Yahoo Finance Tesla-Panasonic to Manufacture Solar Cells at Buffalo Plant
Tesla Motors, Inc. TSLA has signed an agreement with Panasonic Corp PCRFY to produce photovoltaic cells and modules in Buffalo, NY, from the summer of 2017. The companies signed a non-binding letter of intent for the same in October.
Per the agreement, Panasonic will bear the capital expenses needed for the plant in return for a long term purchase commitment by Tesla. The companies plan to increase the production volume of photovoltaic modules at the plant to 1 Gigawatt by 2019. Additionally, the companies will collaborate to develop the next generation of photovoltaic technology at the Fremont, CA plant of Tesla’s subsidiary SolarCity.
Tesla will use the cells and modules produced in the Buffalo plant to make solar panels for its non-solar roof products. The company will also use these cells in various kinds of solar glass tile roofs, when their production starts.
Price Movement
Tesla has been underperforming the Zacks categorized Auto Manufacturers-Domestic industry for most of the year. Year to date, the share price of Tesla lost 11.1% while the industry witnessed a 2.9% gain.
Tesla has been facing production-related issues for a long time, as a result of which it has failed to meet delivery targets in the first two quarters of 2016. This, along with the losses incurred by the company, pulled down its share price. Tesla’s stock was also affected by the announcement of the SolarCity acquisition due to concerns related to the losses of the latter, debts and cash outflow. However, now that the acquisition is completed, investors are expected to shift their focus on Tesla’s growth plans.
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Zacks Rank & Key Picks
Tesla currently carries a Zacks Rank #3 (Hold). Better-ranked auto stocks include Allison Transmission Holdings, Inc. ALSN and America's Car-Mart Inc. CRMT.
America's Car-Mart has a long-term expected growth rate of 45.5%. It is currently sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Allison Transmission has a long-term growth rate projection of 11%. The company carries a Zacks Rank #2 (Buy).
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