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> If they keep growing at And that's where the falacy is. Nothing keeps growing forever. Past performance is no guarantee of future results.

You don't need great analysis to see that something that has appreciated 131 times in less than a year is a bubble, unless they cured cancer or seriously undersold at their IPO. And no one undersells by that much.

> something that has appreciated 131 times in less than a year

What has appreciated 131 times in a year?

I'm not sure what it means to count up the number of times a stock has appreciated in a year. A stock with steady, reasonable 2% annual growth could in principle appreciate on every trading day.

Only if every trading day brings news about the company or its competitors that is surprising to investors (and makes them value the company higher)

I think GP means that the stock is worth 113x what it was a year ago, although that seems to be off by a factor of ~10 for Tesla.

Tesla obviously is a bubble. It's hype that hasn't delivered in its promises, and certainly not on its returns. But the fact that the company itself isn't worth much doesn't mean you can't make money from it in the stock market.

> If they keep growing at 30-50% for the next 5 to 10 years

A significant part of their revenue is selling regulatory credits to traditional manufacturers. In essence, buying a Tesla subsidizes someone else's purchase of an Escalade.

If Tesla continues to grow they will be taking market share away from traditional manufacturers, who will thus need fewer regulatory credits. So at some point each additional sale of a Tesla will result in no net gain in profit. Tesla will have to grow well beyond that point for additional sales to equal additional profit.

Unless you think that consumers have the money and desire to purchase an Escalade and a Tesla at the same time.

Here's the "model" that justifies a price target of $600: Vols x Price - Costs - Taxes = Net Income

Net income is traditionally defined as Revenue - Expenses.

From what I can tell, the Twitter formula is deriving net income from the market price of the stock, which is flawed.

"This model is bad"

"If it's so bad, then where's your model?"

Sometimes no model is better. Not that I don't think this article is full of it.

> If they keep growing at 30-50% for the next 5 to 10 years, they'll grow into a valuation that might seem excessive today

Well, I mean, you could say this of practically any growing business. But that _very, very_ rarely actually happens.

Seems particularly dubious in this case; most of the Tesla bull numerology seems to take as an article of faith that both demand for cars will grow quite dramatically over the next decade, and (even more dubious) that the ASP for cars will grow dramatically over the next decade.

I agree. That doesn't mention the actual product milestones and accomplishments either...

- 10-year lead on the EV market

- Undisputed best product in the EV market (not the cheapest).

- Proprietary charging stations rolled out globally that'd take years (even a decade?) for anyone to catch up with.

- Hands down best autonomous driving system

- Diversified into solar, upcoming diesel.

The audience of Tesla fans is, not my cup of tea. But I can't help but draw some parallels to the $30-40/share Apple days when it started growing and there were similar arguments against it. But in my head I thought, well, have you actually used the laptops? There was nothing close to them.

> best product in the EV market

People repeatedly report quality issues with Teslas. Not some minor stuff but stuff like rain getting inside.

> best autonomous driving system

I'd put a big question mark next to this one, because they don't use LIDAR. It's laudable that they want to build camera-only autonomous driving systems, because that makes them more affordable, but this has a cost in quality/performance.

re: product. Yea. Known issues with trim, body alignment, etc. Where it really counts tho, drivetrain, range, a computer system that feels a hundred years ahead of any other car tho.

re: auto-pilot. My recent car purchase was almost solely on picking the best autopilot. Current day, short of the Super Cruise nothing compares. I read a lot of "it doesn't actually drive itself" but as of the last few months it literally goes onramp to offramp, handling all the merges and lane changes with zero intervention reliably. It's remarkable. I don't expect anyone is close to complex traffic signals and urban driving regardless of platform.

I own a model S. Yours changes lanes without you telling it to? Yours exits the freeway without you telling it to?

Lane change can be configured to happen automatically with FSD in autopilot, I prefer the stick confirmation though.

Yes. Enters and exits freeway without intervention or confirmation. On a recent road trip there were several times where it exited one freeway, circled around, and merged onto another without any intervention at all.

Yea, I don't know where the idea that Tesla is the "Best EV" comes from. Hype? Tesla has no where near the quality or standards of other car manufacturers. That makes sense because they are so new.

The best EV thing comes from the fact that they are best in drive train, efficiency and battery tech.

They don't necessarily build the best cars.

As a tesla owner I'd say they are better bult than most American cars, on par with German but behind the Japanese.

Five years ago I would have agreed that they don't have quality cars (even though they were still the best EV). I was refusing to go near them for several years after test driving a "classic" model S with rattles and squeaks and all that, but at least in my own car (2019, model X "raven") these kind of things are non-existent.

Edit: On topic, I also think that the stock is crazy high.

What do you think about the problems some are having with panels coming off?

Yea the stock is insane, it'll be interesting to see where it goes.

I have yet to see any panels come off or heard of any with such issues in real life, I think that must be a very tiny minority if so.

Where I work (in Norway) about 10% of the employees have teslas and there are not more issues than most fossils except for the Toyotas perhaps :)

best autonomous driving system... on the market today. Nothing's shipping with LIDAR.

> 10-year lead on the EV market

Their first practical car was introduced two years after the Nissan Leaf.

> Proprietary charging stations rolled out globally that'd take years (even a decade?) for anyone to catch up with.

I'm not sure how well they're doing there globally. There are about 200 fast charging locations in Ireland (mostly CCS/Chademo combo) and 1000 or so 22kW AC ones. Tesla supercharging stations? Two. (They also have a bunch of destination chargers, perhaps 20 or 30). I think they're doing worse in Ireland than in most European countries, but not THAT much worse, and of course the CCS infra in many countries is far better, too.

Anyone who says a business has a 10-year lead is lying. There is no business on earth with a 10 year lead.

Growing at 50% per year is impossible given their addressable market. They would exceed the entire current auto industry in 12 years at that rate

> The article claims that Tesla valuation is not based on fundamentals but it fails to present any fundamental model.

> If they keep growing at 30-50% for the next 5 to 10 years

What makes it a bubble is the above statement you just made which sounds reasonable but is actually absurd. I'm curious how in year 10 Tesla will grow 50%. Do you have any idea how big that number is? How will that be accomplished?

Curious, I just ran math on Tesla growth at 50% for 10 years. That means Tesla's revenue will be 1.2 trillion dollars and in year 10 it will GAIN 461 billion dollars worth of revenue growth.

For comparison's sake, in 2019 Telsa revenue grew 15% (by 3 billion dollars) to 24.5 billion.

I've listened to the bulls continuously say things Tesla can double every year for the next 10 years and so on, but there is no path there. It always involves moonshots like self-driving taxis, a new eletric grid powered by Tesla batteries ect ect. All of these are super low margin businesses with heavy competition that require heavy investment with unexpected payoff.

TSLA just had a stock split yesterday. I imagine the price target is from what the stock was pre-split. Now that price target would be $120.