Musk's 'Master Plan' for Tesla (TSLA) Unveiled, But Questions Remain

CNBC's Phil LeBeau joined 'Squawk Box' this morning to discuss the details behind Elon Musk's 'Master Plan' for Tesla (TSLA).
By Giovanni Bruno ,

NEW YORK (TheStreet) -- Shares of Tesla Motors  (TSLA) - Get Report are lower by 1.69% to $224.50 in pre-market trading Thursday morning, as CEO Elon Musk unveiled his "Master Plan Part Deux" for the company on Wednesday. CNBC''s Phil LeBeau reported on the details of Musk's plan on Thursday morning's "Squawk Box."

The plan lays out four main points, "to integrate Solar City (SCTY) into Tesla, expand the Tesla vehicle lineup to include trucks and buses, to make cars fully autonomous, and to begin a car-share fleet program," LeBeau reported.

"Tesla plans on vehicles in the future to be "fail safe" so if a part of the vehicle, or system of the vehicle, breaks down it will be able to drive itself," LeBeau noted.

Moreover, Musk himself also commented on the autonomous vehicle program, "It would no more make sense to disable Tesla's autopilot as some have called for, than it would to disable autopilot in aircraft," Musk said in a statement.

However, one key component is suspiciously missing from Musk's "Master Plan", how it will be funded. Barclays (BCS) capital analyst Brian Johnson noted.

"The plan is like before, long on exciting visions of the future and short on financial details. It's beyond us how much fundraising Tesla will need to carry out this master plan," Johnson said.

In addition, Johnson also pointed out that Tesla has dug itself a "$4.2 billion hole on the financial side which has necessitated fund raises totaling $6.2 billion."

Separately, TheStreet Ratings rates Tesla a "Sell" with a ratings score of "D+."This is driven by a few notable weaknesses, which TheStreet Ratings believes 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 deteriorating net income, generally high debt management risk, disappointing return on equity, weak operating cash flow and generally disappointing historical performance in the stock itself.

TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author. 


You can view the full analysis from the report here: TSLA

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