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

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

#231

Post by kbutler »

bryanlarsen wrote: post #209
kbutler wrote: post #175

Earlier quoted context omitted.

Right - $300 billion in assets, plus $300 billion in debts means the company is worth: a) $600 billion b) $300 billion c) $0 If you choose anything other than c, I'd love to sell you some businesses.

(B). The company is worth $300 billion to the bondholders, and $0 to shareholders, giving a total value of $300 billion. And that's assuming the company is being liquidated. Most companies with viable businesses are worth a lot more than their assets because the big part of the valuation is assumed future earnings.

So you can create infinite value by borrowing more and more money.

I'd love to create lots of value for you by borrowing money from you. I would even consent to not destroy any of that value through making payments.

The bond is worth $300b to the bondholders, but only because it is expected to be paid back and is secured by the $300b assets. You can prove that by assuming those assets disappeared: how much is the bond (or the company) worth to the bondholders then?

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

#232

Post by FireBeyond »

pbreit wrote: post #142
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…

Here's a better comparison (another company where owners love their cars): Tesla built 35x as many cars as Ferrari and is valued at 3x. Tesla trades at 4x sales, Ferrari at 8x. Having been in business longer is not always advantage and is frequently a disadvantage.

How on earth is a reasonable comparison Company A, whose _most expensive_ car _tops out_ at about $140K, and Company B, whose _least expensive_ car _starts_ at $335K.

These are not remotely comparable companies, regardless of how much "owner love" each may have.

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

#233

Post by Slartie »

sergiosgc wrote: post #204
Slartie wrote: post #155

Earlier quoted context omitted.

At least in Germany, that math doesn't add up. Electricity is - if it's not heavily subsidized, which had been the case for a long time with a lot of EV charging spots over here, although only by accident - at least about 50% of the comparable gas price per mileage. Can be even more than 100% in some corner cases, but I think 50% is a good approximation, assuming you charge mostly at home.

I drive a hybrid and charge at home. My stats on electricity costs, after almost two years, is that my electric kilometers cost me 1/3 of my gasoline kilometers. For reference, it's in Portugal where electricity cost 0.2€/kWh and gasoline 1.5-1.6€/L.

And there's the local difference that makes or breaks this kind of calculation. For Germany these numbers currently are more like 0.3€/kWh and 1.2-1.3€/l.

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

#234

Post by MattRix »

_jal wrote: post #124
SmellyGeekBoy wrote: post #105

Earlier quoted context omitted.

> They did not have any disadvantages besides the high price iPhones couldn't run Flash (which powered all of the interactive content on the internet at the time), couldn't send MMS (which was the way everyone shared photos at the time) or run apps (which was how feature phones added functionality at the time). "Why on Earth would anyone want one of those!?" was a pretty common reaction, yet they still sold like hotc…

> "Why on Earth would anyone want one of those!?" That reaction really only came from makers of competing phones. (RIM execs famously refused to believe the battery life was possible, Balmer threw very unconvincing dismissals.) Everyone else was standing in line to buy one.

It really wasn't that popular initially, at least nowhere near what it is today. There were only 1.5 million sales in 2007, and about 12 million in 2008. For comparison, there were over 210 million sold in 2018.

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

#235

Post by mywittyname »

lhnz wrote: post #60
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…

> 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. In that respect, they remind me of Apple. However, I thought cars and their component parts were considered to be commodities. Are investors now arguing that not having hardware design know-how is going to hurt the big car companies?

It's cheaper this way.

The suppliers are beholden to their master and can live or die on a whim. GM, et al know the cost of manufacturing down to a penny and control supplier margins very tightly. They also collude with other manufactures to suppress prices.

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

#236

Post by riantogo »

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…

It appears extreme only when you think of Tesla as an alternative to one of those car companies. Tesla is as much a car as iPhone is a rotary phone.

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

#237

Post by jbms »

notJim wrote: post #174
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.

This seems really optimistic about the adoption of electric cars. I suspect adoption will be drastically slower than you're imagining, and hybrids as well as gas vehicles will remain relevant for a long time still. Toyota of course has the top-selling hybrid, and introduced a plug-in hybrid version recently. Ford was in the #2 spot and Toyota was again in the #3. Honda takes #5. I think the thesis of these automakers…

Automakers don't like gas/electric hybrids as they are more complex to design and manufacture than either gas or electric vehicles.

Fuel-cell/electric hybrids are a different value proposition and will keep going.

But they'll increasingly drop gas hybrids and jump to full electric, perhaps after the next generation of vehicles.

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

#238

Post by NicoJuicy »

I don't think anyone has a sustainable business model right now for the root cause ( climate change).

Although Tesla seems to be the best option right now. I think the future will be a combination of electric bikes and greatly improved public transportation + reduced cost price.

An electric car is still too resource heavy too make.

I know a lot of people here who won't agree with me. But I'm pretty sure that they don't live in the Netherlands or Belgium ( where a lot of people cycle) or that this alternative is not viable there ( too cold or too wide).

I also didn't say it was a perfect solution for all ( ev. The edge cases I gave here) and that people will easily adjust when they don't have the habit of cycling ( eg. No adjusted roads)

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

#239

Post by SEJeff »

jmelloy wrote: post #136
SEJeff wrote: post #71

Earlier quoted context omitted.

The quality on the 3 is fine. I've heard so many panel gap anecdotes and "fit and finish" problem that I was a bit excessive in my inspection of my Model 3 before I took delivery (November 2018). It was fine. There are no quality problems that I've been able to ascertain. The only real kind of weird thing is the polarized glass on the roof turns a really strange but beautiful color when it gets wet. The car drives li…

It looks so weird and cool when it's wet that I wonder if they did it on purpose. It delights strangers who see it the first time.

Yup! My daughter absolutely adores it

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

#240

Post by tromp »

phkahler wrote: post #122
tdhz77 wrote: post #63

Earlier quoted context omitted.

Car companies have years of office politics that impact their ability to see the future. I think this has clouded their judgment. People are rooting for Tesla. The gas industry has propped up the short sellers and now the ones that have the money are the ones that believe climate change is real and that Tesla is apart of the solution. New technology in batteries, automation, AI, etc is driving Tesla not sales of the…

>> That’s because Tesla is a tech company not a car company The traditional car companies specialy is not cars. Its manufacturing and supply chain management. Tesla does seem to be mastering manufacturing, and being more vertical they dont need as much supply chain handling. They are not particularly advanced in tech from what I've seen. They do have a bunch of young motivated engineers that have a lot to learn and t…

> They are not particularly advanced in tech from what I've seen.

You may not have seen as far as Sandy Monro [1]

[1] https://cleantechnica.com/2018/07/16/munro-model-3-electroni...

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