Tesla Surging: What Wall Street's Saying

Updated from 10:47 a.m. to include thoughts from Morgan Stanley analyst.

NEW YORK (TheStreet) -- Tesla Motors (TSLA) shares surged 9.5% to $212.00 in Thursday trading after the electric vehicle maker posted fourth-quarter results that were better than expected, and 2014 looks to be even brighter.

The Palo Alto, Calif.-based firm earned 33 cents a share, generating $761 million in revenue during the quarter, on a non-GAAP basis. Tesla delivered 6,892 Model S units, and had a 25.2% non-GAAP gross margin. The company believes it has room to expand gross margins even further, as economies of scale and volumes continue to increase. "We think an automotive gross margin of 28%, excluding potential ZEV credit sales, is a reasonable target for Q4 2014, even if a lower option take rate is assumed," the company said in a letter to shareholders. 

Analysts surveyed by Thomson Reuters were expecting Tesla to earn 21 cents a share on a non-GAAP basis, generating $677.36 million in revenue.

Last month, at the Detroit Auto Show, Tesla said it delivered 6,900 Model S units during the fourth quarter.

TSLA ChartTSLA data by YCharts

For 2014, Tesla said it expects to deliver 35,000 Model S units, and will up production to 1,000 cars a week, as the company continues to address bottlenecks that it hopes will "improve significantly in the second half of 2014."

For the first quarter, Tesla expects to produce about 7,400 Model S units, but will actually only deliver around 6,4000 vehicles due to continued supply constraints.

Touching on the Model X, Tesla said it expects "to have production design Model X prototypes on the road by end of year and begin volume deliveries to customers in the spring of 2015." On the call, Musk said Model X demand is "very high," despite there being no advertising for the upcoming sports utility vehicle. He wouldn't disclose the amount of reservations for the Model X, but noted "the fish are jumping in the boat," when talking about demand.

Tesla also noted it would have news on the Gigafactory soon. "This will allow us to achieve a major reduction in the cost of our battery packs and accelerate the pace of battery innovation," the company said in the letter. "Working in partnership with our suppliers, we plan to integrate precursor material, cell, module and pack production into one facility. With this facility, we feel highly confident of being able to create a compelling and affordable electric car in approximately three years. This will also allow us to address the solar power industry's need for a massive volume of stationary battery packs."

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