NEW YORK ( TheStreet) -- Tesla Motors (Nasdaq: TSLA) has been upgraded by TheStreet Ratings from sell to hold. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance and notable return on equity. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, poor profit margins and feeble growth in the company's earnings per share. Highlights from the ratings report include:
- TSLA's revenue growth has slightly outpaced the industry average of 6.3%. Since the same quarter one year prior, revenues slightly increased by 8.5%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- Compared to its closing price of one year ago, TSLA's share price has jumped by 38.21%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
- 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.
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Automobiles industry. The net income has significantly decreased by 58.7% when compared to the same quarter one year ago, falling from -$51.36 million to -$81.49 million.
- The gross profit margin for TESLA MOTORS INC is currently lower than what is desirable, coming in at 32.10%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -207.00% is significantly below that of the industry average.
-- Written by a member of TheStreet RatingsStaff