Tesla shares fall from record high after warning from analyst

SAN FRANCISCO (Reuters) – Shares of Tesla (TSLA.O) fell from record highs on Tuesday after an analyst warned that the electric car maker may take longer than expected to become profitable.

Jefferies analyst Philippe Houchois launched coverage of Tesla with an “underperform” rating, helping send shares of the company headed by entrepreneur billionaire Elon Musk down 2.17 percent to $ 376.74 after closing at a record high the day before.

“Achievements to-date and vision are impressive, but we don’t think Tesla’s vertically integrated business model can be scaled up as profitably and quickly as consensus thinks and valuation multiples imply,” Houchois warned in a research note.

Houchois’ $ 280 price target was well below the median analyst price target of $ 337.50, according to Thomson Reuters data.

Musk is counting on the recently launched Model 3, Tesla’s least pricey car, to make the Palo Alto, California company profitable and establish it as the leading electric carmaker ahead of BMW (BMWG.DE), General Motors (GM.N) and other long-established players.

Wall Street’s confidence in Musk has sent Tesla’s stock up 83 percent over the past year to record highs.

Skeptics believe Tesla’s aggressive production targets are unrealistic, that Musk is burning through cash too quickly and that the company’s electric cars will be overtaken by larger automakers.

Eight analysts recommend buying Tesla’s stock, while another eight recommend selling, and eight others have neutral ratings, according to Thomson Reuters data. That makes Tesla one of the 10 most poorly-rated stocks in the Nasdaq 100 index.

Reporting by Noel Randewich; editing by Diane Craft

Our Standards:The Thomson Reuters Trust Principles.


IDG Contributor Network: The high cost and risk of On-Premise vs. Cloud

When was the last time I bought an on-prem application?  Over five years ago and I am not looking back. Having been a CIO for many years, I have seen my share of large-scale software implementations and the maintenance and upgrade overhead that comes with on-prem applications. The numbers are varied, but it’s safe to assume that 30-40% of companies have moved into the Cloud and use it as a resource for their applications and/or infrastructure.

Should you simply jump into the pool with the others?  Of course not. First off, a simple “lift and shift” of applications from on-prem into the Cloud will produce minimal benefit if any, and those may be consumed by the resources required for the move itself. That said, a careful strategy to re-engineer your applications platform into the Cloud could have significant cost savings and operational efficiencies. A very detailed TCO (Total Cost of Ownership) is required before making such a strategic decision. There are a variety of published methods for calculating TCO.  My advice is to make friends with the team in Finance and together agree on which method is best for your environment.  Then partner with Finance to do the TCO.  If it has Finance’s fingerprint on it, the credibility ranking goes real high.  

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CIO Cloud Computing

Review: SaltStack shifts devops into high gear

The only sane and efficient way to manage a large numbers of servers—or even a few dozen, if they change often—is through automation. Automation tools have to be learned and mastered, so they exact a significant up-front cost, but they dramatically reduce the administrative burden in the long run. Perhaps most important, they provide a staunch line of defense against the fatal fat-fingered mistake, which even the most sophisticated cloud operators struggle to avoid.

Ease of use. Configuration management is simple with SaltStack. Because Salt uses the YAML configuration format, states are can be written quickly and easily. YAML state descriptions are structured well, with solid readability. The support for Mako, JSON, Wempy, and Jinja allows developers to extend Salt’s capabilities. The availability of built-in modules makes it easy to configure and manage states.

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