's (NASDAQ: TSLA) stock has risen nearly 115% since the beginning of the year. Its improving sales and work on AI made the company increasingly popular with investors.

Still, recent price cuts have reduced its margins, and the dramatic move higher over a short time increases the likelihood of a pullback. Does that possibility make it a stock to avoid? Let's take a closer look.

Tesla just released its Q2 earnings report, and in many ways, it highlights why its gains are so significant. Its $25 billion in revenue increased 47% versus the same quarter last year. Also, the 480,000 vehicles it delivered during the quarter surged 86% higher. Moreover, free cash flow rose 62% to $1 billion as operating income accelerated amid slowing growth in capital expenditures.

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Source Fool.com