Tesla's stock is surging but some analysts found real problems with its earnings report

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Shares of Tesla are surging after the company reported a surprise profit, but a closer look at the numbers may suggest a cause for concern.

. While many on the Street said it was a solid report, some are calling for caution based on growth concerns and falling margins.

"The one very concerning aspect of the quarter was that top-line growth reversed to a decline, with 3Q:19 deliveries up a mere 2% sequentially from 2Q:19," Bank of America analyst John Murphy wrote in a note to clients, adding that it was "the first decline in seven years for a 'growth' company." He has an underperform rating on the stock, and a $235 target.

But investors chose to focus on Tesla's adjusted earnings per share of $1.86 versus an expected loss of 42 cents per share. Also the electric vehicle maker gave an update on its new Shanghai Gigafactory, where the company said trial production runs have begun. Tesla said it was ahead of schedule on the long-awaited Model Y crossover vehicle, as well. The shares were up 15% in premarket trading Thursday.

"Cost control can help a quarter, but we struggle to understand how spending doesn't have to go up to support Tesla's growth ambitions," he said. He has an underperform rating on the stock and a $220 target.

 

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Of course GREEDY BIG OIL CARTEL ANTI-CAPITALIST CNBC FRAUDS WOULD FIND SOMETHING NEGATIVE IN A PROFIT, ONLY IF IT IS SOMEONE OR A COMPANY THEY HATE LIKE TESLA THAT COMPETES WITH OIL/GASOLINE

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