If Tesla sells (heh, and builds) every one of their pre-ordered model 3's, that's over $14b in revenue.
The only question is, are they going to be able to do it. If both departments at Goldman think the answer is "YES", then what they have done is absolutely reasonable.
So Tesla:Ford ratio on market cap is 1:2, but on sales numbers it's 1:100. Granted, the Model S is more expensive than an average Ford, so let's call it 1:50.
How is that undervalued? It looks pretty darned overvalued to me.
You'd have to be insane to believe that Tesla is going to be making $400BB within 5 years.
Yes, there's some fudge factor when trying to estimate what a company like Tesla might look like in the future, but it still should be based on potential financials.
If you believe that electric and autonomous car is the future and that Tesla will dominate the electric and autonomous car market, especially starting in 2020 already selling 1 million car a year with 2 new even more affordable models ?
Not saying that is realistic, but if you are buying the stock of the global number 1 car maker of 2030, that is probably a good deal.
That said, I think its very unlikely there is any link between the offering and their analysis.
A simple example is, imagine making pizzas for your neighbors, and it takes you 15 minutes to make dough for 1 pizza, and at a $10/hr wage, that's $2.50 per pizza in dough labor costs. Now, imagine it only takes you 20 minutes to make dough for 5 pizzas. That's $3.33 in dough labor costs for 5 pizzas, or $.66/ea.