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You're misunderstanding what market cap is and trying to equate it with sales and other real-world metrics. The market cap is simply the number of TSLA shares t

You're misunderstanding what market cap is and trying to equate it with sales and other real-world metrics. The market cap is simply the number of TSLA shares times the price per share. Full stop. Tesla manufactures, sells, and maintains vastly fewer cars than even any single one of their competitors, nevermind all of them put together. None of that matters or has anything to do with market cap.

jliptzin 6y ago
No, he’s not.
foota 6y ago
What's your point? Market cap is a forward looking measure of perceived future revenues and profitability, for which their current situation and the overall markets they're in are very relevant (not to mention very much relevantly for TSLA, expectations of how well they can execute).
Retric 6y ago
No, he’s saying judging Tesla’s market cap based on car manufacturers is like measuring Apple relative to other watch manufacturers. Ford doesn’t do direct to consumer sales, own a charging network or even gas’s station etc. Yep, they happen to build cars but if that’s the kind of analysis you’re doing the market will eat you alive. I don’t think it justifies their current market cap, but plenty of companies looked over priced 10 years ago yet ended up being great investments. Hell, I remember thinking Bitcoin was pricy at 30$, watching it crash etc.
- mgh2 6y ago
  In addition to the hype, the current 10x market cap increase may be partly due to all the short sellers being squeezed out https://en.wikipedia.org/wiki/Short_squeeze#:~:text=A%20short%20squeeze%20is%20a,covering%20(liquidating)%20their%20positions https://en.wikipedia.org/wiki/Short_squeeze#:~:text=A%20shor.... https://markets.businessinsider.com/news/stocks/tesla-stock-most-shorted-us-beats-apple-highest-short-interest-2020-1-1028823046 https://markets.businessinsider.com/news/stocks/tesla-stock-...
  - dev-ns8 6y ago
    We have to assume this is partly the reason for the parabolic increase in TSLA stock price don't we? Thinking out loud here, correct me if I'm wrong anywhere.. According to your second source, there was $14.5B worth of shorted shares on 1/14/2020 and the closing price for $TSLA on that day was $107.58. According to the source below [1], as of 11/15/2020 there was $27.19B worth of short shares. Closing price 11/16 was $408.09 Shares shorted 1/14/2020: 14.5B / 107.58 = 134.78 Million Shares Shares shorted 11/16/2020: 27.19B / 408.09 = 66.62 Million Shares According to TSLA July 2020 10Q they had 186M shares outstanding [2] so while not the most accurate when comparing a 9 month change in Shorted shares, we can estimate in the neighborhood of 1/3rd the shares on the market were covered by short sellers. [1] https://www.marketbeat.com/stocks/NASDAQ/TSLA/short-interest/ https://www.marketbeat.com/stocks/NASDAQ/TSLA/short-interest... [2]https://www.sec.gov/Archives/edgar/data//1318605/000156459020033670/tsla-10q_20200630.htm https://www.sec.gov/Archives/edgar/data//1318605/00015645902...
- reitzensteinm 6y ago
  FWIW, Ford is actually drawing a line in the sand, and all EVs will be available to order directly from them online. It will be interesting to see whether they can maintain this stance as EVs transition from a small uninteresting slice of the pie (for dealerships) to the entire product line over the next few decades. I strongly suspect Ford took a hard look at what Tesla is doing and sees the way the wind is blowing. It wouldn't have been a popular move. https://insideevs.com/news/444131/ford-mustang-mach-e-online-sales/ https://insideevs.com/news/444131/ford-mustang-mach-e-online...

jliptzin 6y ago

No, he’s not.

foota 6y ago

What's your point? Market cap is a forward looking measure of perceived future revenues and profitability, for which their current situation and the overall markets they're in are very relevant (not to mention very much relevantly for TSLA, expectations of how well they can execute).

Retric 6y ago

No, he’s saying judging Tesla’s market cap based on car manufacturers is like measuring Apple relative to other watch manufacturers. Ford doesn’t do direct to consumer sales, own a charging network or even gas’s station etc. Yep, they happen to build cars but if that’s the kind of analysis you’re doing the market will eat you alive. I don’t think it justifies their current market cap, but plenty of companies looked over priced 10 years ago yet ended up being great investments. Hell, I remember thinking Bitcoin was pricy at 30$, watching it crash etc.

mgh2 6y ago
In addition to the hype, the current 10x market cap increase may be partly due to all the short sellers being squeezed out https://en.wikipedia.org/wiki/Short_squeeze#:~:text=A%20short%20squeeze%20is%20a,covering%20(liquidating)%20their%20positions https://en.wikipedia.org/wiki/Short_squeeze#:~:text=A%20shor.... https://markets.businessinsider.com/news/stocks/tesla-stock-most-shorted-us-beats-apple-highest-short-interest-2020-1-1028823046 https://markets.businessinsider.com/news/stocks/tesla-stock-...
- dev-ns8 6y ago
  We have to assume this is partly the reason for the parabolic increase in TSLA stock price don't we? Thinking out loud here, correct me if I'm wrong anywhere.. According to your second source, there was $14.5B worth of shorted shares on 1/14/2020 and the closing price for $TSLA on that day was $107.58. According to the source below [1], as of 11/15/2020 there was $27.19B worth of short shares. Closing price 11/16 was $408.09 Shares shorted 1/14/2020: 14.5B / 107.58 = 134.78 Million Shares Shares shorted 11/16/2020: 27.19B / 408.09 = 66.62 Million Shares According to TSLA July 2020 10Q they had 186M shares outstanding [2] so while not the most accurate when comparing a 9 month change in Shorted shares, we can estimate in the neighborhood of 1/3rd the shares on the market were covered by short sellers. [1] https://www.marketbeat.com/stocks/NASDAQ/TSLA/short-interest/ https://www.marketbeat.com/stocks/NASDAQ/TSLA/short-interest... [2]https://www.sec.gov/Archives/edgar/data//1318605/000156459020033670/tsla-10q_20200630.htm https://www.sec.gov/Archives/edgar/data//1318605/00015645902...
reitzensteinm 6y ago
FWIW, Ford is actually drawing a line in the sand, and all EVs will be available to order directly from them online. It will be interesting to see whether they can maintain this stance as EVs transition from a small uninteresting slice of the pie (for dealerships) to the entire product line over the next few decades. I strongly suspect Ford took a hard look at what Tesla is doing and sees the way the wind is blowing. It wouldn't have been a popular move. https://insideevs.com/news/444131/ford-mustang-mach-e-online-sales/ https://insideevs.com/news/444131/ford-mustang-mach-e-online...