Ahead of the Bell: Tesla
Tesla shares rise in premarket after German probe into vehicle fires concludes without action
NEW YORK (AP) -- Tesla shares surged in premarket trading Tuesday after the company disclosed that a German investigation into recent fires involving its Model S sedan found no manufacturer-related defects.
The electric car maker said late Monday that it was notified by German regulators that they were closing their investigation into the post-crash fires in Washington, Tennessee and Mexico and would take no further action.
Shares of Tesla Motors Inc. rose $7.83, or 6.3 percent, to $132 in premarket trading about an hour before the market opening. The stock had risen nearly five-fold this year, but has tumbled about 34 percent in the months since the first fire was reported.
In a note to investors, Jefferies analyst Elaine Kwei said the good news out of Germany should boost confidence that the ongoing investigation by federal officials in the U.S. will also turn out favorably for the company.
Kwei backed her "Buy" rating for Tesla shares, saying that the news of the fires has already taken its toll on the company's stock price and that there is more positive news ahead that could boost it.
