UBS Cuts Tesla (TSLA) to Sell

UBS Cuts Tesla to Sell

– Reduces PT $220 to $210
– Cuts 2016 EPS from $5.30 to $2.50
– Cuts 2017 EPS from $4.30 to $1.20

“Even if we credit TSLA with reaching target margins, assume limited dilution despite capacity needs, & assume it trades at 25x PE in 10 years, the current price implies deliveries of >1.5m vehicles in 10 years plus full utilization of storage capacity; both are unlikely in our view. The stock has jumped +40% since the anticipation of the storage announcement; however, our analysis indicates that TSLA’s current planned 15GWs of storage capacity may be larger than the market in 2020.”