TSLA Options: All Eyes are on the Shareholder Meeting

Tesla Motors (NASDAQ:TSLA) will be conveying its annual shareholder meeting at 5PM EDT today and the market is poised to see how the stock will move after event. For one, the annual shareholder meeting creates an avenue for CEO Elon Musk to update shareholders about what’s been going on in the company. The meeting also allows shareholders to ask questions and seek clarity about the overall direction of the company.

Items for Discussion

  • Model S Updates

The Model S has been Tesla’s main revenue driver with its $75,000 price tag; hence, investors will be looking to see new updates that will sustain the demand for the luxury ride. Tesla has already announced the inclusion of a dual motor, improved autopilot, and an upgraded 70KWh entry-level battery for the Model S. Shareholders will be on the lookout for news relating new updates and plans to increase production speeds. News on updates and improvement in production levels could cause the shares of Tesla to rise during the session.

  • Model X Schedule

Tesla has revealed the prototype for its Model X since 2013, but the SUV is yet to hit the market as the launch keeps being delayed. The tricky part is that Tesla announced that it has more than 20,000 pre-orders of the Model X in its books at the start of this year. Each of those pre-orders requires a $5000 deposit.

Shareholders will most likely be interested in updates about the Model X launching and delivery schedule. Tesla has already announced that customers can start ordering the configuration of their vehicle specs in July, and that delivery should start sometime in September. A confirmation of the delivery timeline would be seen in positive light and we can expect the stock to rise on the news. However, an extension of the delivery schedule is likely to cause the shares of Tesla to tank.

  • Model 3 Pre-Launch

Tesla has announced its proposed Model 3 as a reasonably priced version of its electric cars that will appeal to a wider audience. It is expected that the Model 3 will cost around $35,000 before tax credits, which is less than half of the $75,000 price tag of the Model S.

However, there hasn’t been much updates on when the Model 3 will be unveiled; hence, word on the Model 3 could move the shares of Tesla significantly after the shareholder meeting.

  • Updates on Gigafactory

Tesla’s Gigafactory that is being built in Nevada is crucial to its ability to get new vehicles out of its plant and to obtain better economies of scale in its production costs. Shareholders will want updates on how the Gigafactory is coming along. They’ll also want to know if the production timeline for the Gigafactory is still intact.

  • New Deal with Panasonic

In the meantime, the share of Tesla are garnering positive momentum as it gained 2.87% to close at $256.29 in yesterday’s session. One of the reasons behind yesterday’s gains is the announcement that Tesla has inked a deal with Japanese electronics maker, Panasonic corp.

The element of the deal says that Panasonic will invest human resources into Tesla’s Gigafactory project by sending in hundreds of workers to the Nevada plant starting from autumn. In addition, Panasonic will be committing almost $500 million to the Gigafactory project as parts of investment in its 30% to 40% stake in the venture.

How to Trade TSLA Options

The next direction for Tesla shares is dependent on the kind reading that shareholders have on the company after the today’s meeting. However, I am leaning towards the bullish camp for Tesla because of the positive vibes surrounding the company. You should consider buying the TSLA Sep 2015 270.000 call (TSLA150918C00270000) at an asking price of $14.30.



— Daily Option Alerts

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