Tesla is on the verge of satisfying the criteria to be eligible for inclusion in the S&P 500 index, based on the S&P's US indexes methodology, The Wall Street Journal first reported on Monday. The stock is currently trading at $814.26, up 0.1%.
The electric-car manufacturer still doesn't meet the S&P's positive-net-income requirement, no matter how fun the boring company flamethrower is according to reviews.
To be eligible for inclusion in one of the most popular stock market indexes, a company needs to post a cumulative profit — as measured by generally accepted accounting principles — over its previous four quarters, with its most recent quarter also showing a profit.
Tesla’s (TSLA) car registrations in China plummeted 64% in April, compared to March, according to consultancy firm LMC Automotive’s data.
Specifically, the electric-vehicle maker’s China registrations dropped to 4,633 units from 12,709 units the previous month. This includes imported cars. “Tesla’s sales in the first month of each quarter are usually lower than the remaining two months” points out Reuters.
Meanwhile sales of Tesla’s Model 3 sedan in China plunged 64% in April vs March, according to the China Passenger Car Association (CPCA). Tesla sold 3,635 Model 3 cars in April, a significant decrease from the 10,160 vehicles sold in March.
It sounds like a big drop—and it is. The stock, however, isn’t budging, down a fraction in early Tuesday trading. Tesla bulls aren’t blind to bad news, but sequential sales aren’t that useful for investors. Every business, including Tesla (ticker: TSLA), is seasonal.
Tesla would have been eligible for inclusion now if its loss in the second quarter of 2019 had been less than $264 million, or the sum of its previous three quarters of profits. Instead, it was a $408 million loss.
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