Tesla will need to raise more than $10 billion in capital through 2020: Goldman Sachs

Tesla Inc. will need more than $10 billion in capital raises and debt refinancing by 2020, Goldman Sachs analysts said Thursday. That is the sum needed to fund its current operations, new product spend and capacity additions, analysts led by David Tamberrino wrote in a note. It includes Goldman's expectation that Tesla will launch a new vehicle manufacturing plant and gigafactory in China. "We believe this level of capital transactions may be funded through multiple avenues, including new bond issuance (secured and/or unsecured), convertible notes, and equity," the analyst wrote. "We see several options available to the company to refinance maturing debt and raise incremental funds, which should allow Tesla to fund its growth targets." Issuing more debt may weigh on the company's credit profile, while issuing equity or convertibles would dilute the current shareholders, said the note. "Our preference is to express long views via the front-end convertible credit - and we continue to express a bearish view on the equity." Shares were slightly lower premarket and have fallen 8% in the year so far, while the S&P 500 has gained 2%.