{"id":33420,"date":"2022-10-11T12:04:11","date_gmt":"2022-10-11T16:04:11","guid":{"rendered":"https:\/\/autosector.com\/?p=33420"},"modified":"2022-10-11T12:04:11","modified_gmt":"2022-10-11T16:04:11","slug":"tesla-stock-considered-investment-grade","status":"publish","type":"post","link":"http:\/\/autosector.com\/?p=33420","title":{"rendered":"Tesla Stock Upgraded To Investment Grade By S&P Global"},"content":{"rendered":"

This article comes to us courtesy of\u00a0EVANNEX<\/a>, which makes and sells aftermarket Tesla accessories. The opinions expressed therein are not necessarily our own at\u00a0InsideEVs<\/a>, nor have we been paid by\u00a0EVANNEX\u00a0to publish these articles. We find the company’s perspective as an aftermarket supplier of Tesla accessories interesting and are happy to share its content free of charge. Enjoy!<\/em><\/p>\n

Posted on<\/span>\u00a0EVANNEX on October 11, 2022\u00a0by<\/span>\u00a0Peter McGuthrie<\/p>\n

The past few years have played a crucial role in Tesla\u2019s history, turning the automaker from a struggling auto company with big dreams to a key player on Wall Street with a strong grasp on the electric vehicle industry. And now, one\u00a0investment rating<\/a>\u00a0service has taken notice of Tesla\u2019s shift, officially saying it\u2019s a worthy consideration for investors.<\/p>\n

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Above: The logo on the front of a Tesla. Photo:\u00a0Afif Ramdhasuma<\/a>\u00a0\/ Unsplash<\/em><\/p>\n

Tesla<\/a> was upgraded to investment-grade BBB status by S&P Global Ratings earlier this month, as reported by\u00a0electrek<\/em><\/a>. Before the change, Tesla was still considered a \u201cjunk bond\u201d by S&P and other investment rating services, although the automaker delivered two years\u2019 straight worth of profits with a cash position of more than $18 billion to date.<\/p>\n

The investment ratings represent a long-term credit rating, which takes into account various considerations such as debt levels, profit, cash flow and other common financial market indicators. Before the change, Tesla was rated BB+ by S&P Global Ratings, which is reserved for junk bond-level stocks.<\/p>\n

S&P Global Ratings said that the company\u2019s credit profile has improved due to its continuingly dominant position in the EV industry. Noting the company\u2019s cash flow and increased production capacity with Tesla\u2019s newly opened Giga Berlin and Texas locations, the investment rating index says continued leadership in the market makes it officially investment-grade.<\/p>\n

\u201cWe now view Tesla\u2019s credit profile more favorably because it continues to demonstrate market leadership in electric vehicles (EVs), with solid manufacturing efficiency that supports strong EBITDA margins and sustained positive free operating cash flow (FOCF), above our previously established upside triggers,\u201d wrote the S&P Global Ratings team in a memo.<\/p>\n

The firm also said it expects Tesla to keep its debt levels low as profits continue to remain steady or strong \u2014\u00a0a key indicator of potential future growth.<\/p>\n

\u201cThe stable outlook reflects our expectation that Tesla will maintain low debt levels as it sustains its solid market share, profitability, and strong liquidity amid a weakening economy and an increasingly competitive environment for EVs.\u201d<\/p>\n

For the average investor and those who are already\u00a0Tesla shareholders<\/a>, the change doesn\u2019t affect much. However, it may increase interest from large investment funds, many of which have protocols against investing in stocks ranked below investment grade. Now that Tesla has become a \u201cblue chip\u201d company, as many call investment-grade stocks, the automaker\u2019s stock could become more appealing to firms that were prevented from buying shares.<\/p>\n

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In any case, no one can fully predict what a company\u2019s stock will do. But for many, Tesla\u2019s upgrade to BBB by the S&P Global Ratings could be the push needed to re-open the stock as an option for their portfolio.<\/p>\n

Source:\u00a0electrek<\/a><\/em><\/p>\n

===<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

This article comes to us courtesy of\u00a0EVANNEX, which makes and sells aftermarket Tesla accessories. The opinions expressed therein are not necessarily our own at\u00a0InsideEVs, nor have we been paid by\u00a0EVANNEX\u00a0to publish these articles. We find the company’s perspective as an aftermarket supplier of Tesla accessories interesting and are happy to share its content free of […]<\/p>\n","protected":false},"author":1,"featured_media":8313,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[4],"tags":[],"class_list":["post-33420","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-e-cars"],"_links":{"self":[{"href":"http:\/\/autosector.com\/index.php?rest_route=\/wp\/v2\/posts\/33420","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/autosector.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/autosector.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/autosector.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/autosector.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=33420"}],"version-history":[{"count":0,"href":"http:\/\/autosector.com\/index.php?rest_route=\/wp\/v2\/posts\/33420\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"http:\/\/autosector.com\/index.php?rest_route=\/wp\/v2\/media\/8313"}],"wp:attachment":[{"href":"http:\/\/autosector.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=33420"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/autosector.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=33420"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/autosector.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=33420"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}