As Tesla taps capital markets for cash, share price could top $100

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Joseph C. Cassini drives his 1934 Packard 1108 Twelve Dietrich Convertible Victoria onto the winners platform after being awarded the Best of Show award at the Pebble Beach Concours d’Elegance. (Bob Chamberlin / Los Angeles Times)

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Ben Rehm, 20, of Carmel photographs a 1927 Rolls-Royce Phantom I Murphy Convertible Saloon at the Concours d’Elegance on Sunday. (Bob Chamberlin / Los Angeles Times)

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Mitzy from Salinas takes a moment to rest in the shade of a 1955 Lincoln Indianapolis Boano coupe. (Bob Chamberlin / Los Angeles Times)

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A Duesenberg with a tool kit mounted inside the driver’s door is displayed at the Concours d’Elegance. (Bob Chamberlin / Los Angeles Times)

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Photographer Phillippe Carre takes a picture of a vintage Alfa Romeo. (Bob Chamberlin / Los Angeles Times)

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Julia Binke, 6, walks in front of a 1925 Rolls-Royce Silver Ghost at the Concours d’Elegance on Sunday. (Bob Chamberlin / Los Angeles Times)

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Sporting racing-flag toenail polish, Lori TenEyck of Colorado was one of nearly 10,000 people enjoying the display of about 200 collector cars at the Concours d’Elegance. (Bob Chamberlin / Los Angeles Times)

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One of the nearly 200 collector cars greets the dawn as it rolls onto the 18th fairway at Pebble Beach. (Bob Chamberlin / Los Angeles Times)

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Chewing on his cigar, Rick Rawlins drives a 1908 Prince Henry Benz, owned by Ann Bothwell but originally owned by race car driver Barney Oldfield, as nearly 200 collector cars greet the dawn as they roll onto the 18th fairway at Pebble Beach to begin the Pebble Beach Concours d’Elegance. (Bob Chamberlin / Los Angeles Times)

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Spectators line up to see the nearly 200 collector cars at the Pebble Beach Concours d’Elegance. (Bob Chamberlin / Los Angeles Times)

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A rumble-seat passenger in a 1933 V-12 Packard at the Pebble Beach Concours d’Elegance. (Bob Chamberlin / Los Angeles Times)

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Wearing a variety of hats, contestants ride in their Rolls Royce. (Bob Chamberlin / Los Angeles Times)

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Adele Tanaka, left, and Jo Yuan capture the moment as the first of nearly 200 collector cars greets the day to begin the Pebble Beach Concours d’Elegance. (Bob Chamberlin / Los Angeles Times)

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A 1957 Ferrari 250 GT 14-Louver Berlinetta is on display at the Gooding & Co. auction as part of the Concours d’Elegance weekend at Pebble Beach. (Bob Chamberlin / Los Angeles Times)

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A prospective buyer looks down a line of cars up for auction at the Concours d’Elegance weekend at Pebble Beach. (Bob Chamberlin / Los Angeles Times)

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A Shelby 289 Cobra Competition Roadster from 1964 is reflected in the fender skirt of a 1937 Bugatti Type 57SC Atalante at the Concours d’Elegance weekend at Pebble Beach. (Bob Chamberlin / Los Angeles Times)

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At the Concours d’Elegance weekend at Pebble Beach, a 1925 Bugatti Type 35 Grand Prix is on display. (Bob Chamberlin / Los Angeles Times)

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A 1935 Avions Voisin C25 Aerodyne, featuring an early version of a sun roof, is on display at the Concours d’Elegance weekend at Pebble Beach. (Bob Chamberlin / Los Angeles Times)

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Sports Car magazine photographer Dave Tomaro photographs prospective buyers as they spend the afternoon ogling vintage and rare automobiles on display at the Concours d’Elegance weekend at Pebble Beach. (Bob Chamberlin / Los Angeles Times)

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A Bentley radiator ornament at the Gooding & Company auction tent at the Concours d’Elegance weekend at Pebble Beach. (Bob Chamberlin / Los Angeles Times)

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A man uses a camera to get a closer look at the undercarriage of a 1956 Porsche 356 A 1500 GS Carrera Coupe. (Bob Chamberlin / Los Angeles Times)

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Expensive cars are lined up at the Concours d’Elegance weekend at Pebble Beach. (Bob Chamberlin / Los Angeles Times)

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A racing rim signed by Carroll Shelby, the father of the Cobra, in Lynn Park’s garage. (Bob Chamberlin / Los Angeles Times)

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“If one’s good, two’s got to be better,” Park said of the cars, chuckling. (Bob Chamberlin / Los Angeles Times)

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Park stands beside the second Cobra he ever bought. One of his sons is going to race in it. (Bob Chamberlin / Los Angeles Times)

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Park checks the hoses of a Cobra he will take to Pebble Beach. This particular car is worth about $2 million. (Bob Chamberlin / Los Angeles Times)

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Park opens the garage door in front of one of the Cobras he plans to take to Pebble Beach. (Bob Chamberlin / Los Angeles Times)

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Lynn Park with his garage full of Cobra cars. Known in classic car circles as Mr. Cobra, Park has been collecting the marque since he bought his first after getting out of the Army in 1969. The first purchase got him hooked. (Bob Chamberlin / Los Angeles Times)

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Lynn Park keeps his Cobras in his garage in La Cañada Flintridge. He and his sons plan to race race three of them at the Pebble Beach, Calif., event. (Bob Chamberlin / Los Angeles Times)

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“You can’t have any more fun than playing with old cars,” Park said of vintage racing. (Brian van der Brug / Los Angeles Times)

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Lynn Park drives one of his vintage Shelby Cobras around his neighborhood in La Cañada Flintridge. (Brian van der Brug / Los Angeles Times)

By Jerry Hirsch

May 17, 2013 10:25 AM PT

Tesla Motors shares are trading at about $90 and could easily top $100, buoyed by its ability to tap capital markets for about $1 billion through its announced sale of stock and convertible notes.

It is an impressive performance that will help the Palo Alto-based electric car company expand sales abroad, develop its Model X, a sport utility, and start work on a less expensive vehicle that would extend its customer base and manufacturing volumes, analysts said.

It will also use the money to pay off a $465-million Department of Energy loan that became a political hot potato after the 2011 bankruptcy of Solyndra, the Fremont, Calif., solar panel maker, that cost taxpayers more than $400 million.

“What Tesla has accomplished isn’t luck, it’s real,” said Adam Jonas, an analyst with Morgan Stanley Research.

“The Model S is a damn good car,” Jonas wrote in report to investors. “Each day that goes by where Tesla delivers 60 units without images of flaming Model S’s on YouTube offers incremental validation for what it has accomplished.”

The Model S starts at about $62,000 and can top $100,000, depending on trim level and options. The car is stylish and fast, boasting a zero-to-60 mph acceleration of less than six seconds.

Even with the dilution of the current stock offering, Tesla shares could reach $109, Jonas said.

“The auto industry may be in for a shock,” Jonas said. “While Tesla has a long way go, and tremendous risks remain, we may be witnessing an interplay of technology, industrial strategy and capital not unlike Cornelius Vanderbilt and the railroads, or Thomas Edison and electrical distribution.”

Analysts said Teslahas to make sure no technical flaws upend the car’s safety or reliability.Tesla also has to survive a continuing battle with the various auto dealer groups that are contesting its direct-to-the-customer sales model that bypasses car franchises.

Earlier this month, Tesla said brisk sales of its Model S luxury sedan had yielded a first-quarter profit of $11.2 million, compared with a year-earlier loss of $89.9 million.

For the quarter, Tesla was the top seller of rechargeable cars in North America, surging past Nissan Motor Co.’s 3,695 deliveries of the Leaf and General Motors Co.’s 4,421 sales of the Volt plug-in hybrid.

But special California environmental rules, which allowed Tesla to garner $68 million from selling so-called zero-emission vehicle credits to rival automakers, also was a big driver of the profit.

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