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Why Tesla stock is vastly overpriced

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Re: Why Tesla stock is vastly overpriced

#61

Post by christophilus »

pdog wrote: post #36

"Don't tell me what you think, tell me what you have in your portfolio." Nassim Nicholas Taleb, Skin in the Game If you're convinced Tesla is vastly overpriced, you should prove it by shorting the stock or buying put options. Betting against Elon Musk has been a terrible move up until now, but if you really think the stock is overvalued, you're probably better off simply not owning it. If you're still concerned about…

He is short, and he makes the case for why the stock can’t repeat it’s past performance. (The law of large numbers, plus some other factors.)

Re: Why Tesla stock is vastly overpriced

#62

Post by abc_lisper »

jeffbee wrote: post #47
abc_lisper wrote: post #14

Earlier quoted context omitted.

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

Apple 12 years ago was only worth $50 billion. At the time, Apple had higher revenues (~40 billion dollars a year) and way higher margins. They made $14 billion gross profits in the year 2008, in 2008 dollars, while Tesla will have gross profits of only $6 billion 2020 dollars this year.

I was comparing it to Nokia then

Re: Why Tesla stock is vastly overpriced

#63

Post by kerng »

ashtonkem wrote: post #15
kerng wrote: post #10

Earlier quoted context omitted.

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.

What about all their "gas" stations? Tesla is the only one with a large recharging infrastructure that is already in place.

Comparisons that try to make Tesla seem like an ordinary car manufacturer are probably quite a bit off.

Re: Why Tesla stock is vastly overpriced

#64

Post by maxerickson »

kerng wrote: post #63
ashtonkem wrote: post #15

Earlier quoted context omitted.

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.

What about all their "gas" stations? Tesla is the only one with a large recharging infrastructure that is already in place. Comparisons that try to make Tesla seem like an ordinary car manufacturer are probably quite a bit off.

How much of an advantage does that really represent?

They are ahead of the field, their chargers are faster, but there's already thousands of other places with relatively high power chargers that can likely be upgraded as demand materializes (at a minimum, the competition is not starting from 0).

Re: Why Tesla stock is vastly overpriced

#65

Post by andrepd »

cronix wrote: post #53
gamblor956 wrote: post #24

Earlier quoted context omitted.

What fundamentally different technologies do you believe they are nowhere near developing? Multiple other manufacturers already make and sell EVs, in some cases outselling Tesla in their home territories. Moreover, while Tesla assembles their own batteries, the underlying battery cells are made for them by Panasonic, which owns the IP to the chemistry. (Tesla's IP relates to the assembly, referring both to the proces…

What are your thoughts on the upcoming battery tech from Tesla they announced during their "battery day" in September? Your comments don't seem to reflect what they've been working on and what's coming. https://www.youtube.com/watch?v=l6T9xIeZTds

Like anything "upcoming" announced by Tesla, to me it's all marketing no substance until proven otherwise.

Re: Why Tesla stock is vastly overpriced

#66

Post by nico42 »

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…

"Skeptics say, it would have to sell every book being sold in the world today to justify its stock price" - Amazon in 1997 [1]. The stock is 50 times higher now.

I have no idea if history will repeat itself, but I find the parallel interesting

[1] https://youtu.be/8SSj7KwBwr8?t=660

Re: Why Tesla stock is vastly overpriced

#67

Post by fakedang »

shyn3 wrote: post #34
fakedang wrote: post #27

Earlier quoted context omitted.

Or maybe you're trying to rationalize your investment thesis after buying into the stock. - Sincerely, a TSLA hodler since summer 2019, when I bought my first car, a Tesla. I'll be holding the stock I have, but I don't think traditional car companies are going away any time soon. On the contrary, I'm thinking of getting a Taycan, a BMW or some other EV car. Tesla isn't overpriced per se, but once the spigot of cheap…

My investment thesis was made prior to my purchase, not after. I make a decision and I stick to it. This is a 5-year investment for me.

I didn't say you made your thesis after buying it. I'm saying you might be overweighing your thesis when you bought into the stock, being the natural hopeful optimists we all are. That being said, there's always the chance that Tesla could be an Apple for cars, which pretty well sums up my opinion about the car itself - great design, but lots of sharks in the water. Of course, Apple has it much easier.

Re: Why Tesla stock is vastly overpriced

#68

Post by statguy »

pdog wrote: post #60
statguy wrote: post #50

Earlier quoted context omitted.

Tesla sells less than 1% of the vehicles that these companies sell combined. Are you seriously suggesting that Tesla production will increase by 100x within a decade? Even if we assume that 100% of the vehicles sold in a decade are electric (highly unlikely), the majority of the increase is likely to come from the other companies. They are not going to sit still and let Tesla devour them.

> Are you seriously suggesting that Tesla production will increase by 100x within a decade? Tesla scaling electric vehicle and battery production by 60% CAGR for a decade doesn't seem too ridiculous when you put it that way. And that doesn't factor in new products. Look at Apple in 2007.

At what CAGR has their vehicle production scaled over the past 5 years?

Re: Why Tesla stock is vastly overpriced

#69

Post by areyousure »

CydeWeys wrote: post #6

Well that's a garbage take. This guy fundamentally doesn't seem to understand what an index is. The S&P 500 doesn't (well, shouldn't) make value judgments about the quality of the companies in it. It's just the 500 largest companies on US exchanges. That's what people who use it want. Really, the big problem here was that it wasn't already included on the S&P 500 years ago, so that all of the gains leading up to this…

> The S&P 500 doesn't (well, shouldn't) make value judgments about the quality of the companies in it. It's just the 500 largest companies on US exchanges. That's what people who use it want.

"Like other indices managed by S&P Dow Jones Indices, but unlike indices such as the Russell 1000 which are strictly rule-based, the components of the S&P 500 index are selected by a committee. When considering the eligibility of a new addition, the committee assesses the company's merit using eight primary criteria: market capitalization, liquidity, domicile, public float, Global Industry Classification Standard and representation of the industries in the economy of the United States, financial viability, length of time publicly traded, and stock exchange."

https://en.wikipedia.org/wiki/S%26P_500_Index#Selection_crit...

Re: Why Tesla stock is vastly overpriced

#70

Post by pkulak »

gamblor956 wrote: post #52
pkulak wrote: post #40

Earlier quoted context omitted.

That new motor that Tesla uses is pretty amazing, and must at least be difficult since almost no other companies use it and instead just deal with reduced range and efficiency.

Tesla's motor isn't what drives the range and efficiency; the battery assembly is their key differentiator. Tesla currently has the industry-leading thermal design; it's ability to cool batteries and prevent thermal-based degradation is far more efficient/effective than anything that competitors have yet been able to put on the market. Supposedly GM's Ultium battery platform will equal or exceed Tesla's batteries, bu…

Range went up about 10% when they switched to the "Raven" motor. That ain't nothin'.
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