Shares of Tesla Motors Inc. rose more than 8 percent Monday after an analyst upgraded them and said production of the company's Model S sedan is "at or ahead of schedule."
THE SPARK: Wunderlich Securities analyst Theodore O'Neill raised his rating on Tesla shares to "buy" from "hold" and his price target to $49 from $30. O'Neill said he got a tour of Tesla's corporate headquarters and its California factory on Friday. Tesla is planning to make 5,000 vehicles in 2012, but O'Neill said the company may be able to surpass that goal.
Tesla eventually aims to produce 20,000 of the cars per year.
"There is no reason from a production standpoint why it can't immediately ramp to 5,000 cars per quarter," he wrote. "The electric car is significantly simpler to produce than a regular car. It will only be limited by components in the supply chain."
O'Neill added that he no longer thinks Tesla will need to raise money in 2013.
THE BIG PICTURE: The Palo Alto, Calif., company currently sells the $109,000 Roadster. This summer, it plans to start selling the Model S, a four-door sedan that is supposed to cost about half as much and thus appeal to more buyers. Tesla says most of its 2012 revenue will come from the Model S.
Analysts expect the company to report $561.4 million in revenue for the year, according to FactSet.
SHARE ACTION: Tesla Motors shares were up $2.80, or 8.2 percent, trading by midday at $36.88. The stock has risen 19.3 percent since the start of 2012.
http://www.businessweek.com/ap/2012-03/D9TO9LP81.htm