Tesla’s outlook is buoyed by an earlier-than-expected Oct. 24 earnings release, a new, lower-priced Model 3 car for $45,000, a potentially stronger-than-forecast third-quarter cash flow that may pressure short sellers betting the car maker’s share price will fall and launch of a new online order page aimed at simplifying the sales process for buyers.

Despite the share price of Tesla Inc. (NASDAQ:TSLA) initially falling after it unveiled plans on Oct. 18 to introduce a mid-range, $45,000 Model 3 rather than the $35,000-version previously promised by its CEO Elon Musk, the company may well turn a third-quarter profit that could catch short sellers off guard. Ironically, the Securities and Exchange Commission (SEC) forced Musk to give up his role as Tesla’s chairman for the next three years and to pay $20 million fine that will be matched by the company to compensate investors “harmed” by his Aug. 7 tweet about having funding to take the company private.

Tesla bull ARK Invest praised the mid-range, rear-wheel drive Model 3’s introduction, the car’s capability to accelerate from 0 to 60 mph in 5.6 seconds and travel with a range of 260 miles per charge for just $45,000 -- before any incentives. While Tesla critics seemed to conclude demand for the high-end Model 3 had been saturated to necessitate the mid-range car’s advent, Tesla is following a “well-orchestrated strategic plan,” Ark Invest opined.

A surprising supportive view of Tesla came from long-time short seller Citron Research, which released a statement on Oct. 23 indicating that has reversed course and taken a long position in the electric car maker after new analysis and “due diligence” found the Model 3 is a “proven hit.” Many previous “warning signs” have proven not to be significant for Tesla, Citron Research opined.

Investors took note and bid up Tesla’s stock price $33.19, or 12.72 percent, to close on Oct. 23 at $294.14. Even though Tesla reported a record $743 million loss in the second quarter of 2018, Musk has offered guidance that the company will turn a profit in the third quarter when it announces results on Oct 24.

Chart Courtesy of stockcharts.com

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Paul Dykewicz, www.pauldykewicz.com, is an accomplished, award-winning journalist who has written for Dow Jones, the Wall Street Journal, Investor’s Business Daily, USA Today, the Journal of Commerce, Seeking Alpha, GuruFocus and other publications and websites. Paul is the editor of StockInvestor.com and DividendInvestor.com, a writer for both websites and a columnist. He further is the editorial director of Eagle Financial Publications in Washington, D.C., where he edits monthly investment newsletters, time-sensitive trading alerts, free e-letters and other investment reports. Paul previously served as business editor of Baltimore’s Daily Record newspaper. Paul also is the author of an inspirational book, “Holy Smokes! Golden Guidance from Notre Dame’s Championship Chaplain,” with a foreword by former national championship-winning football coach Lou Holtz.