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Why Tesla Inc (TSLA) Will Punch Through the Ceiling Again

By U.S. News & World Report

This week will mark the first time that Tesla Inc (ticker: TSLA) reports quarterly earnings under its spanking-new moniker. That might sound like just an interesting bit of trivia, but there’s a bit more to it than that.

Elon Musk’s Tesla Motors switched over to simply Tesla at the start of the month in large part to reflect the fact that the company folded in solar energy services company SolarCity Corp. last year. The problem? That’s about the only effect on Tesla that anyone is really sure of.

That’s just one of a few important storylines that could weigh on TSLA stock heading into (and following) Tesla’s fourth-quarter earnings report on Wednesday.

The numbers. Expectations for double-digit growth out of Tesla still are par for the course. The Wall Street estimate for revenues sits at $2.19 billion, up 25.6 percent from the same quarter last year. Meanwhile, analysts believe TSLA will produce a 43-cent loss — but that would be less than half the 87 cents in red ink that Tesla produced in its previous fourth quarter.

[See: 6 Things to Know About Mark Zuckerberg’s Manifesto.]

Tesla surprised Wall Street by posting a 14-cent GAAP profit (71 cents non-GAAP) in the third quarter, but investors shouldn’t expect a similar performance out of Tesla this quarter. For one, Elon Musk made no bones about actively pushing the pedal to the floor in search of a third-quarter profit, with Tesla’s CEO saying in an email that “the third quarter will be our last chance to show investors that Tesla can be at least slightly positive cash flow and profitable before the Model 3 reaches full production.” It doesn’t appear a similar effort took place in the fourth quarter.

Also, Tesla already reported its deliveries for the fourth quarter, and that number (22,200) came in 2,800 units short. Granted, that was due to “last-minute delays in transport or because the customer was unable to physically take delivery,” but that still makes TSLA less likely to produce a fourth-quarter profit.

What about SolarCity? The thing about analyst estimates for the quarter is, most of them are based on Tesla Motors figures — because most analysts aren’t quite sure how to factor in SolarCity and its massive losses.

So while the consensus estimate is for a 43-cent adjusted loss, Bloomberg points out that estimates range anywhere between a $2.13 loss and a 10-cent profit. In the same report, it quotes Consumer Edge Research’s James Albertine, reflecting much of the analyst community:

“We do not know how Tesla plans to report SolarCity results in the future and it remains unclear to us how peers are incorporating (or not incorporating) SolarCity into current estimates,” he says. “We will await further details from management before rolling the solar panel business into our model.”

Those who do have SolarCity’s “contributions” factor in present some unattractive forecasts. JPMorgan Chase & Co.’s Ryan Brinkman recently maintained an “underweight” rating on TSLA stock, saying, “Our Tesla estimates appear materially changed, although this almost entirely stems from newly incorporating SolarCity’s large non-GAAP losses.” JPMorgan’s 2017 profit estimate for Tesla is more than four times the consensus expectation for a $1.26 loss.

For the record, JPMorgan favors Ford Motor Co. ( F) and General Motors Co. ( GM) instead.

The Model 3. Analysts and investors alike will probably be much more interested in forecasts and forward-leaning comments from the company.

The biggest topic of interest should be the Model 3 — Tesla’s $35,000 electric vehicle that has driven excitement about the automaker’s ability to compete in a mass-market fashion. And on that front, Musk has already stoked the fires by recently announcing that the company was going to retool its Freemont, California, factory for Model 3 production. This “will allow Tesla to begin Model 3 production later this year as planned and enable us to start the ramp towards 500,000 vehicles annually in 2018” — a statement that encouraged TSLA stock investors who have become conditioned to expect delays and setbacks.

[See: 10 Ways to Buy Industrial Stocks.]

Perhaps just as importantly: “We do not anticipate this brief pause to have a material impact on our first-quarter production or delivery figures, as we have added production days to compensate.” Between this, and the fact that a couple thousand expected fourth-quarter deliveries had to be pushed forward, Tesla also could be setting itself up for a boffo first-quarter outlook.

Around the world. Wall Street also will want to hear more from the company about how international expansion — another area where Tesla has been generating headlines of late — might eventually hit its top and bottom lines.

Musk recently attended the World Government Summit in Dubai, United Arab Emirates, where he announced that Tesla would be debuting in the Middle East this summer. The company will begin selling the Model S sedan and Model X SUV, and will add five Supercharger stations to the UAE’s current two.

Tesla’s CEO wasn’t as committal on the subject of India when it was breached earlier this month, but that market could be on the menu this year, too. In response to a tweet inquiring about whether Tesla has plans to launch in India — and if so, when — Musk replied, “Hoping for summer this year.” If nothing else, Tesla at least has half the engine running on that front, as the company has been taking Model 3 orders in India since April 2016.

What to expect from Tesla. TSLA shares hit all-time highs last week before pulling back in part on worries that Tesla factory workers had talked to the United Auto Workers about possibly unionizing. Still, shares are in the midst of a 50 percent-plus run since the start of December, and they’re only about 3 percent off their recently reset peak.

But as long as the broader market continues to defy gravity, expect investors to be looking for more reasons to buy than reasons to sell. From that perspective, while Tesla might be in line for a modest fourth quarter, the company could telegraph a strong Q1.

[See: 8 Tips for Investing in Your 30s.]

If so, expect TSLA stock to snap out of its power nap and climb to new heights.

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Why Tesla Inc (TSLA) Will Punch Through the Ceiling Again originally appeared on usnews.com

Don’t Settle for Student Loans to Pay for Online Education

By WTOP Staff
Online college programs are becoming a more popular choice for prospective students, with one study finding that more than 6 million students enrolled in at least one online course in fall 2015. The popularity of these courses can be attributed in part to their flexibility with working adults' schedules, students' ability to progress more quickly through online programs and, oftentimes, cheaper tuition. [See 10 low-cost online bachelor's programs for out-of-state students.]Online degrees can be beneficial to many college students, but some studies have shown online learners complete their programs at lower rates than students at traditional brick-and-mortar campuses. Individuals with student loans but no degree comprise two-thirds of defaulted borrowers. Though these numbers are not encouraging, just like for traditional programs, there are ways to reduce how much you'll need to borrow for an online program to ensure you won't become one of these statistics. Don't just settle on borrowing student loans to cover the whole cost of your program and living expenses. Instead, start thinking about how to cut costs and cover your balance in different ways, such as the following. -- Grants and scholarships: Even though you are taking an online course, you can still apply and receive grants and scholarships. But your first step should be to complete the Free Application for Federal Student Aid, commonly referred to as the FAFSA, which will allow you to receive a Pell Grant if your expected family contribution is low enough. The EFC criteria and award amounts are adjusted annually, but the 2017-2018 academic year awards range from $606 to $5,920, which could significantly lower the amount you borrow annually. Your next step is to apply for scholarships. You can start by checking online scholarship search engines, such as the Salt Scholarship Search, College Board's BigFuture and Peterson's. But don't forget to take advantage of local organizations and your school's financial aid office. Both may offer scholarships that you can't find with a national scholarship search. [Review these 10 sites to kick off your scholarship search.]For instance, organizations like the Elks Club, Knights of Columbus or the Rotary Club typically offer scholarships annually to local students. Just because you're going to school online doesn't mean you're ineligible. Visit your local library for scholarship listings, and ask around town. You might be surprised how many local organizations offer scholarships. While these scholarships typically aren't large, every little bit counts. Each dollar you receive in a scholarship is a dollar you don't have to borrow and pay interest on. -- Work-study: Another option for online students may be work-study awards. Not all students enrolled in online programs are eligible, but students at some schools -- including, for example, SUNY Empire State College and Liberty University -- are. Work-study awards are not given upfront like scholarships and grants. In most cases, they are an offer to earn up to the awarded amount if you secure an eligible work-study job. While there is a misconception that all work-study jobs must be on campus, students can work for off-campus, nonprofit or public employers as long as the work is in the public's interest. You may be able to work for a for-profit employer if the job is relevant to your course of study. No matter who the outside employer is, it will need to have an established agreement with your college for you to receive work-study funds. Remember, to be eligible for federal financial aid, you must be enrolled and pursuing a degree or certificate. If you're not working toward a credential, Pell Grants and work-study won't be option, but you may still be able to take advantage of private scholarships -- just be sure to read the eligibility criteria carefully. [Explore what to know about financial aid in online programs.]-- Pay as you go: One of the great benefits to enrolling online is the flexible schedule, which can allow you to complete your college coursework around your responsibilities. But prospective students often overlook using their part- or full-time job earnings as an option for paying for college. Almost 80 percent of college students in 2015 worked at least part time while attending classes, according to the National Center for Education Statistics. By budgeting and thinking strategically about your college costs, you can likely reduce your dependence on student loans by paying a portion out of pocket. Many -- but not all -- online programs are less expensive than traditional programs and often have shorter payment periods. Six, eight or 10 weeks are common course durations. Because of the frequency of payments in an online setting, you may be well-placed to pay as you go and possibly avoid borrowing altogether. Attending college online and avoiding student loans may be challenging, but if you are willing to put in the effort, you can limit the amount you need to borrow. More from U.S. News Q&A: Understanding Student Loan Discharge Eligibility Student Loan Refinancing Isn't Right for All Borrowers
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