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Long Model X Wait Doesn’t Do Tesla Stock Any Favors

But technical pressure may mean now is as good as any to buy TSLA

It seems like a very long time ago that I stayed up late to watch the online reveal event of the Tesla Motors’ (TSLA) Model X crossover SUV. Yet it was only two months back (Sept. 29) when CEO Elon Musk made his characteristic big splash, unveiling what I described then as a “crazy, sexy, cool all-electric vehicle.”

Long Model X Wait Doesn’t Do Tesla Stock Any FavorsOn Monday, the now-iconic zero-emissions carmaker announced a starting price of $81,200 for its base Model X SUV. Oh, and if you order one now you’re going to have to sit on your hands and wait for about a year.

As a big fan of Tesla vehicles, Tesla stock, and as a shareholder who wants to see Tesla stock price climb higher, I must say I was only slightly encouraged by the Model X news.

One reason for my only modest enthusiasm here is that Tesla is definitely front loading the higher-end (and much more profitable) versions of the Model X beginning next year.

What does this mean for customers? Well, if you can afford the fully optioned Model X at $132,000, you are probably going to be the first on your block to roll the “X.” If you opt for the less-costly $116,700 P90D version (the “go fast” version that car crazy nuts like me would opt for), then you might be able to get delivery sometime early next year.

If you’re willing to wait a little longer, you can pay just $96,700 for the slower 90D Model X, but Tesla says this version won’t be out until mid-2016. Then there’s the base version called the Model X70D, which is the $81,200 choice that comes with that approximate 12-month wait.

Tesla_TSLA_ModelX
Source: Tesla

Some in the analyst community think the release of the pricing options will remove an unknown for Tesla stock.

As quoted in the San Jose Mercury News, Robert W. Baird analyst Ben Kallo said, “This is an important step because there was a lot of uncertainty around the pricing and options.”

While I agree with Kallo in terms of the removal of uncertainty, I am not sure if the long wait times are going to do Tesla stock any favors.

Although TSLA is down just 2% year to date, the past six months have seen TSLA hit the skids, down nearly 12%. A rough patch from July through August really pressured shares, and that was due in part to the uncertainty and delays related to the Model X. 

Tesla Motors Inc's (TSLA) Death Cross Problems

Technically speaking, Tesla stock isn’t exactly in great shape.

As my fellow InvestorPlace contributors Johnson Research Group just noted, “Tesla stock saw a death cross form on Nov. 16 as its 50-day moving average crossed below the 200-day. This often represents a long-term shift in price trends that favors the bears.”

I am not one to argue the technicals here, as I’m a firm believer that money flows never lie. However, TSLA isn’t really about the technicals, or even the fundamentals.

The real reason to own Tesla stock is because of the unique and incomparable game changer vehicles and the innovative genius of CEO Elon Musk.

So if you are a long-term investor looking for a stock to deliver down the road, I think now might be a good time to start building a position in the carmaker of the future.

As of this writing, Jim Woods was long TSLA.

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Article printed from InvestorPlace Media, https://investorplace.com/2015/11/tesla-stock-tsla-price-model-x/.

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