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Tesla Will Become a $700B Gorilla, Top Investor Suggests

10 points by svirelka 10y ago

abc_lisper 10y ago
I don't see how people come up with crazy numbers like this. Honda sells a shit ton of cars, and it's market cap is 50Billion.. https://www.google.com/finance?q=NYSE:HMC https://www.google.com/finance?q=NYSE:HMC Toyota is 175 Billion with all the cars they call https://www.google.com/finance?q=NYSE%3ATM&ei=PqtYV8GCFOGqiQKLrblg https://www.google.com/finance?q=NYSE%3ATM&ei=PqtYV8GCFOGqiQ...
- jasode 10y ago
  >I don't see how people come up with crazy numbers like this. Honda sells a shit ton of cars, and it's market cap is 50Billion. I think the way to view $700B is to picture Tesla as diversified company of selling battery technology, self-driving AI algorithms, in addition to selling cars. E.g. the PowerWall for homes, or licensing self-driving tech to FedEx, UPS, garbage trucks, etc. I don't have a crystal ball but this type of "diversified world domination" thinking seems similar to the grand strategies of AlphabetGoogle and Apple. It would be similar to thinking of 1995 Amazon.com as "only an online bookseller" and underestimating its future market cap potential. If Barnes & Noble market cap is only $84 million, how can Amazon be worth $340 billion?!? Because investors and industry observers noticed that Jeff Bezos was expanding to sell CDs & DVDS, kitchen appliances, opening up a 3rd-party market platform, cloud computing with AWS, etc. Honda also does some other things besides cars (e.g. Honda lawn mowers and Honda motorcycles) but some people believe Tesla's ambitions outside of cars will be worth more. Today, Tesla car sales are only a tiny fraction of Honda's and yet it already has market cap of $34 billion.
arcanus 10y ago
Toyota's market cap is 200B VW is at 90B Ford is 53B GM is at 45 B Hyundai is 30B Roughly speaking he is predicting that not only will Tesla become the largest automotive company by valuation, but that it will be as large as all the others combined. I'm skeptical.
dragonwriter 10y ago
Phrased a different way: person with intense financial interest in other people thinking Tesla is worth lots of money says Tesla will be worth lots of money...
dharmon 10y ago
Ugh, I hate feeling like a Silicon Valley naysayer, but this outlook is entirely wishful thinking and not remotely rooted in fundamentals. But hey, why ruin a good story? Baron was once a legitimate investor and knew how to root out value, but now his business is fees off of a massive AUM. Its hard putting $26B to work in the market at a reasonable rate of return, so I guess he's resorting to "talking his book" and investing in popular stocks to make his wealthy clients feel comfortable in the crowd. He's apparently already gotten a little bounce off his comments, so good for him I guess.
maxxxxx 10y ago
Time to sell?
- svirelka 10y ago
  agree
ulfw 10y ago
Well if the top investor suggests it, then it MUST be true. Oh dear...
bfrog 10y ago
Silicon Valley, the place where numbers are farted out and believed daily.

10 points by svirelka 10y ago

I don't see how people come up with crazy numbers like this. Honda sells a shit ton of cars, and it's market cap is 50Billion.. https://www.google.com/finance?q=NYSE:HMC https://www.google.com/finance?q=NYSE:HMC Toyota is 175 Billion with all the cars they call https://www.google.com/finance?q=NYSE%3ATM&ei=PqtYV8GCFOGqiQKLrblg https://www.google.com/finance?q=NYSE%3ATM&ei=PqtYV8GCFOGqiQ...

jasode 10y ago
>I don't see how people come up with crazy numbers like this. Honda sells a shit ton of cars, and it's market cap is 50Billion. I think the way to view $700B is to picture Tesla as diversified company of selling battery technology, self-driving AI algorithms, in addition to selling cars. E.g. the PowerWall for homes, or licensing self-driving tech to FedEx, UPS, garbage trucks, etc. I don't have a crystal ball but this type of "diversified world domination" thinking seems similar to the grand strategies of AlphabetGoogle and Apple. It would be similar to thinking of 1995 Amazon.com as "only an online bookseller" and underestimating its future market cap potential. If Barnes & Noble market cap is only $84 million, how can Amazon be worth $340 billion?!? Because investors and industry observers noticed that Jeff Bezos was expanding to sell CDs & DVDS, kitchen appliances, opening up a 3rd-party market platform, cloud computing with AWS, etc. Honda also does some other things besides cars (e.g. Honda lawn mowers and Honda motorcycles) but some people believe Tesla's ambitions outside of cars will be worth more. Today, Tesla car sales are only a tiny fraction of Honda's and yet it already has market cap of $34 billion.

arcanus 10y ago

Toyota's market cap is 200B VW is at 90B Ford is 53B GM is at 45 B Hyundai is 30B Roughly speaking he is predicting that not only will Tesla become the largest automotive company by valuation, but that it will be as large as all the others combined. I'm skeptical.

dragonwriter 10y ago

Phrased a different way: person with intense financial interest in other people thinking Tesla is worth lots of money says Tesla will be worth lots of money...

dharmon 10y ago

Ugh, I hate feeling like a Silicon Valley naysayer, but this outlook is entirely wishful thinking and not remotely rooted in fundamentals. But hey, why ruin a good story? Baron was once a legitimate investor and knew how to root out value, but now his business is fees off of a massive AUM. Its hard putting $26B to work in the market at a reasonable rate of return, so I guess he's resorting to "talking his book" and investing in popular stocks to make his wealthy clients feel comfortable in the crowd. He's apparently already gotten a little bounce off his comments, so good for him I guess.

maxxxxx 10y ago

Time to sell?

svirelka 10y ago
agree

ulfw 10y ago

Well if the top investor suggests it, then it MUST be true. Oh dear...

bfrog 10y ago

Silicon Valley, the place where numbers are farted out and believed daily.