The Tesla stock price today is down 9% in after-hours trading even after the company reported a Q3 earnings beat.
Tesla Motors Inc. (Nasdaq: TSLA) reported a Q3 earnings per share (EPS) loss of $0.48, which comfortably beat the consensus projection of a $0.60 loss. Despite the beat, investors were spooked by the quarterly loss.
Revenue for the quarter was $1.2 billion. That beat estimates of $1.17 billion and was a 40% increase from last year.
Tesla also reported its highest production and delivery totals in the company's history. In Q2, 11,532 vehicles were delivered while 12,807 were produced. Looking ahead, the company expects to produce and deliver over 12,000 vehicles in Q3 despite the fact that its main facility will be closed for one week.
The company also said that deliveries for the Model X SUV will begin in September. This is a huge step for the company, which is solely producing Model S sedans right now. Company officials have already said the vehicle will have a 90-kilowatt-hour battery and falcon-wing door.
CEO Elon Musk expects production and demand between 1,600 and 1,800 vehicles per week for both the Model S and Model X in 2016.
Despite many of these optimistic earnings numbers and sales figures, the Tesla stock price today is falling.
Here's how we recommend playing TSLA stock now after earnings...
How to Play the Tesla Stock Price Today
We routinely tell Money Morning readers that TSLA stock is not a perfect fit for every investor. It is not a buy for risk-averse investors.
The Tesla stock price is volatile and frequently sees wide price swings. Today's 9% drop after hours is the perfect example. The company beat on both earnings and revenue, yet the stock is still down dramatically.
But for investors who can buy and hold the stock for several years, the long-term potential is undeniable.
"I believe Tesla is one of the best long-term investments an investor can make at the moment," Money Morning Chief Investment Strategist Keith Fitz-Gerald said. "If there is ever a case to buy a few shares and tuck them away, this is it."
One reason we're bullish is Tesla's home battery system.
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Earlier this year, Tesla announced a new line of home units built using the same lithium-ion batteries used in Tesla cars. Different models store either 7 kWh or 10 kWh of solar power. It's a major shift for Tesla, making it more than just a car company.
"I think Musk is the most innovative CEO on the planet and that he sees value others don't yet recognize," Fitz-Gerald said. "Cars, batteries, innovative business models - nobody knows where it will go but ultimately if you're along for the ride, I think it'd be very hard to go wrong over time."
Money Morning Global Energy Strategist Dr. Kent Moors has spoken of the home battery's importance since early 2015.
"In everyday use, the unit is expected to allow homeowners to store solar-generated power for use during high-cost periods, giving them the flexibility to use the conventional grid for cheaper, off-peak electricity," Moors said in February.
Another reason to be bullish is Tesla's new Gigafactory.
Currently under construction in Nevada, the Gigafactory will be the world's largest lithium-ion battery plant upon completion.
The factory is expected to take a total of $5 billion to complete. By the time it reaches full production in 2020, it should produce enough batteries to power 500,000 vehicles annually.
"The Gigafactory is expected to have a dramatic effect on the energy storage market, helping to bring battery costs down by as much as half by 2020," Moors said.
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