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Why Tesla (TSLA) Hit an All-Time High Today (Update)

Update (4:15 p.m.): Updated with closing price, all-time high price, one-day low price and volume information.

NEW YORK (TheStreet) -- Tesla Motors  (TSLA) hit an all-time high of $199.30 on Monday as public perception of the electric automaker has brightened and after China decided to extend electronic vehicle subsidies.

"Even though Tesla's in no position to mass produce Chinese cars, it just doesn't matter. The thesis is simply too positive NOT to buy Tesla," said TheStreet founder Jim Cramer on RealMoney. "Next thing you know the stock takes out its high and you have a technical reason to own Tesla."

Consumer Reports ranked Tesla fifth last week in its annual Car-Brand Perception Survey, a list that has been stable for several years; Toyota, HondaFord  (F) and Chevrolet (GM) have been the top four brands in the survey since 2009, while Toyota, Ford and Honda have been the top three since 2008.

The automobile shopping website iSeeCars.com also conducted a survey that concluded that a used Tesla Model S with a base price of $79,900 is worth an average of $99,734 used; furthermore, a Model S with a long-range 85 kilowatt-hour battery pack is worth up to $106,800. Other electric cars, such as the Chevy Volt hybrid and Nissan Leaf, lose value once purchased.

Tesla sold 6,900 Model S cars in the final three months of 2013, which marked a 20% increase from the estimate Tesla gave in its third-quarter report in November.

The stock closed at $196.50, a 5.34% or $9.97 increase from its previous close of $186.53. It had a volume of 12,058,633, up slightly from its average of 10,118,400 and hit a one-day low of $189.32. 

Must Read: Netflix Zooms Past Tesla in Race Among Momentum Stocks

TheStreet Ratings team rates TESLA MOTORS INC as a "sell" with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:

"We rate TESLA MOTORS INC (TSLA) a SELL. This is driven by a number of negative factors, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its generally high debt management risk and poor profit margins."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The debt-to-equity ratio of 1.20 is relatively high when compared with the industry average, suggesting a need for better debt level management. Along with the unfavorable debt-to-equity ratio, TSLA maintains a poor quick ratio of 0.72, which illustrates the inability to avoid short-term cash problems.
  • The gross profit margin for TESLA MOTORS INC is currently lower than what is desirable, coming in at 30.44%. Despite the low profit margin, it has increased significantly from the same period last year. Despite the mixed results of the gross profit margin, TSLA's net profit margin of -8.92% significantly underperformed when compared to the industry average.
  • The company, on the basis of net income growth from the same quarter one year ago, has significantly underperformed compared to the Automobiles industry average, but is greater than that of the S&P 500. The net income increased by 65.3% when compared to the same quarter one year prior, rising from -$110.81 million to -$38.50 million.
  • TESLA MOTORS INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, TESLA MOTORS INC reported poor results of -$3.70 versus -$2.52 in the prior year. This year, the market expects an improvement in earnings ($0.62 versus -$3.70).
  • Compared to other companies in the Automobiles industry and the overall market, TESLA MOTORS INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • You can view the full analysis from the report here: TSLA Ratings Report

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