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Tesla’s 2Q17 Earnings Review: What Triggered the Buying Spree?

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Tesla’s 2Q17 Earnings Review: What Triggered the Buying Spree? PART 1 OF 6

Why Tesla’s 2Q17 Results Sparked a Buying Spree

Tesla’s 2Q17 earnings

US electric carmaker Tesla (TSLA) released its 2Q17 earnings after the market closed on August 2, 2017. The company’s adjusted net loss for the quarter stood at $1.33 per share on a non-GAAP1 basis. These earnings were far better than the analysts’ estimate of a loss of $1.76 per share. TSLA’s 2Q17 GAAP net loss was $2.04 compared to its net loss of $2.09 per share in 2Q16.

Now, let’s take a quick look at how investors reacted to Tesla’s earnings report.

Why Tesla&#8217;s 2Q17 Results Sparked a Buying Spree

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Investors reacted positively

On the day of Tesla’s 2Q17 results, its stock traded on a positive note and closed at $325.89 per share with a gain of ~2.0% from the previous day’s closing price. This positive movement extended to the next session on August 3. Its stock rose ~6.5% to $347.09.

Positive YoY (year-over-year) growth in the company’s revenues and gross profit margins, along with high expectations from the Model 3, could be among the key reasons for this optimism on Wall Street. On August 3, Tesla stock rose ~62.4% on a year-to-date basis.

Among the mainstream automakers (XLY), General Motors (GM), Ford (F), and Fiat Chrysler Automobiles (FCAU) released their 2Q17 results in July.

Series overview

In this series, we’ll take a close look at Tesla’s 2Q17 earnings, revenues, and profitability. We’ll explore the factors that drove the company’s second quarter results this year.

We’ll also review Tesla’s updates on its Model 3. At the end of the series, we’ll take a look at some important factors that could be driving the company’s valuations in 3Q17.

  1. generally accepted accounting principles
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