Will TSLA stock plummet?
Title says it all. I don’t know anything about TSLA or it’s fundamentals so I’m hoping some of you who are informed on this can comment. Is TSLA seriously overvalued or is the stock fairly priced in you opinion? I’m surprised at how much it keeps going up and up. I remember back in January when reaching $177 was such a big deal, and now it’s at $695. What’s going on?
I think various aspects played into it
- unique product, with good supercharger network; also first to market with mass volume, high adoption product
- Tesla are advanced in many areas like autonomous driving; tried the autopilot and it really impressed me
- decent sales figures despite pandemic
- inclusion in S&P500 (last weeks)
- I worked for OEMs before; they are slow, big, traditional. Tesla is managed and valuated like a tech company
- faster innovation to market (through OTA and flexible approach /w SW)
- they develop & own their hardware like batteries and more; other OEMs lean more on suppliers
- there were various insurance job advertisements for Tesla in major EU markets and the US; they are working on hyper-customized car insurance programs!
Leadership:
Elon is not like all the conservative, slow managers at other OEMs. He sets far higher goals, hires the best and manages to achieve them. The other companies he is running also play a role. If a guy who founded Paypal can land on Mars, he can absolutely take Tesla to the next level.
I think $TSLA will go up further.
edit: also trending today: https://twitter.com/i/events/1339934893996978176
You forgot the biggest factor: teenage Robinhood users buying a shitload of calls with their parent's credit cards
Can confirm
If a stock's price is the present value of future cash flows then maybe the young RH investors' behavior should tip you off that there is something to Tesla.
If it will, it won't be any time soon. Obviously we're on course for perpetual money printing and with many people unemployed and sitting at home, and most people chasing the media and shiny stocks without thinking for themselves, companies like Tesla will probably keep trending upward.
Was thinking about buy puts on TSLA with $650 strike to expire Feb
Also, just throwin' this out there, but most people who drive a Tesla for 30 minutes end their skepticism of the stock. It's really just a next-level product that you can't really appreciate until you get behind the wheel. My mother was debating between vehicles and spent literally 5 minutes in my new Model 3 with me and said, "Decision made. I'm getting a Tesla."
yeah i test drove one for the first time earlier this year, incredible
It's a different level car. A simple thing like a big touchscreen in the middle instead of all the buttons makes a world of a difference. Not even mentioning how smooth the drive is
@real_Skankhunt42" in your opinion, how old is too old and how many miles are too many for a used Tesla if someone were in the market for a used car. In just a very quick search, I see a few used 2012-2014 Model S going for about $25K and higher. On the contrary, I see a bunch of 2018-2019 Model 3s with far less miles but average seems to hover around the $35K mark.
Curious to get your thoughts on the longevity of the car itself and what overall value it can bring all-in (maintenance costs, insurance costs, fuel costs - which you've already touched on).
Waddup, Cathie Wood
Jim Chanos is typing...
My only regret is that I didn’t buy more of Tesla baby.
buy puts this joke gonna end soon
It’s the 5th largest holding in the S&P, and what fundamental analysis thinks it should get a 1000+ PE ratio. Note... stocks included in the S&P sink on average by 18% in the 12 months following their inclusion in the index.
It's obviously overvalued on fundamentals, it barely squeaked a GAAP profit by selling environmental credits in order to get added to the S&P. It's a perpetual motion machine right now and has been for a while, but eventually it will have to stop and the underlying company isn't worth 0 but it's worth a hell of a lot less than is currently priced in. Trying to time the collapse is a fools errand though so best choice would be to just watch. Most of us weren't around for the tech bubble so this is a narrower, modern equivalent to learn from.
I don’t know the trading volume but they only have 500k orders this year? The GenZ Tesla simps should convince their parents to buy a Tesla for them to boost up sales
It definitely is overvalued and I flat out refuse to take anyone seriously who thinks otherwise, but that absolutely doesn’t mean the stock is going to go down in the short-medium term. The market can remain irrational longer than you can remain solvent.
tough to short a cult ie herbalife
Elon Musk is one of the greatest stock promoters of all time. It might drop but I think it will stay very very overvalued relative to earnings for a long time.
What's brilliant about him is putting out news from his other companies strategically to get the RH kids excited and buying stock. IE they see his brain implant co do something cool and now want to back him...but the only way is with tesla stock.
Yeah, Elon musk often under-delivers on promises, and the market is overhyping it. It doesn't necessarily need to 'plummet' but it can be pricing in its future growth and remain stagnant for the future. I wouldn't buy puts (given the speculative nature of them), but if you wanted to short sell and wait for Q1 earnings, there could be some profit-taking after such a big year if the results aren't as great as expected.
Full disclosure--I have a somewhat significant position in Tesla and am a Model 3 owner.
Tesla is either grossly overvalued or grossly undervalued. Tesla's valuation is ALL about its potential robotaxi fleet. If Tesla FSD succeeds and it can launch a popular robotaxi fleet, the company should be valued in excess of $2 trillion. On the other hand, if the robotaxi concept fails, there is absolutely no economic justification whatsoever for its value--in that case, it SHOULD be worth less than $100 billion.
Needless to say, since I'm long I'm obviously a believer in the robotaxi concept and in Tesla's ability to pull it off. A lot of people wrongly assume Tesla's valuation is divorced from reality, but the truth is, it's priced exactly where it should be--if its robotaxi fleet is successful there is a 3x return potential right now; if not, there is a potential to fall 80-85%. The chances of Tesla pulling off a robotaxi fleet right now are, in my view, about 75%. If you've seen any FSD beta videos recently, you'd understand why I'm long on Tesla FSD.
Can you explain robotaxi?
Sure. Inside each Tesla vehicle is a hardware package capable of running Tesla's full-self driving software. Right now, the FSD is in beta mode, but if you check out its beta users' videos online, it is damn close to being L5 capable. Not quite there--1-2 years away, but close. At the flick of a switch, Tesla can turn on FSD and have 1 million vehicles at its disposal. In 2021, Tesla is delivering another 1 million vehicles. By the end of 2022, Tesla will have an army of about 3.5 million vehicles capable of FSD at Level 5 or close to it. In the US alone, 3.3 trillion miles are driven each year. Tesla wants to capture several hundred billion of those miles at $0.50-1 per mile.
Mile charges combined with ads and business partnerships/promotions, the amount of revenue a robotaxi service is capable of producing boggles the mind. It's why some people have a $2+ trillion valuation target on Tesla. Everyone else is blinded by the quarterly sales figures and profits on sales. That's yesterday's business model and should have nothing to do with the price of a Tesla stock.
Would be interested to hear views on Telsa's technology choice to primarily use cameras for autonomous driving vs LIDAR. Zoox (AMZN) and rumored APPL cars seem to use LIDAR. My understanding is that LIDAR costs more (e.g., Zoox vehicle reported to costs $200-300k, of which LIDAR is one component).
I'm a Lidar proponent as it operates as a form of redundancy. Lidar will be between $100 and $1,000 within the next few years. My guess is that Tesla will ultimately affix lidar to its vehicles once the cost comes down.
You’re weighing a 3x return on a FSD robotaxi fleet? I love the cars and the beta tests are cool, but damn I wish I had your conviction. I’d be shocked if that kind of tech is 15 years away, let alone 1-2. Running auto on a preplanned route in SoCal is one thing, but navigating Boston construction in a blizzard is an entirely different story, not to mention implementation, adoption, and execution.
I hope you’re right because I would love to see it, but this screams asymmetric risk-reward to me (and not in a good way)
Lmao, it's definitely not 15 years away. Waymo is running a paid service in greater Phoenix right now. Baidu and AutoX both launched actual services in China in 2020. Motional has a service in Las Vegas right now. Tesla is probably going to launch its service beginning in 2022 (but what if it's 2025? That doesn't REALLY impact the DCF much because they only have 1 million cars on the road today, not close to enough to run a robotaxi service since only a fraction will be on the network--they probably won't have enough cars for a ubiquitous service until 2025+, so who cares if they launch in 2025 or 2022? Makes no real difference). Look at Tesla FSD beta videos that users are posting online. They're incredible. They aren't perfect performance yet, but 12-36 months of weekly updates will create a pretty stunning capability.
A robotaxi service does not require Level 5 capability to operate. If Boston is too difficult than you don't operate in Boston. If the weather is really bad, you don't operate in the bad weather. That leaves 8-9 months a year of pretty good weather. The business model isn't rocket science.
I don't know how much of it this is true, since Titan was delayed multiple times already. But if AAPL pulls this off they might take away a small market share of Tesla.
https://www.macrumors.com/2020/12/21/apple-car-production-rumored-2024/
100,000 vehicles annually wouldn't even dent the market of Tesla.
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