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The world has gone insane... treating a manufacturing company like it's a tech company and applying the "appropriate" multiples. People are going to lose their
by u10 6y ago
The world has gone insane... treating a manufacturing company like it's a tech company and applying the "appropriate" multiples. People are going to lose their shirts on this one.
- deleted 6y ago[deleted]
- the-dude 6y agoTesla is by no means just a manufacturing company.
- u10 6y agoTheir core business is manufacturing. The vast majority of their RnD and capex goes into manufacturing. They don't sell software, they sell cars.
- alextheparrot 6y agoCouldn’t you apply this same principle to Apple from ~2000 until current? It seems, at least in some pocket markets, there exists an intersection where manufacturing and technology combine to be highly profitable. Maybe car manufacturing isn’t one of those places, but I feel like that’s more difficult to dismiss as flippantly.
- u10 6y agoNot really, for one Apple outsources their manufacturing to various companies (TSMC, Foxconn, AMD, Intel, etc). This allows Apple to focus on design and software (ie, the hardware design follows the software, unlike Tesla where the software follows the hardware, so to speak), and not get bogged down in the manufacturing process. Apple handles the design and software, not the manufacturing.
- jeffreyrogers 6y agoThe more things I've seen like this, the more I realize the wisdom of Keyne's quote, "the market can stay irrational longer than you can stay solvent", or something to that effect. There have been a number of publicly traded companies I've seen with outrageous valuations, that've shocked me by how long they've maintained them. I've probably been right about the eventual outcome about 70% of the time, but I would have lost a ton of money trying to bet against them.