Peak Tesla
TSLA Price 29th April 2021 – $7.00
I am calling peak tesla.
I know this is a Marco thread and Tesla is as far as you can get from where we are but I want to comment, if you don’t want to read then **c* off and skip this post.
This is not an indepth analysis but a couple of points
a) Companies that do things like this are trash and desparate:
https://www.ft.com/content/8014e86f-c06d-4175-ad63-f459d7cd9929
b) Profit includes $518m from ‘regulatory credits’. These credits are paid by other car companies because they don’t sell enough electric vehicles. This is completely crazy, Tesla is being funded by it’s competitors. This is unstainable (as they can’t grow with ggrowth beyond a certain value) and is likely to end when the other manufacturers start producing their own cars.
c) So Tesla booked a $438m profit for Q1 2021. This includes the $101m from Bitcoin speculation and the $518m from regulatory credits. If you remove both of these Tesla actually made a loss of $181m for the quarter.
d) Growth obstacles. There are a plethora of potential problems that Tesla might come up against in the next 5 years including recessions, lack of resources like Lithium, supply chain problems like the chips for other car companies, bad sales, competition etc. Investors have priced in 40% growth to infinity so something is likely to fail.
e) Musk. Even though he is clearly capable fo changing and inventing entire markets across the globe he is also a bit unpredictable. Also he might get ill. Tesla future is pinned on one man and this is never a good idea. He also seemed to go through a phase where he looked to be eating too many burgers and overworking, hopefully he is looking after himself now.
I don’t expect Tesla to fall from grace immediately and their investers are somewhere between religious and delusional but most of the above will start to drag on the share price over the next couple of years and the JPG shows they are manipulating expectations. The Bitcoin purchase might also be done to continue the hype for longer and allow drawdown of profits as and when needed to massage figures and earnings misses (at huge risk).
