The race against time for Tesla Inc (Nasdaq: TSLA) and its investors is coming down to the wire as the company fights to finally get its Model 3 production on track before Tesla runs out of money and investors run out of patience.
Analysts are still divided on how long it will take Tesla to finally hit its Model 3 production target of 5,000 vehicles per week, but CEO Elon Musk is confident that TSLA stock will soon be headed much higher.
[See: A Look Into the Future for 7 Top Auto Stocks.]
On Saturday, Musk tweeted a photo of a new Model 3 production line built in a tent-like structure next to its factory in Fremont, California. Musk said the new production line was built in just three weeks using “minimal resources.” When one commenter pointed out that Tesla short sellers were having a field day over Tesla producing automobiles in a tent, Musk fired back.
“They have about three weeks before their short position explodes,” Musk wrote.
It isn’t the first time Musk has warned Tesla short sellers. Last month, Musk tweeted that a “short burn of the century” is “coming soon.”
Musk is well-known for his optimism, but Tesla has historically struggled to deliver on its promises. Tesla has repeatedly missed its 5,000-per-week Model 3 target that Musk originally set for December 2017. Earlier this month, Musk said Tesla would hit the 5,000 per week mark by the end of June. Musk also says Tesla will be cash-flow positive and profitable by the third quarter after the company burned through another $1 billion in cash in the first quarter.
Instinet analyst Romit Shah says Tesla will likely reach a sustainable Model 3 production rate of 5,000 vehicles per week by the middle of the third quarter.
“This should offer Tesla a chance to achieve its financial targets in [the second half of 2018],” Shah says.
However, earlier this month, Needham analyst Rajvindra Gill said Tesla’s Model 3 production problems are actually worse than investors may realize.
[See: The 10 Most Valuable Auto Companies in the World.]
“Our checks indicate that Tesla probably won’t get to 2,500 per week on a sustainable basis until 3Q and we don’t foresee 5,000 per week until 2Q19,” he says.
Even after gaining 30 percent in the past month, TSLA stock is flat overall during the past year amid the Model 3 production struggles.
More from U.S. News
8 Great Investing Apps and Sites for Millennials
5 Automakers to Rev Up a Long-Term Investor’s Portfolio
These 7 Funds Make You Feel Good About Investing
Musk Hints At Positive Tesla Inc (TSLA) Production Numbers originally appeared on usnews.com
