Time to buy Tesla?

[GingerandPiper]

I'm grinning as I write this. I just got a text from my freshman in college grandson who advised me to put $50 in Tesla because the stock is going up!

Well, I guess there is "fun money" to be spent but.....

I think I'll pass, but still wanted to alert the Boglehead community of this opportunity.

Ginger

[Dottie57]

I think I have me some Tesla in total stock index -so I am good!

[beehivehave]

So what does your garbageman and the bagger at the grocery store advise?

[TropikThunder]

I'm grinning as I write this. I just got a text from my freshman in college grandson who advised me to put $50 in Tesla because the stock is going up!

Well, I guess there is "fun money" to be spent but.....

I think I'll pass, but still wanted to alert the Boglehead community of this opportunity.

Ginger

Too bad he's not a sophomore, he could have told you this a year ago.

[NotTooDeepLearning]

Your grandson might be interested in Aswath Damodaran's blog. Hes an NYU professor that specializes in valuations and posts some of his work publicly. He just recently (January 30th) updated his Tesla valuation. He bought it at $180!

http://aswathdamodaran.blogspot.com/?_s ... tvK06K81Qp

[Wiggums]

If you own the market, you already had Tesla! Just remember that the markets go up and down. This is probably short covering since Tesla is heavily shorted. Fast, Irrational market moves normally do not end well. I’m personally not impressed with a stock that goes up 60% in 6 days as a long term investor. Accurately predict the future and you have my attention.

[stocknoob4111]

everyone around me is talking about TSLA.. even some of my co-workers are buying due to FOMO, this is how you know it's a classic bubble.

Ralph Nader made a good observation recently, TSLA's market cap now exceeds VW by a country mile which is truly stunning given that VW is the world's largest and one of the oldest automakers, in business since 1937 through all sorts of tumultuous economic periods... Tesla is nothing more than an ant compared to VW. This stock price is a joke!

[stocknoob4111]

Oh, and TSLA delivered 360K cars last year and was barely profitable... VW sold 11 million and had $20 billion in NET profits!!!

[3funder]

Based on my college experience, 18 year-old males are the wisest subset of people known to have ever walked the planet. I think I'll buy me some Tesla right now.

[iamlucky13]

Your grandson might be interested in Aswath Damodaran's blog. Hes an NYU professor that specializes in valuations and posts some of his work publicly. He just recently (January 30th) updated his Tesla valuation. He bought it at $180!

http://aswathdamodaran.blogspot.com/?_s ... tvK06K81Qp

That's fairly interesting, although in part simply because it validates my sense that the stock is overpriced. I had a few observations:

He's basically assuming they will have 5 years replicating Amazon's past revenue growth - about 25% annual increases - and then another 5 years at 10% growth. That puts them at 2 million cars annually by 2020, and $125 billion in revenue.

That would have them roughly on par with where BMW is right now. BMW currently produces about 25% of what they consider to be the premium car market, which is currently 9.5 million vehicles, and which they forecast to be 11.8 million vehicles in 2031.

So that part of the analysis seems ambitious to me, but credible for what is anticipated to be a disruptive product where their competitors are a few years behind.

However, BMW currently averages $38,000 USD per sale (no doubt higher for just the US segment), while the linked author is counting on Tesla averaging $62,500 per sale. That means over 60% higher pricing than one of the main competitors, and increasing volume while staying in a more exclusive part of the premium market.

While Tesla currently averages about $67,000 per sale, that is driven in large part by the Model S and X. My assumption is demand for those models is only growing slowly, or else they'd be focusing more of their capacity expansion on those high value cars, and in fact they saw a pretty significant hit to Model S and X sales when the 3 started shipping in significant numbers.

His conclusion is that Tesla is currently overpriced by 108%. I'd say that seems too optimistic, not due any expectation of Tesla failing or even due to unrealistic unit volume growth, but due to overly optimistic unit pricing.

[lexor]

I think I have me some Tesla in total stock index -so I am good!

I thought it wasn't in most indicies yet due to no proven track record of protfits

[bugleheadd]

I think I have me some Tesla in total stock index -so I am good!

I thought it wasn't in most indicies yet due to no proven track record of protfits

does the total stock market index ( VTI or VTSAX) have it or am i mistaken?

[Brianmcg321]

I think I have me some Tesla in total stock index -so I am good!

I thought it wasn't in most indicies yet due to no proven track record of protfits

Its not in the S&P 500 yet.

It is in Total Market. Because you now, Total, means everything.

https://qz.com/1587963/how-the-sp-500-i ... -go-in-it/

[T20three]

I'm grinning as I write this. I just got a text from my freshman in college grandson who advised me to put $50 in Tesla because the stock is going up!

Texts like this = time to short.

[EnjoyIt]

I'm grinning as I write this. I just got a text from my freshman in college grandson who advised me to put $50 in Tesla because the stock is going up!

Well, I guess there is "fun money" to be spent but.....

I think I'll pass, but still wanted to alert the Boglehead community of this opportunity.

Ginger

Not that your grandson is a shoe shine boy, but when those without knowledge start offering stock tips, it may be time to sell.

A few months before bitcoin dropped from $20k I was eating lunch overhearing a college kid trying to convince his parents how amazing bitcoin was.

T20Threw is right.
I think it’s time to short Tesla
To bad I only buy index funds and don’t short anything.

[tesuzuki2002]

I bought it back in November.... I got LUCKY

[1789]

Time to sell not buy

[hagridshut]

I'm grinning as I write this. I just got a text from my freshman in college grandson who advised me to put $50 in Tesla because the stock is going up!

Hah, well, I know that you don't need my input, but for anyone else who is tempted: I strongly discourage people from having anything to do with TSLA.

The vast majority of people don't have the business and technological expertise to understand Tesla. Of the small % of people who can sort of understand Tesla, an even smaller subset will be able to mentally withstand the outrageous volatility of the stock. Most will buy high and sell low out of panic.

To be blunt, for most people, buying TSLA will be an exercise in stupidity and ultimately result in lost money. Shorting TSLA is equally stupid and will likely result in lost money. The volatility is far too high and unpredictable. Don't be stupid. Stay far, far away from anything to do with this stock.

[dixdak]

Bought some and sold a week later in the 900s when the chart looked like a triple black diamond run and put proceeds into VDE- Oil that is, black gold, Texas tea. I am ready for my nephew now!

[AlphaLess]

I'm grinning as I write this. I just got a text from my freshman in college grandson who advised me to put $50 in Tesla because the stock is going up!

Well, I guess there is "fun money" to be spent but.....

I think I'll pass, but still wanted to alert the Boglehead community of this opportunity.

Ginger

It's going to be $7K very soon.

[annu]

I predict SPCE will be next one to go insane like TSLA

[SuperSaver]

Wonder what all the nay-sayers think now about Tesla stock price.

[hnd]

i bought a few shares at $800 and i added another at $1400.

[Blueskies123]

Oh, and TSLA delivered 360K cars last year and was barely profitable... VW sold 11 million and had $20 billion in NET profits!!!

and then In April 2017, a US federal judge ordered Volkswagen to pay a $2.8 billion criminal fine for "rigging diesel-powered vehicles to cheat on government emissions tests". The "unprecedented" plea deal formalized the punishment which Volkswagen had agreed to. All those 11 million vehicles are burning hydrocarbons and 50% are leaking hazardous chemicals.
http://answers.google.com/answers/threa ... 51798.html

What do you think the automotive industry will look like in 5 to 10 years?

[Prettyfrtnt]

Wonder what all the nay-sayers think now about Tesla stock price.

Just remember even now everyone is asleep on the 25% of the float that will need to be purchased by indexes.

Shorts keep forgetting and burning themselves and these new highs.

The missing element in all this is the vast majority of the equity is owned by very rich fanbois that all drive Tesla’s and are buy and hold “until my great granddaughter sells to buy a ticket to Mars.”

So many people are not opening their eyes and telling me two years ago, last year, this month, last month “it’s overvalued.” When gains like this are cooked in and the way capital gains taxes work... retail investors are locking up the float here. Elon said it best last earnings call: “retail investors are much more sophisticated in their understanding of our business.”

Thanks to the voices here who supported 10% NW in individual equities.

[Prettyfrtnt]

Duplicate

[anoop]

I predict SPCE will be next one to go insane like TSLA

I disagree. I'm starting to see Tesla as an energy company that builds cars. In the space arena, SpaceX has similar potential doing many different things from exploration to Internet-in-the-sky, so if they were public they would be huge.

[Normchad]

Welp, I bought my shares in November at 380/share. I sold them all today, and cleared enough profit to buy a nice new Model Y.....

[SD2SR]

Oh, and TSLA delivered 360K cars last year and was barely profitable... VW sold 11 million and had $20 billion in NET profits!!!

BUT IT'S THE FUTURE!!

[4nursebee]

People that have argued against tsla over the years have made some good rationale points and been totally wrong. I added to tsla last week.

[infotrader]

My undergraduate son asked me to buy to two stocks in the fields I was not not familiar with in 2013, and I listened both times.
They are TSLA and FB.

[JonnyDVM]

I stayed away. Now a lot of us have egg on our faces. For what it’s worth I’m still being told to buy it from the Elon Musk fans. “Plenty of room to go up!!!” I’m still not listening.

[Makaveli]

I'm grinning as I write this. I just got a text from my freshman in college grandson who advised me to put $50 in Tesla because the stock is going up!

Texts like this = time to short.

Careful here. Nearly everyone agrees that Tesla is overvalued but timing the short is tricky. My colleague took a stab at $1,550. It sits north of $1,800 today. Last I looked there is nearly $20,000,000,000 of shorts on Tesla. I watched a youtube video on the "short squeeze" and all the upward momentum that creates.

What's that saying? When you play with fire...

[EnjoyIt]

Something about being solvent longer than the market being irrational.

I do love Tesla and what they do. Just not buying any individual stocks anymore.

[CorduroyGivenToFly]

The current valuation is probably pricing in lots of things including future Mobility as a Service, being able to dramatically increase battery life at low cost, and some other things being hinted at recently by Musk such as licensing Tesla’s technology to other auto makers that are better at production and logistics at scale. Lots has to go right. Of all those, Mobility as a Service is probably the biggest long shot/questionable item. At least in the short term.

[klondike]

Last I looked there is nearly $20,000,000,000 of shorts on Tesla. I watched a youtube video on the "short squeeze" and all the upward momentum that creates.

It is always fun to see short sellers getting burned.

[annu]

I predict SPCE will be next one to go insane like TSLA

I disagree. I'm starting to see Tesla as an energy company that builds cars. In the space arena, SpaceX has similar potential doing many different things from exploration to Internet-in-the-sky, so if they were public they would be huge.

Just quick on SPCE, I bought 5 shares on Feb 6th and sold them Feb 25, my only capital gains for the year.

They might be an energy company, but their core money is comming from cars, and quality of cars is trending down, I know of few folks personally who say things like headlights misaligned, interior looking all messy on brand new cars they went to pick up.

Back to energy, there already few companies who have better range/solution than Tesla, at a much smaller and unproven scale though, but they have serious money and good teams

[Oregano]

My view of TSLA hasn't changed. The accounting is fraudulent and the stock is probably worthless. But crazy people will do crazy things and run up valuations on worthless stocks - that has happened many times in stock market history. I don't really care what happens, though. I have never bet against a stock by shorting or buying puts. But if your argument is that "the stock went up, therefore this company is legitimately valuable", you must be new to investing.

[ralph124cf]

I predict SPCE will be next one to go insane like TSLA

I disagree. I'm starting to see Tesla as an energy company that builds cars. In the space arena, SpaceX has similar potential doing many different things from exploration to Internet-in-the-sky, so if they were public they would be huge.

Note: SPCE is Virgin Galactic, a publicly traded company. SpaceX is a private company with no publicly traded stock.

Ralph

[Prettyfrtnt]

My view of TSLA hasn't changed. The accounting is fraudulent and the stock is probably worthless. But crazy people will do crazy things and run up valuations on worthless stocks - that has happened many times in stock market history. I don't really care what happens, though. I have never bet against a stock by shorting or buying puts. But if your argument is that "the stock went up, therefore this company is legitimately valuable", you must be new to investing.

If you own a total stock market fund then it’s one of your top 10 holdings. If you own an S&P500 fund then you’re about to purchase 20% of the TSLA float. (Last I checked the price seemed pretty high).

“Accounting fraudulent and stock is worthless” so 2018. Along with “He will never make a rocket land itself”.

[Carguy85]

I had no idea rockets were landing themselves until the other day when talking about Tesla/ spacex with my bro...he told me and I was dumbfounded....then we searched some YouTube vids...pretty funny to see them land like they do. It also makes me smile when Tesla is brought up in the forum...fairly obvious who has vested interest. I wish all that own individual TSLA shares the best of luck timing just when to jump ship.

[Oregano]

My view of TSLA hasn't changed. The accounting is fraudulent and the stock is probably worthless. But crazy people will do crazy things and run up valuations on worthless stocks - that has happened many times in stock market history. I don't really care what happens, though. I have never bet against a stock by shorting or buying puts. But if your argument is that "the stock went up, therefore this company is legitimately valuable", you must be new to investing.

If you own a total stock market fund then it’s one of your top 10 holdings. If you own an S&P500 fund then you’re about to purchase 20% of the TSLA float. (Last I checked the price seemed pretty high).

“Accounting fraudulent and stock is worthless” so 2018. Along with “He will never make a rocket land itself”.

I don't own any stocks, so no exposure to TSLA. The company financial are a fraud. It was before 2018 and still is. Just take a look at Wirecard as the most recent example of a company that was suspected of fraud for a decade but somehow avoid consequences all that time. So the idea that it hasn't mattered yet means it never well, unfortunately, doesn't hold in the real world.

I have never in my life had anything to see about any of Musk's other companies. But you're conflating two independent issues, you see. I'm not saying the products are a fraud (although there are many who say Tesla cars have serious quality issues, but I don't have an opinion), I'm saying the FINANCIALS are a fraud. You can have a legitimate product wrapped inside of a fraudulent operation.

[cowbman]

My view of TSLA hasn't changed. The accounting is fraudulent and the stock is probably worthless. But crazy people will do crazy things and run up valuations on worthless stocks - that has happened many times in stock market history. I don't really care what happens, though. I have never bet against a stock by shorting or buying puts. But if your argument is that "the stock went up, therefore this company is legitimately valuable", you must be new to investing.

If you own a total stock market fund then it’s one of your top 10 holdings. If you own an S&P500 fund then you’re about to purchase 20% of the TSLA float. (Last I checked the price seemed pretty high).

“Accounting fraudulent and stock is worthless” so 2018. Along with “He will never make a rocket land itself”.

I don't own any stocks, so no exposure to TSLA. The company financial are a fraud. It was before 2018 and still is. Just take a look at Wirecard as the most recent example of a company that was suspected of fraud for a decade but somehow avoid consequences all that time. So the idea that it hasn't mattered yet means it never well, unfortunately, doesn't hold in the real world.

I have never in my life had anything to see about any of Musk's other companies. But you're conflating two independent issues, you see. I'm not saying the products are a fraud (although there are many who say Tesla cars have serious quality issues, but I don't have an opinion), I'm saying the FINANCIALS are a fraud. You can have a legitimate product wrapped inside of a fraudulent operation.

I don't about the financials, but they did not support the price at $330/share much less $2000/share. That being said, none of the other car companies are able to compete on electric vehicles. The Semi will be much lower to run then current diesel. Elon was planning on offering Megachargers that made it less than rail too. The big one in my book though is there ability to cut the cost on solar panels to almost $1/watt after incentives and the electric market autotrader software they've developed. The cult following was keeping the price high, but now the market is pricing in that TSLA will conquer autos and the electric market. If it does, that would make it probably a top 5 or 10 company. (It's 11 as of 8/22/2020).

https://youtu.be/9h_CL1JxbCU

[Oregano]

My view of TSLA hasn't changed. The accounting is fraudulent and the stock is probably worthless. But crazy people will do crazy things and run up valuations on worthless stocks - that has happened many times in stock market history. I don't really care what happens, though. I have never bet against a stock by shorting or buying puts. But if your argument is that "the stock went up, therefore this company is legitimately valuable", you must be new to investing.

If you own a total stock market fund then it’s one of your top 10 holdings. If you own an S&P500 fund then you’re about to purchase 20% of the TSLA float. (Last I checked the price seemed pretty high).

“Accounting fraudulent and stock is worthless” so 2018. Along with “He will never make a rocket land itself”.

I don't own any stocks, so no exposure to TSLA. The company financial are a fraud. It was before 2018 and still is. Just take a look at Wirecard as the most recent example of a company that was suspected of fraud for a decade but somehow avoid consequences all that time. So the idea that it hasn't mattered yet means it never well, unfortunately, doesn't hold in the real world.

I have never in my life had anything to see about any of Musk's other companies. But you're conflating two independent issues, you see. I'm not saying the products are a fraud (although there are many who say Tesla cars have serious quality issues, but I don't have an opinion), I'm saying the FINANCIALS are a fraud. You can have a legitimate product wrapped inside of a fraudulent operation.

I don't about the financials, but they did not support the price at $330/share much less $2000/share. That being said, none of the other car companies are able to compete on electric vehicles. The Semi will be much lower to run then current diesel. Elon was planning on offering Megachargers that made it less than rail too. The big one in my book though is there ability to cut the cost on solar panels to almost $1/watt after incentives and the electric market autotrader software they've developed. The cult following was keeping the price high, but now the market is pricing in that TSLA will conquer autos and the electric market. If it does, that would make it probably a top 5 or 10 company. (It's 11 as of 8/22/2020).

https://youtu.be/9h_CL1JxbCU

Now tell me how much capital would need to be raised to allow Tesla to "conquer autos and the electric market". Since the company doesn't actually make any money, all of that capital will need to be raised from investors. Are they going to continue to buy shares endlessly as they get diluted?

[neverpanic]

I hear chatter from a lot of people who are buying into the split. The ride to $2000 was fun, I'm cashing out on Monday. I may keep a single share just because.

[jschlocker]

It seems “crazy high” but, I own a Model X (after a Chevy Volt, which I still miss!), paid 22 k for Tesla Solar and Powerwall (best investment ever!). California power outages and my lights don’t even blink when it switches to Powerwall and runs my house all night and then solar recharges the battery. If I’m careful, I can normally charge my car, and run my house, and get a 100 buck monthly credit on my PGE bill (during summer). Payback I figured maybe ten years but it beats nearly paying Vanguard to keep money in my Money Market.
Tesla stock is a winner long term, short term is scary!

[Normchad]

I don't own any stocks, so no exposure to TSLA. The company financial are a fraud. It was before 2018 and still is.

This is a serious allegation. Is there any credible evidence to support it?

[Carguy85]

Thank goodness for regulatory credit sales....although with the current p/e I’m not so sure that this matters much to shareholders

[Oregano]

I don't own any stocks, so no exposure to TSLA. The company financial are a fraud. It was before 2018 and still is.

This is a serious allegation. Is there any credible evidence to support it?

Lol. You must be new to TSLA. Google it.

[tesuzuki2002]

I predict SPCE will be next one to go insane like TSLA

keep and eye on it... as commercial service operations approach...