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Thread: Tesla: highest valued car company (STOCK SPLIT)

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    Moderator Dr Mordrid's Avatar
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    Lightbulb Tesla: highest valued car company (STOCK SPLIT)

    Higher than the previous #1, Toyota

    Tesla's Q2 delivery numbers have been released. Because of the CoVid-19 shutdown of their Fremont factory expectations were low.

    Market concensus: 72,000

    Actual deliveries: 90,650

    80% of their deliveries were the Model 3 sedan and the new model Y Crossover SUV.

    Tesla close: 1,208.66 USD +89.03 (7.95%)

    Market cap: $224.05 billion

    Former Ford COO & CEO Mark Fields thinks Tesla's going higher because of their technology lead. Some analysts are giving guidance from 1,500-2,000

    If this results in the expected profitable Q2 it's likely they'll join Standard & Poor's 500.
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    Quote Originally Posted by Dr Mordrid View Post
    Higher than the previous #1, Toyota

    Tesla's Q2 delivery numbers have been released. Because of the CoVid-19 shutdown of their Fremont factory expectations were low.

    Market concensus: 72,000

    Actual deliveries: 90,650

    80% of their deliveries were the Model 3 sedan and the new model Y Crossover SUV.

    Tesla close: 1,208.66 USD +89.03 (7.95%)

    Market cap: $224.05 billion

    Former Ford COO & CEO Mark Fields thinks Tesla's going higher because of their technology lead. Some analysts are giving guidance from 1,500-2,000

    If this results in the expected profitable Q2 it's likely they'll join Standard & Poor's 500.
    So a company that sells as many cars in 3-4 days as that Tesla sells in an entire quarter and turns a healthy profit at it, is worth less than Tesla ?
    Makes perfect sense.

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    Crabby Smurf Umfriend's Avatar
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    I am ignorant w.r.t. whether Tesla is over/under valued. However, the metric used, simplified, to value is to look at expected future profits (discounted at a rate appropriate for the systemic risk therein). Ford, Toyota, VW etc. may be big and churn out profits predictably but I can imagine that there is not a lot of upside in expected profits compared to recent history. With Tesla, that may well be different and that may explain it. Having said that, although I believe markets should be seen as rational, that does not mean markets are always right, au contraire.
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    Moderator VJ's Avatar
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    Tesla is I think still valued as a technological sector company rather than a true car company. Realistically, market value does not fully represent company worth; Umfriend has a point: it has more growth potential than current established car companies, which risk of loosing market share to the startups or loosing profits due to necessary investments for new models.
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    Crabby Smurf Umfriend's Avatar
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    Actually, assuming Tesla is values as a tech company (and I will accept that it is), then I would wonder whether it isn't overvalued indeed. The reasoning being that true tech companies, as I see it, are able to generate revenue at low marginal cost, combined with some sort of monopolistic position. At the end of the day, cars are a durable good which means that revenue from a perspective customer has a low repeat rate and marginal cost (producing the car) is high. It is a margin product. With such products, competition, I think, really puts pressure on such margin.

    Edit:
    Quote Originally Posted by VJ
    Realistically, market value does not fully represent company worth
    Even if that is true, what would be a better representation?
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    Moderator Dr Mordrid's Avatar
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    Quote Originally Posted by VJ View Post
    Tesla is I think still valued as a technological sector company rather than a true car company. Realistically, market value does not fully represent company worth; Umfriend has a point: it has more growth potential than current established car companies, which risk of loosing market share to the startups or loosing profits due to necessary investments for new models.
    This.

    What's often ignored is Tesla's technology lead in both EV hardware & software, batteries, and that their Tesla Power subsidiary is really taking off with turn-key utility-scale power storage which could destroy then need for "peaker" generating plants.

    Next up is the testing in Australia of a virtual electric power plant; distributed generation (solar, etc) and storage negating the need for a physical generation plant. This will eventually include homeowners EV's as part of the (massive) virtual storage system.
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    Moderator Dr Mordrid's Avatar
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    Tesla's Berlin Gigafactory is well underway, vertical columns going up and targeting a production start by July 2021. Recently added to the plan is a test track.

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    Moderator Dr Mordrid's Avatar
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    Jesus....

    Monday's close: 1,371.58 USD +162.92 (13.48%), market cap 254.25 billion, and 1,410 in the after-market.

    with forecasts it could hit 2,000+
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    Moderator Dr Mordrid's Avatar
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    New factory timeline

    Giga Berlin (production: mid-2021)
    Giga Austin, Texas (or Oklahoma City)
    Giga Asia 2 (not China)
    Giga ??
    Dr. Mordrid
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    Moderator Dr Mordrid's Avatar
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    Tesla has picked Austin, Texas for its $1.1 billion Cybertruck and second Model Y crossover SUV factory. NO state incentives, and site prep started last Tuesday. Should be building vehicles mid-2021.

    Later in 2021 Tesla will begin building the Roadster 2 hypercar at a new line at Fremont, CA; 0-60 in 1.9sec, 250+ mph, 600+ mile range, and an optional SpaceX Package - 10 gas thrusters for enhanced braking, maneuvering and acceleration. These thrusters are similar to those used on the Falcon 9 rocket.

    Beat the street in Q2, possible joining the S&P 500 index. Closed at 1,592.33, hitting 1,657.00 afterhours.

    https://www.cnbc.com/2020/07/22/stoc...-and-more.html

    Tesla — The automaker’s stock climbed 5% after the market closed. Tesla released second-quarter earnings of $2.18 per share excluding some items on revenues of $6.04 billion while Refinitiv analysts had expected earnings per share of 3 cents on revenues of $5.37 billion. Tesla also reported its first full year of profitability based on GAAP, so the company can now be considered to join the S&P 500 index.
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    Moderator Dr Mordrid's Avatar
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    https://www.cnbc.com/2020/08/11/tesl...ock-split.html

    Tesla announces five-for-one stock split

    KEY POINTS


    * Tesla announced a five-for-one stock split on Tuesday evening.

    * The split goes into effect after the close of trading on August 31.

    * Theoretically, the move could mean more smaller investors could afford the stock, but those investors are minuscule compared to major institutions.

    Tesla*announced a*five-for-one stock split*on Tuesday evening. The split goes into effect on August 31.

    Tesla shares rose more than 6% in post-market trading even though the stock split changes nothing fundamental*about the stock.
    >
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    Stock split usually means price goes up. If you have funds to speculate you may coast on the way up.

    Otherwise once real competition kicks in, Tesla is not doing so well:
    https://wolfstreet.com/2020/08/10/te...up-the-giants/

    But tesla stock price is disconnected from reality for some time now.

    In general stock prices seem irrational. S&P is at it's February all-time high. While Corona is not as bad as it seemed early on, still the unemployment, drag on economy and instabilities that will develop are no reason for stocks being priced the way they are.

    Corona will be around for a year, US-China trade war is ongoing, more countries: Belarus, Thailand, Lebanon and others slip in instability. Even if US drop in GDP won't be as bad, the other countries will affect World economy and I don't think Corona is the last bad thing we will see.
    Last edited by UtwigMU; 12th August 2020 at 14:24.

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    Moderator Dr Mordrid's Avatar
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    Quote Originally Posted by UtwigMU View Post
    Stock split usually means price goes up. If you have funds to speculate you may coast on the way up.

    Otherwise once real competition kicks in, Tesla is not doing so well:
    https://wolfstreet.com/2020/08/10/te...up-the-giants/
    >
    Tesla's sales in Germany are volume limited to what Fremont can ship there and meet US and other non-China obligations. Also; Germany increased EV subsidies, so Tesla not having more to deliver people bought the available options.

    This scenario changes drastically next year when Giga Berlin opens, which may happen in Q2 or Q3. Construction there is moving even faster than Shanghai did.

    There's also Giga Texas in Austin, which is also under construction and targeting later in 2021. Model 3 and Cybertruck, and there are European orders for the big beast.
    Last edited by Dr Mordrid; 12th August 2020 at 18:56.
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    Moderator Dr Mordrid's Avatar
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    Tesla closed today at 2,213.40 and has been stable after-hours at about 2212.00, meaning it should open Monday (post-split) at ~442.00 with a valuation of $412 billion.
    Dr. Mordrid
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    Moderator dZeus's Avatar
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    Quote Originally Posted by Dr Mordrid View Post
    Tesla closed today at 2,213.40 and has been stable after-hours at about 2212.00, meaning it should open Monday (post-split) at ~442.00 with a valuation of $412 billion.
    looking also at the wider market for shares in the tech sector (AAPL being the elephant in the room), it seems clear that something is seriously wrong with valuations.

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