Tesla needs tons of cash to run its operations and make new investments. Its near-term projected liquidity is under severe stress. And an addition of another cash strapped company will only compound the problem. While in the long term, a better than expected demand of Model 3 may ease the cash crunch, the near-term prognosis is not good. And to get to the long-term survival in the short-term is important. The Altman Z-score shows Tesla runs a high risk of bankruptcy and the risk increases considerably. The most important task for Tesla now should be to shore up liquidity. After all, cash is always the king. Tesla stock is currently at best a speculative bet.Read more "Bankruptcy Is A Serious Risk For Tesla Motors Inc Stock"
“During the third quarter, we will be using substantial amounts of cash in connection with conversions of our 2018 Notes and we could pursue other actions to reduce our outstanding balance of convertible notes, which could require further outlays of cash,” Tesla wrote in the filing with the U.S. Securities and Exchange Commission.
If the two third-quarter payments are subtracted from the mid-year cash balance, Tesla would have $2.1 billion left over. The company on Wednesday told analysts it planned $1.75 million in the second half of the year on capital expenditures.
Tesla declined to comment beyond the filing.Read more "Tesla Motors discloses $1.1 billion in third-quarter cash needs"