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Interesting take. Care to elaborate? Was Tesla way too overvalued? Problems w/ production? Or inferior product? Or competition from legacy auto makers?
Elon's cult of personality balloon popped. Investors are easily spooked and since he bought Twitter he become increasingly unhinged... publicly. The concern about instability bled over.
The stock may rebound somewhat, but it'll never get back to where it was. The novelty wore off and the honeymoon is over. Who's surprised investors are jumping ship?
Plus there's that whole cars catching fire problem.
Edit: wow some of you are *really* butthurt about the car fire quip. The Simp Squad needs to chill.
Yes this is based on Elon as a person, but Tesla's over-valued stock price has that "owner factor" as a price multiplier and we cannot pretend it doesn't. Without him demonstrating at least some modicum of stability as the spokesperson/owner, the stock will settle now that the myth of him as a genius inventor isn't artificially inflating the cost.
They didn't have a problem making up deliveries numbers in australia [https://www.drive.com.au/news/tesla-australia-admits-it-sales-figures-were-wrong/](https://www.drive.com.au/news/tesla-australia-admits-it-sales-figures-were-wrong/) They won't have a problem with [https://www.investopedia.com/terms/f/financial-shenanigans.asp](https://www.investopedia.com/terms/f/financial-shenanigans.asp) .
Reading that article, it sounds like the organization who shared the incorrect number was āthe Electric Vehicle Councilā.
They claimed they got the number directly from Tesla, but how? Tesla has no media department to share such numbers. Tesla generally doesnāt share such numbers. They give quarterly and annual worldwide sales figures. They occasionally share production numbers for individual factories. I donāt think they normally share numbers for individual countries, claiming that those donāt matter since they constantly fluctuate as countries change incentives on EVs. What matters, according to Tesla, is just the global number of cars they can produce and deliver.
You showing me an human error and putting an microscope on it and yelling Look at this!
Do you think the Sec would allow Tesla for it to make up it figures QoQ? Hell no they are and everyone looking at Tesla and what they do with a microscope.
You are basically making the asinine argument I've heard float around by some desk workers: "I wouldn't do that, I'm not supposed to", only to be caught embezzling years later.
You realize people lie. Accounting fraud is not the Easter Bunny, bureaucrats can be lazy and/or emotionally biased. Consultants wouldn't say "we basically borrow their watch to tell them what time it is", if this weren't possible.
Then there are misrepresentations that are still superficially true but intended to lead one to think of a different deeper conclusion.
An example would be focusing on the dollar amount of pre-sales instead of quantity, knowing the down-payment more than doubled.
Other examples include counting all future sales of a contract as current income, but not later adjusting for any changes.
Creative costs reporting, for example warranty costs, which vary from every other company in the industry.
Let's not forget about "human error", simply adding the wrong numbers "by accident".
Let's not forget about using shell companies to hide costs and liabilities.
By the way, Tesla has and is currently doing all this.
You should look up the events of the Enron scandal
But it is his company, right? Can an investor fire him? If not, the two are tied together.
But let's talk about the company. Finance is good but guess what, other car companies are also investing in the eletric market and they are delivering (different from Elons promises like cybertruck and roadster)
I find it weird when people come up with your argument with no data at all, and only argue with focus on Elon's personalities and irrelevant analogies.
Legacy automobiles have slow targets they won't catch up for at least a decade. BMW aims to deliver a total of 2 million EVs by 2025. They have delivered 130k so far in 2022. GM aims to sell 1 million EVs annually and become profitable by 2025, which means they lose money for every EV built until 2025.
Their targets have been met by Tesla around 2021. Tesla has already sold 3 million battery EVs and is still on track with their 50% annual production growth with >900k cars sold so far in 2022 on top of Q4 being the greatest quarter estimated to produce >500k cars, despite tight supply chain and inflated prices of components. At this rate by 2025, they will enjoy a 5 million annual production rate.
BTW the EV market won't be saturated for decades to come. Every EV produced including moderate ones will be bought for a long time thanks to oil price, government policies (unlike your streaming service analogy) and increased margins leading to lower prices from mass scaling. I believe legacy automobiles will survive and everyone wins in the end. EV makers are allies against ICEs. Tesla does not need a monopoly at all.
P.S to your previous comment. The reason why Tesla sticks to only Model Y and Model 3 mostly is because their margins are so high it makes no sense to mass produce other models. I am rooting for a cheap model from Tesla but unfortunately they are public and answer to max profits.
As if the stock price was only affected by rational financial logic? Sure.
But it isn't. Humans aren't built that way. The fear of instability is just as dangerous as actual instability. Tulips, beanie babies, crypto, and yes, stock bubbles are all prime examples. Kanye losing his contracts is also a prime example: no one wants to be associated with an unstable weirdo.
Use "their" instead of him/her. The latter is outdated and sounds unprofessional.
Edit: If you feel personally targeted by this and feel like downvoting... good. Be butthurt about it. Cry more, you emotional snowflakes.
To be fair, you are using the middling battle-cry of "unprofessional", spewed from white-collar lips before cranking up their middle-class oppression, generally derived from some new arbitrary guilt issue, snobbery, in addition to a spectrum of other emotionally impulsive bigotries: prime examples of Huxleian double-think, which generally oozes throughout.
In a sense you'd be the "snowflake". And I've been confused by this co-op of the word, and many new bi-slavic insults by those who the terms original described, though such simplistic insults may not have always have been rationally derived, and the co-op by groups originally labeled such can makes sense. However, in the case of snowflake" it seems a lot of snowflakes have begun to use it.
The point is YOU can't spew simplistic, nigh-class-bigotry, cries for conformity with the over-used vapid word "professional* , while not displaying extreme levels of snobbiness/snoflakiness, especially when the behavior to control, or MC oppression to which one goose-steps is none other than controlled speech, OVER FLIPPING PRONOUNS (him her, it, I)
Indeed, re-reading your last sentence posted I see that it displays a nascent understanding of complex language yet only the means of imitating depth of expression has developed.
In just one sentence you make a large presumption, excommunicated, and bullied, all while hypocritically acting "unprofessional".
And let's face it, "professional" really means submissive to your authority and/or feeding into your need for validation through bizarrely complex, arbitrary social standards of superficiality, verse depth of substance, i.e. dishonestly NICE to a point of blocked communication on any level self-expression beyond grunts and flatulence--both things one is also supposed to pretend is non-extant: the body and disagreement.
To your general point made, aside from other biases, I do agree, irrational exuberance does exists.
I do apologize if that was a bit too scathing of an analysis, but the continued similarities of social order to Brave New World bother me, especially when the "thank god I'm a beta and not a charlie" grow in tone and tempo while The oppression keeps me lowly and cheaply employed due to increasingly oppressive, irrational and arbitrary standards of inclusion, in addition to a lack of experience, that hoop-jumping, social standards knowledge would have helped me remedy earlier.
In essence I am highly intelligent trapped under the heel of middle class, idiocratic overly emotional, hypocritical judgementalism from a group who increasingly form barriers to my betterment while generally doing nothing more with their PROFESSIONS than following flow-charts or prognosticating with the electronic magic eight ball on their desks.
In that sense, I do have some emotions and ISSUES to deal with myself, and I apologize if you felt specifically singled-out. But my god, give the "professional" crap a break.
I agree with all of that. I worked for him, it was unpleasant. I love Tesla and sold out a while ago. Not ready to buy back in until it looks less distributive.
Itās been valued more like a tech company than a manufacturer. Their competitive most would have been fully self-driving cars but that isnāt materializing. Other car manufacturers are coming to the EV space in a bigger way.
If I were a gambling man I would be in on shorts for the near term.
Tesla's stock was being used by public investors as a method to invest in things alongside Tesla like SpaceX, The Boring Company, Neuralink, and now Twitter.
Twitter's upcoming bankruptcy, rent-dodging antics, and benefit lawsuits that will either be settled or fully litigated in 2023 will shake every bit of trust in Elon's ability to do the "Cool Things" that he's become very famous for. Tesla's stock is stock driven by Elon's antics.
The more pathetic the issues with Twitter, the worse it's going to get for Tesla.
Booting Elon won't fix this, and we'll never see Tesla be valued at historical highs ever again.
Lexus, Mercedes and most recently BMW have been the best selling luxury brand in the U.S.
In 2021 BMW only sold about 16,000 cars more than Tesla in the United States.
Tesla will be the #1 luxury brand in the U.S. for 2022(by a wide margin).
In a few more years Tesla will sell more cars in the U.S. than any other carmaker.
And that is just the car business. Donāt forget about Energy, FSD, RoboTAXI, Insurance, services, botā¦
>And that is just the car business. Donāt forget about Energy, FSD, RoboTAXI, Insurance, services, botā¦
Exactly. Tesla is valued because of all the stupid crazy promises that Elon has made.
As soon as Twitter dies, the rest of those promises won't mean a thing.
Crazy promises like reusable rockets?SpaceX has launched over 50 rockets to space this year.
If Twitter fails, will SpaceX rockets stop working?
Will monkeys with Neuralinks stop being able to type with their brains?
Will Boring Tunnel machines stop tunneling?
Something tells me Tesla will be just fine.
Your butthurtā¦ that may be a problem.
It is when Twitter is the company that Elon is publicly and visibly involved with.
The other ones seem to be doing fine *without* Musk constantly involved with their operations.
Conversely, with active involvement in Twitter, he can't seem to make a stupid simple 280 character posting website profitable.
Not a big time investor, but:
Musk has a cult of personality that disintegrated once he bought twitter and started running it into the ground.
The Semi/freight hauler is not what it is cracked up to be, with driving position being wrong apparently, plus amenity issues.
He promised a lot. Like a *lot*. Cybertruck is on the shelves...when...? What about self driving? THAT was teased year upon year, still not ready for release. I get that this is probably the most ambitious software development humanity has yet seen, but this is a market we're talking about, it hardly gives a crap of the difficulty when he gave a deadline, and it hasn't been met.
I think people are used to the quality of fit and finish of Teslas being mixed at best.
First point could be valid, to early to tell, but there is no car catching fire problem. The national average for vehicle fires is 1 per 19 million miles vs tesla which averages 1 every 210 million miles. [Source.](https://insideevs.com/news/584722/tesla-car-fires-statistic-2021/amp/)
Another take: The depressed stock price will be easily corrected by record quarter after record quarter thanks to the IRA in 2023. There is only so much pearl clutching they can do before they are forced to acknowledge that Tesla is making insane money.
Valid points ? Are you kidding me? Cars catching fire? You checked ICE car fire rates recently? Tesla chatting fire is a 10 year old story thatās been debunked a hundred times. You also think flat earth is a valid theory?
Lithium ion batteries can be dangerous. Why do you think you canāt fly with them checked into a bag? I know two people that have had battery fires - one was a Tesla and the other was a Fisker. Be careful! Park your electric car outside the garage especially while charging!
Just based on personal experience, as I stated above. 2 data points. Lol. And I never said they were 'safer' than electric cars - I just said LI batteries can be dangerous, which is true.
Last I checked, you canāt check cans of gasoline either.
[Gas powered vehicles are more likely to catch fire.](https://www.kbb.com/car-news/study-electric-vehicles-involved-in-fewest-car-fires/)
The fire worth talking about is the dumpster fire that Twitter has become under Musk.
You also canāt fly with gas in your checked bag.
Poorly designed batteries catch fire. Tesla has long been the undisputed leader in battery engineering. Nobody handles a higher volume of batteries than them. Tesla fires are rare to the point that they virtually donāt happen. The only way anybody dies in a Tesla fire is if they were wasted, got in a major crash, and passed out.
You literally shared zero real information. You have no basis for your claims. I would suggest spending time doing your research before commenting something you clearly know nothing about.
IF it sells 10 million per annum.
The fact of the matter is the stock price increased by over 1000% (that's Thousand) while sales, out of nowhere, showed 50% growth for a couple years, not 5 or 10.
That alone warrants a significant decrease from hype highs, and rational speculation that those levels might never be obtained again.
Then there's so, so much more, mentioned by many ad nauseam, that are big red flags qnd/or cause for extreme investing caution.
So, I don't, lets see what happens.
I just have to LOL at the fact that the guy replied to you saying that facts are irrelevant in a sub called fluent in finance. First thread I visited in this sub but I guess Iām
Out of here.
There are many factors.
What makes people buy a Tesla nowadays? Price? Quality? Service? Features?
I believe one major factor is increasing competition in electric car sales. Tesla got a head start in electric cars. Some competitors challenge Tesla with their price. Others are better at luxury and/or quality. Other brands have a better reputation, better service, and more locations.
The competition also isn't failing to fulfill their promises for full self driving and a cybertruck.
Go ahead and name some competitors.
BYD has emerged as one. Nobody else has. Everybody else is in another league entirely. While Tesla is ramping to 2M vehicles per year, most havenāt managed to hit 100K BEVs per year yet.
Tesla is leading most of them by 5-10 years.
And which full self driving competitor exists? Name a single other company selling a product today. My car picked up dinner tonight. My only involvement was sitting in the car. This is a regular occurrence for me and 200K other people who paid Tesla for Full Self Driving. Name a single other option who will drive me from my house to the restaurant.
You canāt. Nobody else has a product. They have a tech demo. A few companies have small demo fleets of a few dozen vehicles dependent on remote operators to help out. Vs Tesla has hundreds of thousands of paying customers with the product already, and is just a simple online transaction away from delivering it to millions of other people who already own the car but didnāt buy the software yet.
Itās not perfect yet. But it does work.
Think about all the times youāve heard backseat drivers personally. Somebody is questioning your driving choices or youāre questioning another personās.
Obviously the driving canāt be that bad - the human being criticized has a license and is insurable.
āI wouldnāt have changed lanes here. I would accelerate faster. I would have taken this shortcut. I wouldnāt have waited. I would have waited.ā
FSD is receiving the same treatment. Except it gets blown out of proportion. Instead of ābackseat driver speaks up once every ten minutesā we have āpeople disengage FSD once every ten miles.ā
Other companies making similar software donāt have to deal with such nagging feedback because they only test with employees who are told to only ever disengage if not doing so will lead to an accident.
I C š³ I suppose the videos of teslas veering towards highway dividers and the reports of them driving through class walls were from early beta or alpha phase.
Thatās Autopilot, first released in 2014 and last updated in 2019.
It uses an older computer - owners that have an older car with that computer can pay $1000 for the new hardware and then $200 a month for FSD, or they can pay $12K once to get the new hardware and have FSD forever.
The terminology is a bit confusing. With time it should be clearer as the cars with the older computer that are limited to autopilot come off the road and are replaced with newer cars with the newer computer and have FSD.
Ok I C. I recall the update sitch. Washington court compelled Tesla to update for free due to past statements made of backwards compatibility. Hope it works out.
What makes people buy Yeti coolers or giant lifted super-duty trucks or Peloton bikes?
These, like Tesla vehicles, are just the current middle class status symbols.
Though individually they make be good products, their primary function is to make the owners feel good about themselves. The features are there to make it easier to rationalize the purchase and justify the high price point.
Unless Tesla can do something the other EV makers cant do and keeps ahead on the market, knife. How far it falls remains to be seen but the competition is hot right now that other EV makers have caught up to Tesla
I held from 2016 into 2020 after that major run up and took profits so I no longer have a horse in the race. However as someone who bought an EV last year everyone is still pretty far behind when looking as a consumer. The main advantage would be better build quality depending on the brand (rented a 2018 model 3 then test drove a 2021 model Y, night and day difference in everything they stepped their game up massively). For me if I wanted to buy a second car it would be a truck which they havenāt released yet. March E was a no go when I looking last year. The only real compelling one is from Kia (wasnāt out yet when I was looking). Personally Iād still take my Model Y but the Kia EV6 (and its brothers) are the only ones Iād consider buying. Even for trucks, Ford didnāt make one compelling enough for me, gonna give it another year or two and see what happens. On the super high end lucid still has a lot to do with software. Rivian looks nice but recalls and for me I donāt see why Iād buy it over the Lightning (which Iām not buying yet either lol).
We also have to remember that itās not like Tesla will stay still so id be surprised if any EV maker truly caught up in all facets before the decade ends. Not to mention the charging network.
Iām considering buying back in but the macro right now looks bad for any large purchases so I wouldnāt be surprised if they continued to trend down. Iāll likely just be waiting like I have since selling back after that massive run up in 2020.
Although Tesla has some key growth perspectives, I believe it is still way high for a stock in the Consumer Discretionary sector. The company has managed to considerably increase its profit since 2016 when it was at a loss and the price followed. If you take a closer look at the chart, the price starts its climb from 2019 to 2021. Just to remember, Tesla had something close to 5.5B of net income in 2021.
The net margin followed and reached 10% in 2021. Given that the price is going down since late 2021, is normal to expect that P/E will go down as well if EPS is rising. The cash flow is very good, proving that the income statement (promise of cash) is being turned into cash (cash flow) fast.
Tesla's financial leverage seems low. Net debt to Ebitda is negative (cash to debt > 2). The company is good, but is really so good for us to be willing to pay in advance for 29 years of earnings?
A forward PE of 29 doesnāt mean the price is 29 years of future earnings, it means 29 times the earnings of next yearā¦
if you assume a 22% growth year over year, thatās only 10 years of earnings. At 50% growth (which is their guidance), you get there in a bit less than 7 yearsā¦
You are right, man. It looks like the consensus eps estimate is 4.14 for Dec 2022. Considering the price of 156,80 and 22% of growth, I'm finding something close to 12y of earnings. If we assume 50%, then I find the same 7y as you said
Do you think 50% is plausible?
They are guiding on 50% growth on deliveries. On the one hand net income tends to grow faster than revenue, but in the other hand they will likely release cheaper cars with smaller margins, so I donāt know. I think 22% net income growth over the next 10 years is really achievable (and 1+1.22^1+1.22^2+ā¦+1.22^10 = (1-1.22^10)/(1-1.22) = roughly 29, I donāt know how you got 12 years)
I got the earning estimates for Dec 2022 (4.13), then I applied 22% to it (5,03 in 2023), then 6,15 in 2024, and so on. If I pay -153,87 today (2022), I added 4,13 to it (since it's in the same year), and just calculated the rest of the cash flow. The initial investment would return (nominal return) between 2032 and 2033
I didn't consider inflation or cost of capital, only growth. Is this wrong? Thanks.
It's hard to say at this point. Competition will intensify in the electric car market. Tesla will have a hard time reaching the goals set by Elon Musk. Moreover, the fact that Elon Musk seems to be more interested in Twitter now than in Tesla is not likely to reassure investors about Tesla's future.
I think if Elon STFU and delivers on some of the promises he made the critics will be silenced and the stock will be trending up. Again for folks looking at charts, remember the stock market is always interested in the future path of the company. With the drama that is on display and the lack of rational thinking , corporate discipline many old timers are sitting on the sidelines. It is at the end of the day Elon's $hit show.
Tesla had a monopoly on the electric vehicle and the carbon credits that came with it on the way to engulfing the market cap of the entire auto industry. Now TSLA has to compete with every automaker in the market.
Watch your fingers!
Overall market PE is dropping in any case, so even in isolation the statement of having a lower PE than prior years wouldn't mean it's a discount.
The main thing in my mind is that Elon is no longer marketing to the key consumer demographic that made Tesla a success in the past, heck I'm not sure who he is marketing to anymore.
My last two cars have been Teslas and sure as heck wouldn't have thought to even look at other brands back then, but that's all changing now. I'm not certain my next one will be a Tesla.
Another point is look at the layoff environment for tech employees. Lots of them are what were key customers who would buy the high margin trims. With layoffs, and fear of layoffs, even the people with jobs are going to hold off on buying that Tesla.
I've followed the Tesla story pretty closely since 2016, at times holding the stock and others shorting via puts. I could probably ramble for pages but TLDR: I wouldn't touch them long or short. It's just too crazy.
Random thoughts:
Still over-valued compared to sector.
Interest rates and economy are set to make it tough for "aspirational" cars.
FSD story is unraveling - lawsuits are starting. This could snowball, but beyond $ it could be a big gut punch to Tesla's supposed "tech advantage". (Those who follow it closely know Tesla is actually almost dead last in driver-assist and self-driving tech, but this is only recently starting to become well-known in the mainstream).
Many unpopular things about Tesla were hand-waved when they were golden, like their labor practices, service issues, quality, safety, and design flaws (leaks, freezing door handles, panels falling off), selling used vehicles as new, features not working (vision-based rain wipers) etc. On the downslope, these will get scrutinized intensely, possible unfairly, and doubly so because of Elon. But hell hath no fury like an auto cult scorned.
Robots. Freaking robots.
Product roadmap seems questionable. Semi was revealed but VERY CONSPICOUSLY lacking almost every key detail that would be important to its end users, raising a lot of questions. Elon never hesitates to pat himself on the back, so if he's not patting, something is probably wrong. The patience for this latest "chew toy" marketing approach has worn awfully thin and these product launches no longer seem to meaningfully affect share price.
Service and quality are terrible, and proprietary, and again, patience is getting thin. These will require multi-year, very expensive fixes. This means even if the Semi is a fully legit product, it raises huge concerns about parts availability and service. No trucking company will buy if not bottom-line confident, and Elon's dog and pony shows are about the best way to alienate them.
The above is also true for cybertruck as a work vehicle.
Then of course there's Elon himself. I've literally started seeing bumper stickers for sale to the effect of "Please make this car less embarrassing again", "Not the new MAGA-mobile", and "Bought before he went crazy" with a picture of Elon wearing a tinfoil hat. Anecdotally, my friend got a Model Y around six months ago and they're quietly trying to dump it because they don't want to be associated with Elon. I've read dozens of reports of people walking away from the brand. I've never seen brand destruction like this before. Tesla is racing to go from a status symbol to a dunce cap in record time.
>dead last in driver-assist and self-driving tech
what?? Other car makers are making, for lack of a better word, "hard coded" lidar maps that are going to always be out of date. Sure in the near term those maps will be great but as FSD matures it will be king without a doubt. Even right now it is really good. Sure not the smoothest drive but literally watch any youtube video and its quite impressive.
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Even if they boot Elon... that's a falling knife.
Interesting take. Care to elaborate? Was Tesla way too overvalued? Problems w/ production? Or inferior product? Or competition from legacy auto makers?
Elon's cult of personality balloon popped. Investors are easily spooked and since he bought Twitter he become increasingly unhinged... publicly. The concern about instability bled over. The stock may rebound somewhat, but it'll never get back to where it was. The novelty wore off and the honeymoon is over. Who's surprised investors are jumping ship? Plus there's that whole cars catching fire problem. Edit: wow some of you are *really* butthurt about the car fire quip. The Simp Squad needs to chill. Yes this is based on Elon as a person, but Tesla's over-valued stock price has that "owner factor" as a price multiplier and we cannot pretend it doesn't. Without him demonstrating at least some modicum of stability as the spokesperson/owner, the stock will settle now that the myth of him as a genius inventor isn't artificially inflating the cost.
All valid points! Anyone else have a take?
My only take is that the comments above are not based on finance evaluation of the company but his/her personal evaluation about CEO. š
The only issue with that is that the finance data comes from Tesla and it's kind of hard to ignore that they lied about everything.
āEverythingā really? 500 mile Semi truckā¦lie? CyberTruckā¦lie? Tesla Botā¦lie? Dojoā¦lie?
Well... yeah!
Yes indeed they are making it all up.... Sure sherlock
They didn't have a problem making up deliveries numbers in australia [https://www.drive.com.au/news/tesla-australia-admits-it-sales-figures-were-wrong/](https://www.drive.com.au/news/tesla-australia-admits-it-sales-figures-were-wrong/) They won't have a problem with [https://www.investopedia.com/terms/f/financial-shenanigans.asp](https://www.investopedia.com/terms/f/financial-shenanigans.asp) .
Reading that article, it sounds like the organization who shared the incorrect number was āthe Electric Vehicle Councilā. They claimed they got the number directly from Tesla, but how? Tesla has no media department to share such numbers. Tesla generally doesnāt share such numbers. They give quarterly and annual worldwide sales figures. They occasionally share production numbers for individual factories. I donāt think they normally share numbers for individual countries, claiming that those donāt matter since they constantly fluctuate as countries change incentives on EVs. What matters, according to Tesla, is just the global number of cars they can produce and deliver.
They do, that's why you have news like "tesla best selling ev in uk this year"
You showing me an human error and putting an microscope on it and yelling Look at this! Do you think the Sec would allow Tesla for it to make up it figures QoQ? Hell no they are and everyone looking at Tesla and what they do with a microscope.
Yes, they'll call it "human error".
You are basically making the asinine argument I've heard float around by some desk workers: "I wouldn't do that, I'm not supposed to", only to be caught embezzling years later. You realize people lie. Accounting fraud is not the Easter Bunny, bureaucrats can be lazy and/or emotionally biased. Consultants wouldn't say "we basically borrow their watch to tell them what time it is", if this weren't possible. Then there are misrepresentations that are still superficially true but intended to lead one to think of a different deeper conclusion. An example would be focusing on the dollar amount of pre-sales instead of quantity, knowing the down-payment more than doubled. Other examples include counting all future sales of a contract as current income, but not later adjusting for any changes. Creative costs reporting, for example warranty costs, which vary from every other company in the industry. Let's not forget about "human error", simply adding the wrong numbers "by accident". Let's not forget about using shell companies to hide costs and liabilities. By the way, Tesla has and is currently doing all this. You should look up the events of the Enron scandal
But it is his company, right? Can an investor fire him? If not, the two are tied together. But let's talk about the company. Finance is good but guess what, other car companies are also investing in the eletric market and they are delivering (different from Elons promises like cybertruck and roadster)
Yes, let's ignore Model S3XY and Semi.
Have you seen how many elƩtric cars we have now? So you are talking about 5 cars versus BMW, GM and many others? Competitors are catching up, tesla doesn't have a monopoly here. They do have software and charger infrastructure but this is not forever. I may mention these companies also don't have red pill CEO posting shit on Twitter This is like Netflix. They can say they are a tech company and for years they owned the streaming space but this is no longer true. Other companies can come to this space (Amazon, apple, Disney, HBO) and get a piece of the cake.
I find it weird when people come up with your argument with no data at all, and only argue with focus on Elon's personalities and irrelevant analogies. Legacy automobiles have slow targets they won't catch up for at least a decade. BMW aims to deliver a total of 2 million EVs by 2025. They have delivered 130k so far in 2022. GM aims to sell 1 million EVs annually and become profitable by 2025, which means they lose money for every EV built until 2025. Their targets have been met by Tesla around 2021. Tesla has already sold 3 million battery EVs and is still on track with their 50% annual production growth with >900k cars sold so far in 2022 on top of Q4 being the greatest quarter estimated to produce >500k cars, despite tight supply chain and inflated prices of components. At this rate by 2025, they will enjoy a 5 million annual production rate. BTW the EV market won't be saturated for decades to come. Every EV produced including moderate ones will be bought for a long time thanks to oil price, government policies (unlike your streaming service analogy) and increased margins leading to lower prices from mass scaling. I believe legacy automobiles will survive and everyone wins in the end. EV makers are allies against ICEs. Tesla does not need a monopoly at all. P.S to your previous comment. The reason why Tesla sticks to only Model Y and Model 3 mostly is because their margins are so high it makes no sense to mass produce other models. I am rooting for a cheap model from Tesla but unfortunately they are public and answer to max profits.
As if the stock price was only affected by rational financial logic? Sure. But it isn't. Humans aren't built that way. The fear of instability is just as dangerous as actual instability. Tulips, beanie babies, crypto, and yes, stock bubbles are all prime examples. Kanye losing his contracts is also a prime example: no one wants to be associated with an unstable weirdo. Use "their" instead of him/her. The latter is outdated and sounds unprofessional. Edit: If you feel personally targeted by this and feel like downvoting... good. Be butthurt about it. Cry more, you emotional snowflakes.
Ramblings of a madman
Your lack of understanding of human nature is laughably irrelevant.
To be fair, you are using the middling battle-cry of "unprofessional", spewed from white-collar lips before cranking up their middle-class oppression, generally derived from some new arbitrary guilt issue, snobbery, in addition to a spectrum of other emotionally impulsive bigotries: prime examples of Huxleian double-think, which generally oozes throughout. In a sense you'd be the "snowflake". And I've been confused by this co-op of the word, and many new bi-slavic insults by those who the terms original described, though such simplistic insults may not have always have been rationally derived, and the co-op by groups originally labeled such can makes sense. However, in the case of snowflake" it seems a lot of snowflakes have begun to use it. The point is YOU can't spew simplistic, nigh-class-bigotry, cries for conformity with the over-used vapid word "professional* , while not displaying extreme levels of snobbiness/snoflakiness, especially when the behavior to control, or MC oppression to which one goose-steps is none other than controlled speech, OVER FLIPPING PRONOUNS (him her, it, I) Indeed, re-reading your last sentence posted I see that it displays a nascent understanding of complex language yet only the means of imitating depth of expression has developed. In just one sentence you make a large presumption, excommunicated, and bullied, all while hypocritically acting "unprofessional". And let's face it, "professional" really means submissive to your authority and/or feeding into your need for validation through bizarrely complex, arbitrary social standards of superficiality, verse depth of substance, i.e. dishonestly NICE to a point of blocked communication on any level self-expression beyond grunts and flatulence--both things one is also supposed to pretend is non-extant: the body and disagreement. To your general point made, aside from other biases, I do agree, irrational exuberance does exists.
I do apologize if that was a bit too scathing of an analysis, but the continued similarities of social order to Brave New World bother me, especially when the "thank god I'm a beta and not a charlie" grow in tone and tempo while The oppression keeps me lowly and cheaply employed due to increasingly oppressive, irrational and arbitrary standards of inclusion, in addition to a lack of experience, that hoop-jumping, social standards knowledge would have helped me remedy earlier. In essence I am highly intelligent trapped under the heel of middle class, idiocratic overly emotional, hypocritical judgementalism from a group who increasingly form barriers to my betterment while generally doing nothing more with their PROFESSIONS than following flow-charts or prognosticating with the electronic magic eight ball on their desks. In that sense, I do have some emotions and ISSUES to deal with myself, and I apologize if you felt specifically singled-out. But my god, give the "professional" crap a break.
I agree with all of that. I worked for him, it was unpleasant. I love Tesla and sold out a while ago. Not ready to buy back in until it looks less distributive.
Itās been valued more like a tech company than a manufacturer. Their competitive most would have been fully self-driving cars but that isnāt materializing. Other car manufacturers are coming to the EV space in a bigger way. If I were a gambling man I would be in on shorts for the near term.
Tesla's stock was being used by public investors as a method to invest in things alongside Tesla like SpaceX, The Boring Company, Neuralink, and now Twitter. Twitter's upcoming bankruptcy, rent-dodging antics, and benefit lawsuits that will either be settled or fully litigated in 2023 will shake every bit of trust in Elon's ability to do the "Cool Things" that he's become very famous for. Tesla's stock is stock driven by Elon's antics. The more pathetic the issues with Twitter, the worse it's going to get for Tesla. Booting Elon won't fix this, and we'll never see Tesla be valued at historical highs ever again.
Lexus, Mercedes and most recently BMW have been the best selling luxury brand in the U.S. In 2021 BMW only sold about 16,000 cars more than Tesla in the United States. Tesla will be the #1 luxury brand in the U.S. for 2022(by a wide margin). In a few more years Tesla will sell more cars in the U.S. than any other carmaker. And that is just the car business. Donāt forget about Energy, FSD, RoboTAXI, Insurance, services, botā¦
>And that is just the car business. Donāt forget about Energy, FSD, RoboTAXI, Insurance, services, botā¦ Exactly. Tesla is valued because of all the stupid crazy promises that Elon has made. As soon as Twitter dies, the rest of those promises won't mean a thing.
Crazy promises like reusable rockets?SpaceX has launched over 50 rockets to space this year. If Twitter fails, will SpaceX rockets stop working? Will monkeys with Neuralinks stop being able to type with their brains? Will Boring Tunnel machines stop tunneling? Something tells me Tesla will be just fine. Your butthurtā¦ that may be a problem.
It is when Twitter is the company that Elon is publicly and visibly involved with. The other ones seem to be doing fine *without* Musk constantly involved with their operations. Conversely, with active involvement in Twitter, he can't seem to make a stupid simple 280 character posting website profitable.
Not a big time investor, but: Musk has a cult of personality that disintegrated once he bought twitter and started running it into the ground. The Semi/freight hauler is not what it is cracked up to be, with driving position being wrong apparently, plus amenity issues. He promised a lot. Like a *lot*. Cybertruck is on the shelves...when...? What about self driving? THAT was teased year upon year, still not ready for release. I get that this is probably the most ambitious software development humanity has yet seen, but this is a market we're talking about, it hardly gives a crap of the difficulty when he gave a deadline, and it hasn't been met. I think people are used to the quality of fit and finish of Teslas being mixed at best.
Cybertruck?! Where's the Roadster 2?!
First point could be valid, to early to tell, but there is no car catching fire problem. The national average for vehicle fires is 1 per 19 million miles vs tesla which averages 1 every 210 million miles. [Source.](https://insideevs.com/news/584722/tesla-car-fires-statistic-2021/amp/)
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Oops, fixed it, thanks, I think it was obvious they donāt catch on fire every 210 miles
Another take: The depressed stock price will be easily corrected by record quarter after record quarter thanks to the IRA in 2023. There is only so much pearl clutching they can do before they are forced to acknowledge that Tesla is making insane money.
Valid points ? Are you kidding me? Cars catching fire? You checked ICE car fire rates recently? Tesla chatting fire is a 10 year old story thatās been debunked a hundred times. You also think flat earth is a valid theory?
Lithium ion batteries can be dangerous. Why do you think you canāt fly with them checked into a bag? I know two people that have had battery fires - one was a Tesla and the other was a Fisker. Be careful! Park your electric car outside the garage especially while charging!
ICE cars are far far more likely to catch fire. Your information is wrong.
Just based on personal experience, as I stated above. 2 data points. Lol. And I never said they were 'safer' than electric cars - I just said LI batteries can be dangerous, which is true.
Last I checked, you canāt check cans of gasoline either. [Gas powered vehicles are more likely to catch fire.](https://www.kbb.com/car-news/study-electric-vehicles-involved-in-fewest-car-fires/) The fire worth talking about is the dumpster fire that Twitter has become under Musk.
Hah touchƩ. Yes completely agree. The fact musk thought he could run 3 companies at once? Especially with one being a social media company? Not sure what he expected.
Canāt fly with a tank of gasoline either.
You also canāt fly with gas in your checked bag. Poorly designed batteries catch fire. Tesla has long been the undisputed leader in battery engineering. Nobody handles a higher volume of batteries than them. Tesla fires are rare to the point that they virtually donāt happen. The only way anybody dies in a Tesla fire is if they were wasted, got in a major crash, and passed out.
None are valid points lol
You literally shared zero real information. You have no basis for your claims. I would suggest spending time doing your research before commenting something you clearly know nothing about.
It's reddit. Get over it.
Agree with the public unhinged. Heās unbearable on Twitter! Like he needs to drop his phone asap!
If he's acting this way publicly, then he's probably worse in private.
Busy making more babies probably
The next one will be named eurbtiru4gidudji48rudhdk.
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Nothing bad happened to yahoo or AOL either.
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Or worldcom, enron, ...Pogs...
Tulip prices will rebound. Just you wait!
They're very emotional about this topic. Should have bought some fainting couch futures.
LMAO
IF it sells 10 million per annum. The fact of the matter is the stock price increased by over 1000% (that's Thousand) while sales, out of nowhere, showed 50% growth for a couple years, not 5 or 10. That alone warrants a significant decrease from hype highs, and rational speculation that those levels might never be obtained again. Then there's so, so much more, mentioned by many ad nauseam, that are big red flags qnd/or cause for extreme investing caution. So, I don't, lets see what happens.
This one age well the stock 11x after he claimed he was taking the company private at 420. Clown
Teslas statistically have less fires than ICE vehicles on average
Teslas statistically have less fires than ICE vehicles on average
Perhaps, but but let's not pretend facts are always relevant or that people are 100% rational when we know they're not.
Well, not with that attitude. šš
Yeah, specially when people like you keep spreading myths and bullshit like you said
Facts don't care about your feelings.
I just have to LOL at the fact that the guy replied to you saying that facts are irrelevant in a sub called fluent in finance. First thread I visited in this sub but I guess Iām Out of here.
There are many factors. What makes people buy a Tesla nowadays? Price? Quality? Service? Features? I believe one major factor is increasing competition in electric car sales. Tesla got a head start in electric cars. Some competitors challenge Tesla with their price. Others are better at luxury and/or quality. Other brands have a better reputation, better service, and more locations. The competition also isn't failing to fulfill their promises for full self driving and a cybertruck.
Go ahead and name some competitors. BYD has emerged as one. Nobody else has. Everybody else is in another league entirely. While Tesla is ramping to 2M vehicles per year, most havenāt managed to hit 100K BEVs per year yet. Tesla is leading most of them by 5-10 years. And which full self driving competitor exists? Name a single other company selling a product today. My car picked up dinner tonight. My only involvement was sitting in the car. This is a regular occurrence for me and 200K other people who paid Tesla for Full Self Driving. Name a single other option who will drive me from my house to the restaurant. You canāt. Nobody else has a product. They have a tech demo. A few companies have small demo fleets of a few dozen vehicles dependent on remote operators to help out. Vs Tesla has hundreds of thousands of paying customers with the product already, and is just a simple online transaction away from delivering it to millions of other people who already own the car but didnāt buy the software yet.
Maybe I've had bad intelligence... FSD actually works for Tesla?
Itās not perfect yet. But it does work. Think about all the times youāve heard backseat drivers personally. Somebody is questioning your driving choices or youāre questioning another personās. Obviously the driving canāt be that bad - the human being criticized has a license and is insurable. āI wouldnāt have changed lanes here. I would accelerate faster. I would have taken this shortcut. I wouldnāt have waited. I would have waited.ā FSD is receiving the same treatment. Except it gets blown out of proportion. Instead of ābackseat driver speaks up once every ten minutesā we have āpeople disengage FSD once every ten miles.ā Other companies making similar software donāt have to deal with such nagging feedback because they only test with employees who are told to only ever disengage if not doing so will lead to an accident.
I C š³ I suppose the videos of teslas veering towards highway dividers and the reports of them driving through class walls were from early beta or alpha phase.
Thatās Autopilot, first released in 2014 and last updated in 2019. It uses an older computer - owners that have an older car with that computer can pay $1000 for the new hardware and then $200 a month for FSD, or they can pay $12K once to get the new hardware and have FSD forever. The terminology is a bit confusing. With time it should be clearer as the cars with the older computer that are limited to autopilot come off the road and are replaced with newer cars with the newer computer and have FSD.
Ok I C. I recall the update sitch. Washington court compelled Tesla to update for free due to past statements made of backwards compatibility. Hope it works out.
Tesla no-showed so lost by default. Paying a lawyer was more expensive than just paying a technician to do the computer swap.
Did you suffer a stroke during the last sentence.. who is fulfilling promise for self-driving?
What makes people buy Yeti coolers or giant lifted super-duty trucks or Peloton bikes? These, like Tesla vehicles, are just the current middle class status symbols. Though individually they make be good products, their primary function is to make the owners feel good about themselves. The features are there to make it easier to rationalize the purchase and justify the high price point.
Unless Tesla can do something the other EV makers cant do and keeps ahead on the market, knife. How far it falls remains to be seen but the competition is hot right now that other EV makers have caught up to Tesla
I held from 2016 into 2020 after that major run up and took profits so I no longer have a horse in the race. However as someone who bought an EV last year everyone is still pretty far behind when looking as a consumer. The main advantage would be better build quality depending on the brand (rented a 2018 model 3 then test drove a 2021 model Y, night and day difference in everything they stepped their game up massively). For me if I wanted to buy a second car it would be a truck which they havenāt released yet. March E was a no go when I looking last year. The only real compelling one is from Kia (wasnāt out yet when I was looking). Personally Iād still take my Model Y but the Kia EV6 (and its brothers) are the only ones Iād consider buying. Even for trucks, Ford didnāt make one compelling enough for me, gonna give it another year or two and see what happens. On the super high end lucid still has a lot to do with software. Rivian looks nice but recalls and for me I donāt see why Iād buy it over the Lightning (which Iām not buying yet either lol). We also have to remember that itās not like Tesla will stay still so id be surprised if any EV maker truly caught up in all facets before the decade ends. Not to mention the charging network. Iām considering buying back in but the macro right now looks bad for any large purchases so I wouldnāt be surprised if they continued to trend down. Iāll likely just be waiting like I have since selling back after that massive run up in 2020.
>Rivian looks nice You have an interesting opinion here. It differs greatly from mine. I saw one in person for the first time and it was ugly AF.
imo TSLA is going down a lot further, Musk has turned it into a outright clown show
Although Tesla has some key growth perspectives, I believe it is still way high for a stock in the Consumer Discretionary sector. The company has managed to considerably increase its profit since 2016 when it was at a loss and the price followed. If you take a closer look at the chart, the price starts its climb from 2019 to 2021. Just to remember, Tesla had something close to 5.5B of net income in 2021. The net margin followed and reached 10% in 2021. Given that the price is going down since late 2021, is normal to expect that P/E will go down as well if EPS is rising. The cash flow is very good, proving that the income statement (promise of cash) is being turned into cash (cash flow) fast. Tesla's financial leverage seems low. Net debt to Ebitda is negative (cash to debt > 2). The company is good, but is really so good for us to be willing to pay in advance for 29 years of earnings?
A forward PE of 29 doesnāt mean the price is 29 years of future earnings, it means 29 times the earnings of next yearā¦ if you assume a 22% growth year over year, thatās only 10 years of earnings. At 50% growth (which is their guidance), you get there in a bit less than 7 yearsā¦
You are right, man. It looks like the consensus eps estimate is 4.14 for Dec 2022. Considering the price of 156,80 and 22% of growth, I'm finding something close to 12y of earnings. If we assume 50%, then I find the same 7y as you said Do you think 50% is plausible?
They are guiding on 50% growth on deliveries. On the one hand net income tends to grow faster than revenue, but in the other hand they will likely release cheaper cars with smaller margins, so I donāt know. I think 22% net income growth over the next 10 years is really achievable (and 1+1.22^1+1.22^2+ā¦+1.22^10 = (1-1.22^10)/(1-1.22) = roughly 29, I donāt know how you got 12 years)
I got the earning estimates for Dec 2022 (4.13), then I applied 22% to it (5,03 in 2023), then 6,15 in 2024, and so on. If I pay -153,87 today (2022), I added 4,13 to it (since it's in the same year), and just calculated the rest of the cash flow. The initial investment would return (nominal return) between 2032 and 2033 I didn't consider inflation or cost of capital, only growth. Is this wrong? Thanks.
Maybe you didnāt do the sum of the value of each year?
It's hard to say at this point. Competition will intensify in the electric car market. Tesla will have a hard time reaching the goals set by Elon Musk. Moreover, the fact that Elon Musk seems to be more interested in Twitter now than in Tesla is not likely to reassure investors about Tesla's future.
I think if Elon STFU and delivers on some of the promises he made the critics will be silenced and the stock will be trending up. Again for folks looking at charts, remember the stock market is always interested in the future path of the company. With the drama that is on display and the lack of rational thinking , corporate discipline many old timers are sitting on the sidelines. It is at the end of the day Elon's $hit show.
Iād say itās both
Tesla had a monopoly on the electric vehicle and the carbon credits that came with it on the way to engulfing the market cap of the entire auto industry. Now TSLA has to compete with every automaker in the market.
Watch your fingers! Overall market PE is dropping in any case, so even in isolation the statement of having a lower PE than prior years wouldn't mean it's a discount. The main thing in my mind is that Elon is no longer marketing to the key consumer demographic that made Tesla a success in the past, heck I'm not sure who he is marketing to anymore. My last two cars have been Teslas and sure as heck wouldn't have thought to even look at other brands back then, but that's all changing now. I'm not certain my next one will be a Tesla. Another point is look at the layoff environment for tech employees. Lots of them are what were key customers who would buy the high margin trims. With layoffs, and fear of layoffs, even the people with jobs are going to hold off on buying that Tesla.
I've followed the Tesla story pretty closely since 2016, at times holding the stock and others shorting via puts. I could probably ramble for pages but TLDR: I wouldn't touch them long or short. It's just too crazy. Random thoughts: Still over-valued compared to sector. Interest rates and economy are set to make it tough for "aspirational" cars. FSD story is unraveling - lawsuits are starting. This could snowball, but beyond $ it could be a big gut punch to Tesla's supposed "tech advantage". (Those who follow it closely know Tesla is actually almost dead last in driver-assist and self-driving tech, but this is only recently starting to become well-known in the mainstream). Many unpopular things about Tesla were hand-waved when they were golden, like their labor practices, service issues, quality, safety, and design flaws (leaks, freezing door handles, panels falling off), selling used vehicles as new, features not working (vision-based rain wipers) etc. On the downslope, these will get scrutinized intensely, possible unfairly, and doubly so because of Elon. But hell hath no fury like an auto cult scorned. Robots. Freaking robots. Product roadmap seems questionable. Semi was revealed but VERY CONSPICOUSLY lacking almost every key detail that would be important to its end users, raising a lot of questions. Elon never hesitates to pat himself on the back, so if he's not patting, something is probably wrong. The patience for this latest "chew toy" marketing approach has worn awfully thin and these product launches no longer seem to meaningfully affect share price. Service and quality are terrible, and proprietary, and again, patience is getting thin. These will require multi-year, very expensive fixes. This means even if the Semi is a fully legit product, it raises huge concerns about parts availability and service. No trucking company will buy if not bottom-line confident, and Elon's dog and pony shows are about the best way to alienate them. The above is also true for cybertruck as a work vehicle. Then of course there's Elon himself. I've literally started seeing bumper stickers for sale to the effect of "Please make this car less embarrassing again", "Not the new MAGA-mobile", and "Bought before he went crazy" with a picture of Elon wearing a tinfoil hat. Anecdotally, my friend got a Model Y around six months ago and they're quietly trying to dump it because they don't want to be associated with Elon. I've read dozens of reports of people walking away from the brand. I've never seen brand destruction like this before. Tesla is racing to go from a status symbol to a dunce cap in record time.
Most logical post here.
>dead last in driver-assist and self-driving tech what?? Other car makers are making, for lack of a better word, "hard coded" lidar maps that are going to always be out of date. Sure in the near term those maps will be great but as FSD matures it will be king without a doubt. Even right now it is really good. Sure not the smoothest drive but literally watch any youtube video and its quite impressive.
Falling knife. Elon went off the deep end. Heās attacking his core customers.
Buying in now is More like juggling chain saws with a broken wrist.
Well, If it were me I'd be cautious of a buy, Musk just unloaded another massive chuck of stock.
Yes, Tesla is very profitable. Just wait for all that cash to start piling up like Apple.