NEW YORK (TheStreet) -- Shares of Tesla Motors (TSLA) rose 7% in Wednesday's after-hours trading session after reporting better-than-expected third-quarter earnings results. While fourth-quarter guidance was lower than previously reported, that didn't matter to Steve Grasso, director of institutional sales at Stuart Frankel, who said the stock is a buy.
Tesla continues to increase its gross margins, he added. Investors can buy the stock and use the 200-day moving average as a stop-loss, near $226.
Must Read: 7 Stocks Warren Buffett Is Selling in 2014
Guy Adami, managing director of stockmonster.com, agreed with Grasso, saying the stock looks good on the long side. Fourth-quarter guidance was lower due to having supply constraints on the Model S, not because demand was weak.
Dan Nathan, co-founder and editor of riskreversal.com and Tim Seymour, managing partner of Triogem Asset Management, disagreed, both saying investors should avoid the stock. Seymour added the stock's momentum appears to be waning and is trading with a "valuation that is totally not supported."
Jamie Albertine, president of equity research at Stifel Nicoloas, sided with the bulls. He has a buy rating on Tesla with a $400 price target. Production will take a hit in the short term as the company makes adjustments to the assembly process for additional vehicle features. These improvements will ultimately increase the selling price of the company's vehicles, he concluded.
Whole Foods Market (WFM) is also being pushed higher in the after-hours trading session, up 7.3% following an earnings per share beat. The stock could get a squeeze up to $45, Adami said.
Nathan agreed, saying investors who are buying the stock near current levels should use a stop-loss at $40. Seymour argued that investors should wait for a pullback to the range of $36 to $39 before getting long.