019 as compared to $14,174 million in the year 2018. The total cost of revenues increased to $20,509 million in the year 2019 as compared to $17,419 million in the year 2018.
The total operating expenses for the full year 2019 decreased to $4,138 million as compared to $4,430 million in the year 2018. The income (loss) before income taxes increased to ($665) million in the year 2019 as compared to ($1,005) million in the year 2018. Net income (loss) increased to ($775) million in the year 2019 as compared to ($1,063) million in the year 2018.
The basic and diluted (loss) per share increased to (4.92) cents in the year 2019 as compared to the (5.72) cents in the year 2018.
 (Sources: Company Websites)
0R0X â Share Price Performance
At the time of writing, on 31st January 2020 as at 08:00 AM (GMT), the stock of 0R0X was trading at USD 671.50 per share on the London Stock Exchange, higher by of 4.91 per cent or USD 31.45 per share, versus previous dayâs closing price of USD 640.05 per share.
The companyâs market capitalisation was reported at $115.50 billion at the time of writing. The free float and shares outstanding of 0ROX were reported at 142.47 million and 180.24 million, respectively.
0ROXâs share price of USD 671.50 as on 31st January 2020 was its 1-year peak price, whereas the share price of USD 177.85 as on 03rd June 2019 was the 1-year low share price. The current share price was higher by 277.56 per cent from the 1-year low price.
The beta of the stock of the company has been reported at a value of 0.66, which means that 0R0X stock has shown lower volatility in its movement, as compared to the volatility of the comparative index in the last twelve months.
On 30th January 2020 as at 21:00 (GMT), the stock of TSLA (NASDAQ) was closed at USD 640.81 per share on the NASDAQ, higher by of 10.30 per cent or USD 59.82 per share.
