Jim Cramer Says He Was 'Wrong' About Tesla Being A 'Cult Stock'

Tesla Inc TSLA received high praise from the CNBC “Mad Money” host Jim Cramer on Thursday in the aftermath of the company reporting third-quarter earnings.

What Happened: “They have left the old-school automakers in the dust,” Cramer said, analyzing the Q3 results of the Elon Musk-led company.

Cramer said he was "wrong" about counting Tesla among his list of cult stocks. “It’s not a cult stock, as I once thought,” the former hedge fund manager said.

Earlier this week, the CNBC host had noted, “I’ve always said Tesla’s a cult stock, even after I joined the cult last year. That shareholder base isn’t going anywhere and neither am I.”

The former hedge fund manager pointed out that only about a year ago people were expressing concerns about Tesla being functionally bankrupt, and now one could argue that the electric vehicle maker has “got the best balance sheet in the industry.”

Why It Matters: Tesla reported third-quarter revenue of $8.77 billion, a year-over-year increase of 39% with earnings per share of 76 cents which beat estimates of 56 cents. The automaker says it is set to deliver 500,000 vehicles in the current fiscal year.

Needham analyst Rajvindra Gill has questioned the delivery guidance and called it “highly ambitious.” 

The Palo Alto-based automaker to grow fourth-quarter deliveries by nearly 30% quarter-over-quarter versus a three-year average increase of 13% in the fourth quarter in order to meet the target as per Gill.

Jefferies analyst Philippe Houchois also called the goal “challenging.”

Price Action: Tesla shares closed 0.75% higher at $425.79 on Thursday and gained 0.16% in the after-hours session.