April 3rd, 2020

To join the S&P you need to be overall profitable in the last 4 quarters.

Things were looking really good for Tesla prior to Covid-19. The Q1 2019 results last year has been putting a -$702M drag on their net income.

If this went away, the last 3 quarters would balance to -$107M. Therefore TSLA needed to post +$107M this quarter to join S&P 500.

Q3 & Q4 2019 were great quarters. Q4 even had more vehicles delivered than produced. TSLA came into Q1 2020 needing to produce and deliver almost all the vehicles.

Yesterday TSLA reported 101K cars produced and 88K cars delivered. Last year when we saw 10K+ cars in transit overseas, we saw a loss of $702M.

For this reason, I expect a similar loss this quarter and unfortunately, I don't expect TSLA will join the S&P 500 until Q1 or Q2 2021 now.

It is a shame that the hard work from Tesla employees is not better realised at this crazy time. I forsee good TSLA buying opportunities ahead.

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ABOUT THE AUTHOR:
I am TSLA Long. Model 3 Owner. Brother of a Model 3 owner. Son of a Model S owner. I have reservations for Slate Roof and Cybertruck. I am a Tesla speculator and fanboy. I am not a financial advisor. Investing in anything comes with inherent risk. This is not financial advice.