yes, but the question remains, what's more dissimilar TSLA / GM or $1.25M / $9K?
If we assume Tesla will grow units sold while GM will remain about static AND we assume GM is fairly valued (while assuming unit margins are the same for both companies), then it tells us Tesla needs to sell about 140 times as many cars per year in the future to justify its current stock price. Now, if you assume Tesla’s cars will have a margin 4x as large as GM’s and that GM’s business is undervalued by half, then if my math is correct, Tesla needs to sell only 17 times as many cars per year ($1.25MM/4=$312k, $9k*2=$18k, $312k/$18k=17). That 17x increase doesn’t seem totally unreasonable.
Of course, this also assumes that Tesla will make its money off of cars sold and not some other wild Muskian idea: if he develops world-beating self-driving software selling at 90% gross margins or wisely acquires other companies like Henry Singleton did at Teledyne, we could all be saying a $5 trillion market cap is cheap for Tesla in a few years! That said, as an investor, I wouldn’t buy today’s Tesla at even half its current stock price nor would I bet against Elon Musk (especially by shorting!). A lot of things have to go right for Tesla to justify its stock price; I just don’t have any way of predicting what Musk will do next!
- seats - selling - soon batteries - ai chip - soon insurance - charge stations is like if GM could own the gas stations
This doesn’t even count the growth of the other product lines like utility grid storage and solar roof and Uber like services.
Big deal, they barely produce any cars.
If Musk threatened to go to jail because a governor did not let him keep his plant open through COVID, he will be eviscerated by some UAW guy and will outsource the entire production ASAP.
Yes, 1 million robotaxis by the end of 2020.
https://www.thedrive.com/news/38129/elon-musk-promised-1-mil...
But I still think there's a limit to what any one company can do. The insurance company Allstate could be worth $1T if they end up entering a business producing revolutionary proprietary alternative fuel technology! Obviously, I think Tesla with Musk at the helm has a better chance of creating new markets than GM, Allstate, Exxon, etc., but I realize that there's some limit to what one company can do.
Once your company's market cap gets in the trillion-dollar category, and the total market cap of the US stock market is 50 trillion, you shouldn't expect a 100-bagger.