Tesla Inc. (TSLA) has recently rallied sharply after the company announced on Jan. 14 that its revenues for the quarter ended Dec. 31, 2013 exceeded its expectations by approximately 20 percent. According to the company, Tesla sold almost 6,900 vehicles during the quarter.

Interestingly, the company failed to mention anything regarding its fourth-quarter earnings.

My guess is that’s because its earnings were either unchanged or declined during the quarter. Otherwise, there wouldn’t be any reason for Tesla to not mention its net operating results.

Another thing that I find interesting about Tesla’s revenue announcement is that I’m having trouble in determining how Tesla’s revenues exceeded its expectations by almost 20 percent.

In a report that the company filed with the Securities and Exchange Commission on Nov. 5, 2013, Tesla said that it had planned to deliver slightly under 6,000 of its Model S sedans during the quarter ending Dec. 31, 2013.

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So, let’s assume for the moment that Tesla had expected to deliver 5,975 vehicles during the quarter ended Dec. 31, 2013 – that’s “slightly under 6,000.”

Let’s also assume that Tesla ended up selling 6,875 vehicles during the quarter – that’s “almost 6,900” that the company stated in its Jan. 14 news release.

If that were the case, the actual number of vehicles sold by Tesla during the quarter ended Dec. 31, 2013 would translate into an increase of only 15.1 percent, which is nowhere near the “approximately 20 percent” increase stated by Tesla in the news release that it issued this past Tuesday.

Now, I’m not suggesting that Tesla is trying purposely to mislead investors. I’m simply saying that the math doesn’t make sense.

For example, let’s make some slightly different assumptions regarding the sales expectations that Tesla reported on Nov. 5, 2013 and the actual number of sales that the company mentioned in its Jan. 14 news release – let’s assume that by the phrase “slightly under 6,000” vehicles that Tesla mentioned in its Nov. 5 filing meant 5,950 vehicles instead of the 5,975 number that I used above.

And, let’s assume that the actual number of vehicles that Tesla sold was 6,850 instead of the 6,875 figure that I used above.

Still, the difference between 6,850 and 5,950 is still only 15.1 percent - substantially less than the approximately 20 percent revenue increase that Tesla stated in its Jan. 14 news release.

In my opinion, a difference of that magnitude is a big “red flag.”

Now, in all fairness, Tesla stated that its revenues, as opposed to the number of vehicles that it sold, rose by approximately 20 percent during the quarter ended Dec. 21, 2013. But, in order for the company’s revenues to increase by 20 percent without the number of vehicles that it sold increasing by a similar percentage, Tesla would have needed to either raise its sales prices substantially and/or to reduce its operating expenses substantially.

My research indicates that neither of those developments occurred.

First, the prices for different versions of the company’s Model S were approximately the same during the past three months that they were during the prior quarter.

Secondly, Tesla stated on Nov. 5, 2013 that it expected its research and development expenses, which accounted for 12 percent of the company’s revenues during the nine months ended Sept. 30, 2013, to rise by approximately 25 percent during the quarter ending Dec. 31, 2013, as compared to the prior quarter.

In regard to the company’s fourth-quarter earnings, Tesla said on Nov. 5 that it expected the company’s “non-GAAP profitability to be about consistent with Q3” – that it did not expect its earnings to rise during the quarter ending Dec. 31, 2013.

Once again, I am not in any way suggesting that Tesla is purposely misleading investors. I’m just saying that the math doesn’t work out well.

With Tesla’s stock trading at a price-to-revenues multiple of approximately 12-to-1, financial-market participants appear to be over-valuing Tesla’s stock substantially.

Therefore, I would encourage investors and speculators alike to avoid putting any of their money in that over-hyped stock.

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David N. Frazier has an extensive background in the investment securities industry and has invested in the financial markets for more than 25 years.

In addition to working as a business analyst, merchant banking analyst and equity research analyst, he’s held positions in sales and marketing at institutional investment firms, including William O’Neil & Co., TDAmeritrade, and Merrill Lynch.

David now serves as the President and Chief Market Strategist of Frazier & Mayer Research, LLC (dba www.TheMarketMonk.com), an independent investment research firm that provides research and analytical services to hedge funds, investment advisory firms, and other investment newsletters.