Tesla Surges Above $500, Leaving Analyst Targets in the Dust • Hacker News Board

Re: Tesla Surges Above $500, Leaving Analyst Targets in the Dust

#111

Post by MrPowers » Mon, Jan 13, 2020, 4:52 PM UTC

kbutler wrote: post #76

bryanlarsen wrote: post #23

Earlier quoted context omitted.

If you google "ford enterprise value" and "tesla enterprise value" you get values of 156B and 86B, respectively. Stockholders are not the only people who have claims on the liquidation value and future profits of a company. Bondholders and pensioners do as well. Market cap != valuation.

Right, those other claim holders represent reductions in the value of the company. If I borrow $300 billion (heh) and call myself a car company, that doesn't make me a more valuable company than Ford and Tesla combined - my net worth hasn't changed. Market cap == (perceived) value. Enterprise value is the COST TO PURCHASE the company, if I'm considering buying it. Like buying a used car and assuming payments: enterpr…

The enterprise value is the value of a company.

enterprise_value = market_cap + debt - cash

Different companies are capitalized differently - some use all equity, some all debt, some a mix.

Not sure I agree that other claim holders represent reductions in the "value of the company". The same company can be capitalized different ways - the enterprise value for that company should be unchanged.

Re: Tesla Surges Above $500, Leaving Analyst Targets in the Dust

#112

Post by chasd00 » Mon, Jan 13, 2020, 4:52 PM UTC

jansan wrote: post #51

Anyone remember Volkswagen shares at 1000€ in October 2008? This was a textbook example of a shortsqueeze. One German billionaire saw that the share value was at a ridiculous high level, so he shorted it. He was correct, but too early, so he lost all his money and committed suicide. https://ftalphaville.ft.com/2018/10/31/1540962002000/The-day...

"markets can remain irrational longer than you can remain solvent"

Re: Tesla Surges Above $500, Leaving Analyst Targets in the Dust

#113

Post by nordsieck » Mon, Jan 13, 2020, 4:52 PM UTC

jansan wrote: post #89

jppope wrote: post #55

Earlier quoted context omitted.

Here's what you're missing... Most of the major automakers: Ford, Toyota, Honda, Nissan, Mazda, etc do not have viable business models in the near future. They are so far behind in sustainable transportation its only a matter of time until they lose their economies of scale and are no longer viable businesses. It's an "Iphone moment"... the other car companies have great "flip phones" right now.

iPhones did not need a charging network. They did not have any disadvantages besides the high price, which made them even more desirable. But I just do not see average people who live in condos buy an EV anytime soon.

> But I just do not see average people who live in condos buy an EV anytime soon.

Depending on where you live, there are sometimes EV charging spots in apartments/condos. To me, this is pretty clearly a supply/demand issue.

Today, there aren't enough EV drivers for condos to care, but as the percentage of people who own EVs increases, more places will install chargers. It's the exact same process that resulted in gas stations being everywhere.

Re: Tesla Surges Above $500, Leaving Analyst Targets in the Dust

#114

Post by seanmcdirmid » Mon, Jan 13, 2020, 4:52 PM UTC

NotSammyHagar wrote: post #99

jansan wrote: post #89

Earlier quoted context omitted.

iPhones did not need a charging network. They did not have any disadvantages besides the high price, which made them even more desirable. But I just do not see average people who live in condos buy an EV anytime soon.

it's certainly a little inconvenient but people are already buying evs who live in condos in Seattle and San Francisco and probably other places. Don't forget apartments, they have the same issue

The higher end apartment buildings are getting chargers here in the Seattle area, while the lower ones are still slow on the uptake. It is just a matter of time now, anyways.

Re: Tesla Surges Above $500, Leaving Analyst Targets in the Dust

#115

Post by woofcat » Mon, Jan 13, 2020, 4:53 PM UTC

aerovistae wrote: post #101

woofcat wrote: post #64

Earlier quoted context omitted.

>From my seat, that really remains to be seen. The existing companies don't seem to have found a way to compete with Tesla's EVs yet. They may get there eventually, but Tesla has it now. This somewhat reminds me of BlackBerry. They're basically the only game in town right now, and thus maintain a market advantage. However as larger companies shift to EV's as the technology matures how will Tesla be able to maintain i…

No! No, no, no. This will not happen. It's a total pipe dream. These ancient companies, so set in their ways, who have been incrementally making tiny adjustments to their cars for decades, will never "suddenly leap forward" to come out with something more advanced and more appealing than a Tesla. Tesla isn't the blackberry here, the other car companies are! You're basically the guy in 2008 saying "sure Apple has an a…

>You're basically the guy in 2008 saying "sure Apple has an advantage now, but what will they do when Blackberry catches up and shifts to touchscreen based phones?"

Not really. BlackBerry basically invented the smartphone, and introduced it to market success. We're talking pre-2008 BlackBerry is Tesla today.

Tesla basically invented the EV, and is leading the market.

Re: Tesla Surges Above $500, Leaving Analyst Targets in the Dust

#116

Post by ajross » Mon, Jan 13, 2020, 4:53 PM UTC

woofcat wrote: post #64

kemitche wrote: post #39

Earlier quoted context omitted.

> who can compete with Tesla From my seat, that really remains to be seen. The existing companies don't seem to have found a way to compete with Tesla's EVs yet. They may get there eventually, but Tesla has it now. Regarding valuation, one point I read elsewhere is that Tesla does a lot more in-house, which adds to the valuation, whereas the existing companies will buy a lot of their parts and/or contract out work. I…

>From my seat, that really remains to be seen. The existing companies don't seem to have found a way to compete with Tesla's EVs yet. They may get there eventually, but Tesla has it now. This somewhat reminds me of BlackBerry. They're basically the only game in town right now, and thus maintain a market advantage. However as larger companies shift to EV's as the technology matures how will Tesla be able to maintain i…

Tellingly, though, Blackberry failed not in the face of emerging competition from the existing establishment (e.g. Nokia and Palm) but because it got one-upped by another, even more innovative platform by a newcomer to the mobile market.

I mean, I agree that at some point Tesla is going to get beaten. But to argue that GM or Toyota will do it seems... less likely.

Re: Tesla Surges Above $500, Leaving Analyst Targets in the Dust

#117

Post by ivankirigin » Mon, Jan 13, 2020, 4:53 PM UTC

brenden2 wrote: post #7

How do Tesla owners feel about the quality of their cars? I'm genuinely curious. This is merely an anecdote, but in my experience it seems like the overall quality of similarly priced automobiles from more traditional luxury carmakers is much higher. The only significant advantage of the Tesla is the fact that it's 100% electric. Also, this is merely a subjective personal preference, but I just don't like the style o…

I have had 3 electric cars: Chevy Volt, Tesla Model 3, and Jaguar IPace.

The Volt was the worst quality, but a total cost of ownership over 3 years of around $11K, including lease payments, insurance, and gas, but excluding charging.

The IPace is worse than the Tesla at around the same cost. It's worse range is really difficult if you don't have a fast charging setup. The software is obviously not built by a software company.

The Model 3 feels light, and goes far. The lack of physical controls make for a clean design. It can move like a muscle car but is obviously completely silent.

The Tesla sales and support has been terrible. There are obvious growing pains, and it's one reason we got the IPace. Long term those rough edges will smooth out.

Re: Tesla Surges Above $500, Leaving Analyst Targets in the Dust

#118

Post by NotSammyHagar » Mon, Jan 13, 2020, 4:53 PM UTC

kbutler wrote: post #76

bryanlarsen wrote: post #23

Earlier quoted context omitted.

If you google "ford enterprise value" and "tesla enterprise value" you get values of 156B and 86B, respectively. Stockholders are not the only people who have claims on the liquidation value and future profits of a company. Bondholders and pensioners do as well. Market cap != valuation.

Right, those other claim holders represent reductions in the value of the company. If I borrow $300 billion (heh) and call myself a car company, that doesn't make me a more valuable company than Ford and Tesla combined - my net worth hasn't changed. Market cap == (perceived) value. Enterprise value is the COST TO PURCHASE the company, if I'm considering buying it. Like buying a used car and assuming payments: enterpr…

If you borrow $300 billion you still have $300 billion in assets. Unless something unexpected changes, Ford won't be able to realize that Enterprise value. The number of car companies will shrink, not grow, evs are just the wave over the horizon that will really hurt them. Tesla actually has a chance to drastically grow their sales.

Re: Tesla Surges Above $500, Leaving Analyst Targets in the Dust

#119

Post by throwawayhhakdl » Mon, Jan 13, 2020, 4:53 PM UTC

bryanlarsen wrote: post #23

oliverx0 wrote: post #11

According to Robinhood: “Tesla's stock has jumped 35% over the past month, becoming the most valuable American car company ever. GM and Ford produced a combined 39x as many cars as Tesla did in 2019, but the electric carmaker is now more valuable than GM and Ford combined. Oh, and Tesla lost almost a billion dollars over the past year while GM and Ford made over $10B in profit. Investors care more about future profit…

If you google "ford enterprise value" and "tesla enterprise value" you get values of 156B and 86B, respectively. Stockholders are not the only people who have claims on the liquidation value and future profits of a company. Bondholders and pensioners do as well. Market cap != valuation.

Hmm that sounds misleading for the conversation at hand.

If enterprise value is market cap - debt (forget cash) then you’re saying this is the net dollar value of owning every share of Tesla.

But “rational” investors are aware of debt. It would seem to me you should be adding the debt to the perceived future earnings to actually come up with gross expected income.

That is if I buy Tesla and Ford for $10 each, and the Ford has no debt, and the Tesla has $10 debt, and I pay $10 because I consider them equal value... that would mean you expected total future earnings from holding each to be $10 from Ford and $20 from Tesla.

Re: Tesla Surges Above $500, Leaving Analyst Targets in the Dust

#120

Post by logicIsTruth » Mon, Jan 13, 2020, 4:53 PM UTC

scrozier wrote: post #56

brenden2 wrote: post #7

How do Tesla owners feel about the quality of their cars? I'm genuinely curious. This is merely an anecdote, but in my experience it seems like the overall quality of similarly priced automobiles from more traditional luxury carmakers is much higher. The only significant advantage of the Tesla is the fact that it's 100% electric. Also, this is merely a subjective personal preference, but I just don't like the style o…

My wife has a model 3. I have a BMW 535i. I used to love my BMW. Now I beg my wife to drive the Tesla, because the BMW feels like a clunky dinosaur. I agree that Teslas are generally not the most beautiful cars, but the torque, the handling, the software-driven features, and the lack of gas station stops makes up for it, and more. Oh, and as a software guy, the self-driving stuff is really fun to watch evolve.

To be fair, European automotive is the most behind out of any.