Tesla is down 1.58% on Wednesday as investors prepare for its second-quarter earnings report to be released after the bell.
The electric automaker is expected to lose $2.34 a share on revenue of $2.51 billion, according to data from Bloomberg.
Analysts are mixed on the company. 44% of analysts surveyed by Bloomberg are neutral while 32% are bullish and 24% are bearish. The company's high valuation is one of the primary criticisms from investors. Even CEO Elon Musk recently suggested shares are overvalued.
Bullish investors are pricing in a successful launch of the company's newest car, the Model 3. The company delivered its first round of Model 3s at the end of July, and is starting to ramp up its production schedule to meet the 500,000 cars in its preorder backlog.
The Model 3 is widely viewed as Tesla's path to profitability. The company has lost money in nearly every quarter since its 2010 initial public offering. The mass-marketed Model 3 is the first car to be priced at the lower end of the auto market, at $35,000 before tax incentives.
Tesla hopes to be producing 20,000 vehicles a month by the end of the year. Customers who order a Model 3 today will be looking at a mid-to-late 2018 delivery date, according to the company.
Bearish investors find it hard to see past the company's history of losses. David Einhorn, the hedge fund billionaire who is perhaps the loudest bear on Tesla, has said the company has only enough cash to survive for the next three quarters. Tesla is expected to burn through $2 billion this year, according to Einhorn.
Short sellers have been taking it on the chin as of late. Tesla has risen 44.75% this year, while maintaining its status as the most shorted stock on the market. Investors are growing tired of waiting for the Tesla hype to cool, though, and short interest is at its lowest point in years.