4 ms·

Tesla surpasses $1T market value

19 points by 0xedb 5y ago

blip54321 5y ago
That's a market cap of around $3000 per American or $100 per human being in the world. That feels high. Tesla sells around a million cars per year. That valuation is around $1M per car sold annually. That feels high too. I'm bullish about Tesla. I think they're going in the right direction. However, I can't run sensible numbers that make this valuation feel right. I'm not shorting Tesla, mind you. An irrational market can keep going much longer than my wallet.
- rp1 5y ago
  I don’t think measuring thing vs. cars sold is particularly useful. One way to look at it is this: their P/E is around 330. Their net income grew at 300% last quarter (y/y) and their growth seems to be accelerating. If the price and growth rate was constant, then the P/E ratio would be 82 in just a year. Still high, but not unreasonable for a high growth company.
  - blip54321 5y ago
    There's only so much accelerating that can happen. At some point, the market saturates. I looked at Tesla's share of the car market too.
- benlivengood 5y ago
  I think it's a combination of speculation, economic eco-activism, and futurism which will keep Tesla's market cap a self-fulfilling prophecy. Even $3000/person seems like a pretty good deal to make cheap grid batteries and zero-emission transport widely available, even as charity. Then there are the fairly outlandish AI/robot/neuralink promises that Musk can get away with. Even 5-year-late delivery on those promises would have a tremendous impact and so presumably some investors are betting on that as well. If you take a long view of Musk's projects he's building the infrastructure to colonize Mars (solar, battery storage, rockets, autonomous electric vehicles, trains that operate at Mars' atmospheric pressure). That's unique in the market today and without the ability to invest in SpaceX normal folks will choose Tesla even if it doesn't make much financial sense.
maxharris 5y ago
I wrote this incredibly unappreciated comment (it got upvoted once) back in April 2020, explaining why I put my life savings ($100k) into Tesla and tech stocks at the bottom of the crash in March 2020: https://news.ycombinator.com/item?id=22970810 https://news.ycombinator.com/item?id=22970810 I raised my position to 86% TSLA shortly thereafter: https://news.ycombinator.com/item?id=25555778 https://news.ycombinator.com/item?id=25555778 And in February this year (at the peak) I dumped my last shares of SQ to go all-in on TSLA. I was right, and the people I was arguing with were wrong. I do wish they'd contact me and pick up the conversation, though...
- sschueller 5y ago
  If you haven't sold any of it yet, you also haven't made any money. You should at least take out what you put in plus interest. Then in the worst case you make out the same as if you didn't do anything with it.
- ecpottinger 5y ago
  Most of them never will. There is one thing wrong with most people, the lack of willingness to admit their mistakes and that they made the wrong decisions. Tesla is (was before the run-up) only one third of my portfolio and I was told repeatedly that I would lose all my money. The people telling this had made good money on the stock market before and now thought they knew it all. Not only were they wrong, but I also have already sold enough of my Tesla stock to get back all the money I invested. Yet, on the other side others shows up and says I should never have sold any stock, just it ride. Of-course those same people will quickly vanish if I followed their advice and the stock crashed. The one thing I learnt, do not 100% trust so-called experts and do your own research. Earl Colby Pottinger PS. And never invest money you can't afford to lose.
- cinntaile 5y ago
  Just because you were right doesn't make it a good decision to put nearly all your life savings into one company. You have people claiming similar things about bitcoin for example. I mean... Good for you, but the roads are paved with people that had similar convictions about all kinds of companies and projects.

19 points by 0xedb 5y ago

That's a market cap of around $3000 per American or $100 per human being in the world. That feels high. Tesla sells around a million cars per year. That valuation is around $1M per car sold annually. That feels high too. I'm bullish about Tesla. I think they're going in the right direction. However, I can't run sensible numbers that make this valuation feel right. I'm not shorting Tesla, mind you. An irrational market can keep going much longer than my wallet.

rp1 5y ago
I don’t think measuring thing vs. cars sold is particularly useful. One way to look at it is this: their P/E is around 330. Their net income grew at 300% last quarter (y/y) and their growth seems to be accelerating. If the price and growth rate was constant, then the P/E ratio would be 82 in just a year. Still high, but not unreasonable for a high growth company.
- blip54321 5y ago
  There's only so much accelerating that can happen. At some point, the market saturates. I looked at Tesla's share of the car market too.
benlivengood 5y ago
I think it's a combination of speculation, economic eco-activism, and futurism which will keep Tesla's market cap a self-fulfilling prophecy. Even $3000/person seems like a pretty good deal to make cheap grid batteries and zero-emission transport widely available, even as charity. Then there are the fairly outlandish AI/robot/neuralink promises that Musk can get away with. Even 5-year-late delivery on those promises would have a tremendous impact and so presumably some investors are betting on that as well. If you take a long view of Musk's projects he's building the infrastructure to colonize Mars (solar, battery storage, rockets, autonomous electric vehicles, trains that operate at Mars' atmospheric pressure). That's unique in the market today and without the ability to invest in SpaceX normal folks will choose Tesla even if it doesn't make much financial sense.

maxharris 5y ago

I wrote this incredibly unappreciated comment (it got upvoted once) back in April 2020, explaining why I put my life savings ($100k) into Tesla and tech stocks at the bottom of the crash in March 2020: https://news.ycombinator.com/item?id=22970810 https://news.ycombinator.com/item?id=22970810 I raised my position to 86% TSLA shortly thereafter: https://news.ycombinator.com/item?id=25555778 https://news.ycombinator.com/item?id=25555778 And in February this year (at the peak) I dumped my last shares of SQ to go all-in on TSLA. I was right, and the people I was arguing with were wrong. I do wish they'd contact me and pick up the conversation, though...

sschueller 5y ago
If you haven't sold any of it yet, you also haven't made any money. You should at least take out what you put in plus interest. Then in the worst case you make out the same as if you didn't do anything with it.
ecpottinger 5y ago
Most of them never will. There is one thing wrong with most people, the lack of willingness to admit their mistakes and that they made the wrong decisions. Tesla is (was before the run-up) only one third of my portfolio and I was told repeatedly that I would lose all my money. The people telling this had made good money on the stock market before and now thought they knew it all. Not only were they wrong, but I also have already sold enough of my Tesla stock to get back all the money I invested. Yet, on the other side others shows up and says I should never have sold any stock, just it ride. Of-course those same people will quickly vanish if I followed their advice and the stock crashed. The one thing I learnt, do not 100% trust so-called experts and do your own research. Earl Colby Pottinger PS. And never invest money you can't afford to lose.
cinntaile 5y ago
Just because you were right doesn't make it a good decision to put nearly all your life savings into one company. You have people claiming similar things about bitcoin for example. I mean... Good for you, but the roads are paved with people that had similar convictions about all kinds of companies and projects.