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Why Tesla stock is vastly overpriced

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Re: Why Tesla stock is vastly overpriced

#11

Post by banjomet »

The only way to justify the valuation of Tesla is to assume that they do something that doesn't depend on individual customer sales, because those aren't ramping up at the right rate. I think they are about to launch an autonomous taxi service.

Here is a good example of Elon Musk talking about how robotaxis are going to push up the price[0]. So far nobody has talked about Tesla operating their own robotaxi service.

[0]: https://www.cnbc.com/2019/07/08/elon-musk-self-driving-robot...

Re: Why Tesla stock is vastly overpriced

#12

Post by xnx »

kerng wrote: post #10
sb057 wrote: post #9

Here's a two-second method to determine whether TSLA is overpriced: currently, their market cap is $659B. The combined caps of Toyota, Volkswagen, Mercedes-Benz, Porsche, BMW, Honda, General Motors, Ford, and Nissan is only $629B. So unless Tesla is worth $30 billion more than all of those companies combined, either those companies are undervalued, or Tesla is massively overvalued. Keep in mind, Tesla sold 367,500 ca…

Tesla is the innovator in this space for 10+ years. Only a few of the companies are all in on electric- and 10 years from now there will be no new old school cars. Some of them have even giant liabilities because of the mess to the environment they have created, which also damaged their brand. Some of them probably wouldn't even exist anymore was it not for government backing/looking away and in some cases even inter…

Tesla car sales will grow, but their stock continuing to grow is not sustainable. Tesla certainly make desirable cars, but I don't see their product being hard to replicate should any other manufacturer make a serious effort. Other manufacturers will make a serious effort when it makes financial sense to.

Re: Why Tesla stock is vastly overpriced

#13

Post by awillen »

I mean yeah, sure, by all reasonable measures, TSLA is grossly overvalued. I absolutely believe it's grossly overvalued.

But... so what? A million people have had this take before this guy and for what? You gonna short the stock? I'm certainly not. So that leaves this as just some mental masturbation on Twitter.

Re: Why Tesla stock is vastly overpriced

#14

Post by abc_lisper »

sb057 wrote: post #9

Here's a two-second method to determine whether TSLA is overpriced: currently, their market cap is $659B. The combined caps of Toyota, Volkswagen, Mercedes-Benz, Porsche, BMW, Honda, General Motors, Ford, and Nissan is only $629B. So unless Tesla is worth $30 billion more than all of those companies combined, either those companies are undervalued, or Tesla is massively overvalued. Keep in mind, Tesla sold 367,500 ca…

You could have said the same thing about Apple 12 years ago.

Re: Why Tesla stock is vastly overpriced

#15

Post by ashtonkem »

kerng wrote: post #10
sb057 wrote: post #9

Here's a two-second method to determine whether TSLA is overpriced: currently, their market cap is $659B. The combined caps of Toyota, Volkswagen, Mercedes-Benz, Porsche, BMW, Honda, General Motors, Ford, and Nissan is only $629B. So unless Tesla is worth $30 billion more than all of those companies combined, either those companies are undervalued, or Tesla is massively overvalued. Keep in mind, Tesla sold 367,500 ca…

Tesla is the innovator in this space for 10+ years. Only a few of the companies are all in on electric- and 10 years from now there will be no new old school cars. Some of them have even giant liabilities because of the mess to the environment they have created, which also damaged their brand. Some of them probably wouldn't even exist anymore was it not for government backing/looking away and in some cases even inter…

The only way for the stock price to be reasonable is if Tesla completely replaces all of the listed car companies combined. That is not realistic, no matter what you think of Tesla’s products.

Re: Why Tesla stock is vastly overpriced

#16

Post by mattnewton »

sb057 wrote: post #9

Here's a two-second method to determine whether TSLA is overpriced: currently, their market cap is $659B. The combined caps of Toyota, Volkswagen, Mercedes-Benz, Porsche, BMW, Honda, General Motors, Ford, and Nissan is only $629B. So unless Tesla is worth $30 billion more than all of those companies combined, either those companies are undervalued, or Tesla is massively overvalued. Keep in mind, Tesla sold 367,500 ca…

I too think tesla is overvalued, but your comparison to ICE companies strikes me as missing that they have fundamentally different technologies those other companies are no where near developing on their own and will likely have to license. Tesla investors are betting that a lot of the ICE based car expertise will be worth just pennies on the dollar if the shift to electric cars happens en masse.

Re: Why Tesla stock is vastly overpriced

#17

Post by wutbrodo »

banjomet wrote: post #11

The only way to justify the valuation of Tesla is to assume that they do something that doesn't depend on individual customer sales, because those aren't ramping up at the right rate. I think they are about to launch an autonomous taxi service. Here is a good example of Elon Musk talking about how robotaxis are going to push up the price[0]. So far nobody has talked about Tesla operating their own robotaxi service. […

Their strategy hasn't been L5 at all, and they can't have invested in it so secretly that even those in the AV space (like me) wouldn't know about it, through talent exchange at the very least. AV is a pretty small world at the moment.

Re: Why Tesla stock is vastly overpriced

#18

Post by tomashertus »

mattnewton wrote: post #16
sb057 wrote: post #9

Here's a two-second method to determine whether TSLA is overpriced: currently, their market cap is $659B. The combined caps of Toyota, Volkswagen, Mercedes-Benz, Porsche, BMW, Honda, General Motors, Ford, and Nissan is only $629B. So unless Tesla is worth $30 billion more than all of those companies combined, either those companies are undervalued, or Tesla is massively overvalued. Keep in mind, Tesla sold 367,500 ca…

I too think tesla is overvalued, but your comparison to ICE companies strikes me as missing that they have fundamentally different technologies those other companies are no where near developing on their own and will likely have to license. Tesla investors are betting that a lot of the ICE based car expertise will be worth just pennies on the dollar if the shift to electric cars happens en masse.

How it can happen without them? To build cars you need infrastructure, factories, and workers and these companies have that already.

There won’t be mass shift without these companies driving the shift, simply because there won’t be enough cars for the demand.

Re: Why Tesla stock is vastly overpriced

#19

Post by zaroth »

sb057 wrote: post #9

Here's a two-second method to determine whether TSLA is overpriced: currently, their market cap is $659B. The combined caps of Toyota, Volkswagen, Mercedes-Benz, Porsche, BMW, Honda, General Motors, Ford, and Nissan is only $629B. So unless Tesla is worth $30 billion more than all of those companies combined, either those companies are undervalued, or Tesla is massively overvalued. Keep in mind, Tesla sold 367,500 ca…

You’re trying to value a company without looking at debt, so you’re missing the big picture.

Total Debt:

  VW.     $237B
  GM.     $192B
  Toyota. $190B
  Ford.   $155B
  Daimler.$108B
  Nissan. $42B
  BMW.    $80B
  Honda.  $42B
So your market cap analysis missed ~$1 trillion of enterprise value in your comparison set.

Simply put, the stock market cap is the total company value minus the debt.

Tesla debt by comparison is $14 billion.

All those companies together being worth only about 3x Tesla is perhaps surprising, but the market is weighting for the possibility that their entire current product lines will be virtually unsellable if not illegal to sell in a decade or so.

Re: Why Tesla stock is vastly overpriced

#20

Post by foepys »

mattnewton wrote: post #16
sb057 wrote: post #9

Here's a two-second method to determine whether TSLA is overpriced: currently, their market cap is $659B. The combined caps of Toyota, Volkswagen, Mercedes-Benz, Porsche, BMW, Honda, General Motors, Ford, and Nissan is only $629B. So unless Tesla is worth $30 billion more than all of those companies combined, either those companies are undervalued, or Tesla is massively overvalued. Keep in mind, Tesla sold 367,500 ca…

I too think tesla is overvalued, but your comparison to ICE companies strikes me as missing that they have fundamentally different technologies those other companies are no where near developing on their own and will likely have to license. Tesla investors are betting that a lot of the ICE based car expertise will be worth just pennies on the dollar if the shift to electric cars happens en masse.

> and will likely have to license

There are already a dozen other electric models on the streets. Why should they have to license from Tesla? The electric engine part of the vehicles is actually not that hard - it's the battery that is complicated and Tesla doesn't even produce the batteries in their cars. That's done by Panasonic.

VW, Toyota, Nissan have supply chain management under control, they don't need to learn it from Tesla.

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