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>The point is that Tesla doesn't move anywhere near enough volume or generate anywhere near enough sales to justify its market cap. Buying TSLA right now is ma
by gozur88 11y ago
>The point is that Tesla doesn't move anywhere near enough volume or generate anywhere near enough sales to justify its market cap.
Buying TSLA right now is making a big bet on the Model 3. If Tesla comes out with a popular car (likely) and can make enough of them to turn a profit (little more skeptical on that one), it may end up justifying valuations. I wouldn't put my money on it, but I'm not surprised other people do.
- redthrowaway 11y agoI think that's a fair point. I suspect Tesla will end up being very much like Amazon: a company that ships physical goods but acts like a tech company. That is, they'll operate on razor-thin margins and dump every penny of profit into R&D in perpetuity. That will probably give them a leg up on companies that pay dividends, at least in the short-medium term. Ultimately, though, they run the "risk" of being Apple: a company that has to spend inordinate sums on R&D in order to gain a 1- or 2-year window of exclusivity before the competition commoditizes their product.