Musk: Tesla Motors Inc (TSLA)’s Not for Sale…Yet

Page 2 of 2

Is SolarCity following Tesla’s path to riches?

SolarCity has some of the same problems Tesla did in the beginning, posting an atrocious profit margin of -73.19%, as well as the fact that it is yet to post a quarterly profit. However, quarterly revenue growth has hit 20.7%, so it is making revenue, but costs and debt are hindering the company when 2Q reports show over $280 million in debt and $1.26 billion in liabilities vs. only $187 million in equity. Since its earnings-per-share is -3.49 as on June 27, there is no forward P/E to report, but if it follows Tesla’s path, it will start off as an expensive company in that department, though with a market cap of $2.47 billion, it would be a cheaper purchase for a company like Google to invest in, should it become profitable. It may even be sold quicker than Tesla.

The bottom line: it’s still a rumor…for now

The Google-Tesla rumors are so far just that, rumors. However, Google Inc (NASDAQ:GOOG) has an interest in car companies and car software, so it’s a rumor that could become true in a few years, maybe with Tesla or somebody else. If Google goes ahead with driverless-operating systems, Tesla Motors Inc (NASDAQ:TSLA) could be their biggest partner thanks to Google’s investment in the company, as well as built in Google features in the Model X, all of which are immediate possibilities.

We’ll be seeing more of Elon Musk over the next decade or so, but when he wants to kick back in his SolarCity powered house and look back on his successful life, Google may be the first people to knock on his door, cash in hand.

The article Musk: Tesla’s Not for Sale…Yet originally appeared on Fool.com and is written by John McKenna.

John McKenna has no position in any stocks mentioned. The Motley Fool recommends Google and Tesla Motors . The Motley Fool owns shares of Google and Tesla Motors. John is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Page 2 of 2