JMP Securities gave Tesla (NASDAQ: TSLA) shares a new outperform rating on Wednesday, citing the automaker's collection of top talent and competition that continues to lag behind Elon Musk's electric car manufacturer. JMP's message to buy Tesla comes hours before the company will report third-quarter earnings on an earlier date than expected.
"We believe the expertise Tesla has accumulated in key aspects of electric vehicle development and manufacturing is very difficult to duplicate," JMP's Joseph Osha said in a note.
The stock surged more than 12% on Tuesday after noted short seller Andrew Left changed his mind and went long the stock.
Left and other investors are speculating Tesla's results after the bell Wednesday will be better than expected because the company moved up the date when it typically reports third-quarter results. In the past, they have been revealed in November and traders don't believe they would be in a hurry to put out bad news.
Traders are eager for the report as CEO Elon Musk had promised that Tesla would report a net profit and positive cash. It was also encouraging that short seller Citron Research did a U-turn on its bearish outlook on the stock and said in a research note that the company's Model 3 sedan is a "proven hit" and is serious competition against other plug in car automakers.
The shares were up 42 cents Wednesday, to $294.56. The stock is up 11% in October even as shares of other automakers and technology companies struggle along with the broader stock market.
JMP initiated with a $350 a share price target on Tesla, which is more than 18% above Tuesday's closing price of $294.14 a share.
