Author Topic: TSLA - Tesla Motors  (Read 1059179 times)

Dalal.Holdings

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Re: TSLA - Tesla Motors
« Reply #4290 on: November 26, 2020, 06:00:44 AM »
Thinking TSLA's valuation today is justified is about as silly as thinking it should have been worth only $20-30b last yr (or better yet, $10 per share or $0)...

The right answer is somewhere in between.


longinvestor

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Re: TSLA - Tesla Motors
« Reply #4291 on: November 26, 2020, 06:14:33 AM »
Scary
Some 9 years ago, Apple surpassed long-time heavy weight champion Exxon in market cap.
I am sure back then it made no sense seeing a phone maker surpass an industrial giant in a pre-shale oil and gas environment. Yet market saw it correctly.

While I hope Tesla will continue to push to change the work, I just hope 10 years from now Berkshire won’t be as irrelevant as Exxon is today.

Perhaps this belongs in the thread that talks about BRK 10 years from now

Based on stock price? Or on earnings ? At current trajectory, expect BRK’s economic earnings to have passed $100 Billion. And perhaps the earnings coffers filled with a cumulative  half a trillion .

Gregmal

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Re: TSLA - Tesla Motors
« Reply #4292 on: November 26, 2020, 07:17:43 AM »
If you've got an itch to short the bubble, perhaps finding something that hasn't proven to be resilient and more or less bullet proof for nearly a decade makes sense. The only way to make money shorting Tesla is to more or less nail every facet of the trade, specifically, right down to the timing. And if thats something you have confidence in your ability to do, there's almost certainly higher upside trades to put on, that would likely coincide with the same catalysts.

kab60

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Re: TSLA - Tesla Motors
« Reply #4293 on: November 26, 2020, 07:51:51 AM »
It's quiet fascinating how detached from reality this has become, but one could've said that on most of the way up. With S&P inclusion, and continued flows into passive funds from active funds, I have no idea how long this will go on.

I can understand the craziness about SAAS, though not most valuations, cause selling business software can be a fantastic business (yet I wonder whether a lot of these highfliers are really all that sticky and won't get quashed by the Microsoft or new "disruptors"), but there's nothing fantastic about producing cars.

Teslas numbers tells the story of what this really is - a subscale auto manufacturer. It's not even a good industry if you're massive. Still can't quiet fathom how putting a large battery inside the car changes that dynamic. The only really good business is the one of selling luxury cars ala Ferrari, but Tesla is obviously going massmarket and thus in a complete different direction. Despite a couple of fanatical Elon fanboys I also don't see much brand affinity here in Europe.

The recent sales numbers I saw from Europe and China also doesn't exactly scream total domination. The complete opposite actually with some competitors finally waking up and launching what seems like decent vehicles. But it seems like even that doesn't matter for the narrative. I've even seen some say increased competition strengthens the case, because it shows EV's are the future.

The Elon Halo is massive. Has there ever been this big of a key man risk in the market?

At some point I suppose it'll collapse under its own weight. Possibly after S&P inclusion. But who knows. All I know is to stay the heck away.

JRM

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Re: TSLA - Tesla Motors
« Reply #4294 on: November 26, 2020, 09:21:38 AM »
Did you guys forget that Elon is going to squeeze lithium out of sand?  Probably with his bare hands.

Did you guys forget that we are weeks away from 1 million robo-taxis?  You will be able to summon your car from across the country.

Elon solved the solar tile puzzle back in 2017 that had been eluding bone-headed engineers for years.


A Dhandho Investor

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Re: TSLA - Tesla Motors
« Reply #4295 on: November 27, 2020, 03:58:15 AM »
Better late than never? https://de.reuters.com/article/us-tesla-safety-investigation/u-s-agency-opens-probe-into-115000-tesla-vehicles-over-suspension-issue-idUSKBN287172

Result of the investigation: "The NHTSA believes that the issue is related to driver abuse. US drivers are as bad drivers as Chinese drivers"

Quote
The agency said it was opening a preliminary evaluation into 2015-2017 Model S and 2016-2017 Model X vehicles after receiving 43 complaints alleging failure of the left or right front suspension fore links.

Tesla in February 2017 issued a service bulletin describing a manufacturing condition that may result in front suspension fore link failures, NHTSA said.

Simba

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Re: TSLA - Tesla Motors
« Reply #4296 on: November 27, 2020, 07:16:09 AM »
If you've got an itch to short the bubble, perhaps finding something that hasn't proven to be resilient and more or less bullet proof for nearly a decade makes sense. The only way to make money shorting Tesla is to more or less nail every facet of the trade, specifically, right down to the timing. And if thats something you have confidence in your ability to do, there's almost certainly higher upside trades to put on, that would likely coincide with the same catalysts.

I know you know this already, but reminding everyone "The market can remain irrational longer than you can remain solvent".

Professor Damodaran updated his Tesla valuation with a DCF model (he bought the stock and sold).

His valuation is quite detailed and puts a lot of thought into it, I will quote his blog post. Even in his blue-sky scenario of giving them best of breed revenue ($300B), best of breed operating margins (21% - unheard of for capital intensive industry), his price target is much lower than the price today (approaching $3000 pre-split).

"The Make-your-best Company: In this variant, I give Tesla the best possible outcomes on each variable, revenues like VW/Toyota, margins like pure software companies (21.24%), a sales to capital ratio that is higher than any of the sector averages (4.00) and a cost of capital of an auto company (6.94%), and arrive at a value per share of $2106."

http://aswathdamodaran.blogspot.com/2020/02/a-do-it-yourself-diy-valuation-of-tesla.html

I don't know how long this party ends (1 month, 3 months, 12 months, 2 years, 5 years, 50 years), but my own feeling, is the party will end.

In my limited experience, bubbles do end, however, like we saw in 1998-2000, they can last longer than most people think.
« Last Edit: November 27, 2020, 07:20:39 AM by Simba »

Simba

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Re: TSLA - Tesla Motors
« Reply #4297 on: November 27, 2020, 07:27:37 AM »
Scary
Some 9 years ago, Apple surpassed long-time heavy weight champion Exxon in market cap.
I am sure back then it made no sense seeing a phone maker surpass an industrial giant in a pre-shale oil and gas environment. Yet market saw it correctly.

While I hope Tesla will continue to push to change the work, I just hope 10 years from now Berkshire won’t be as irrelevant as Exxon is today.

Perhaps this belongs in the thread that talks about BRK 10 years from now

The issue in my view is the risk / reward

Apple EV was $618B* in Q42018 and generated close to $60B* of Net Income (going off of my financial software)
Tesla EV is $566B* today, and generated net income of $0.5B* of Net Income (going off of my financial software - didn't go directly to fillings so #s could be off)

Investing in Apple was completely different than investing in Tesla from a valuation point of view

At close to the same EV level, Apple has multiples more of OI, NI and CF (and were talking about a massive delta, not 1-2 turns, but potentially 100 turns difference)

*(going off of my financial software - didn't go directly to fillings so #s could be off)
« Last Edit: November 27, 2020, 07:29:24 AM by Simba »

Libs

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Re: TSLA - Tesla Motors
« Reply #4298 on: November 27, 2020, 11:59:54 AM »
<It is probably not unreasonable to expect this to trade up to 2 trillion when Elon announces that he has invested Tesla's excess cash in bitcoin.>

I had to laugh at this. I am long Bitcoin and short Tesla ( with play money; I'm not completely mad). A rare combination.
My username is not a political statement.....and I'm too lazy to change it.

alpha

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Re: TSLA - Tesla Motors
« Reply #4299 on: November 27, 2020, 02:41:39 PM »
I have an elderly relative who was a pretty savvy business man in his prime. Our family set him up with a smart TV a few year ago which allows him to watch Youtube videos on the TV. At some point about 20 months ago he watched an electric vehicle video on Youtube and ever since then the Youtube suggestion algorithms have bombarded him with "Tesla News" videos produced by people trying to collect referral fees. Despite our efforts to explain to him that these were biased videos, he became convinced by these "experts" that Tesla was a game changer on the brink of world domination. Earlier this year for the first time in 50 years he walked down to his bank branch, opened a brokerage account and purchased 25k worth of Tesla stock.

It has been very disturbing to basically observe an app brainwash a comfortably retired person into believing they need to act now and buy this stock even when they have no need for money. I have read many accounts of various investment manias that have occurred over history but this sure seems like a new one.