Tesla revenues grow 81% from last year
cnbc.com
cnbc.com
Not quite as fantastic as I initially thought, because of a surprising rebound on regulatory credits. Once you exclude that its not quite a amazing, still really good results on all the most relevant metrics.
That said, apparently there was some change in regulation that lead to the regulatory credit going up, so maybe that will continue.
A few neat points, Tesla has now basically retired all debt. They are practically debt free now. This is huge contrast to other automakers.
Tesla insurance seems to be finally really ramping and Tesla will be fully vertically integrated into both insurance and repair.
First deliveries (we think) of Tesla new in-house cells. This is really a major deal. A much bigger deal then most people understand. For a company that only in 2018 started to be taken seriously, to actually making its own battery cells with a completely new and unique battery production line is quite insane. Tesla will shortly be the biggest US cell manufacture and within a few years they will be one of the largest battery manufactures in the world.
Two huge new factories open up in Q1. Tesla on track to start outproducing major household names of the global auto industry in 2023.
Unfortunately not great for the energy business. Solar hit hard by supply chain. Battery as well but to a lesser degree. Next quarter will likely be good for battery because a major project will be recolonized.
Of course the share price is always future looking, so any past results are always already predicted.
What matter is the result of this Q matches the trend that you expect.
As for it being overvalued, people have been saying that since the IPO. And if you look at share price 2-3 years ago it is justifyable if you look at the price now.
So it all depends on your future growth assumtions.
"Tesla's market share is at risk of plunging: analyst" (Feb 2022): https://finance.yahoo.com/news/teslas-market-share-is-at-ris...
"...We expect Tesla's market share to drop from about 70% in EVs to about 20% in the next three years. They [Ford and General Motors] are gaining the bulk of the market share we expect Tesla to lose..."
"Tesla Is Losing Market Share In Every Major Car Market" (March 2021): https://seekingalpha.com/article/4411931-tesla-is-losing-mar...
"Tesla's Market Share Takes a Dent" (Jan 2022): https://www.statista.com/chart/26539/worldwide-bev-sales-bet...
"Electric cars are more popular than ever, but Tesla is losing market share to new competitors" (Oct 2021): https://www.businessinsider.com/tesla-market-share-drops-for...
But most people haven't so these make for some good headlines.
The EV market is not what matters, because eventually the EV market will just be the car market. And that is the global technology transition happening right now. Its like this, would you rather have a 70% of a cookie or 20% of gigantic cake?
You are free to make different projections about future revenue and margin growth then I do. But please don't pretend you have some objective knowledge about stock prices being to high or to low.
But honestly, it doesn't seem like you have given the matter much thought.
I mean, using 'seekingalpha' as a source, you know your scraping the bottom of the barrel. Its almost a cry for help. Go back 10 years and look what their supposed Tesla insights back then were worth.
When something starts to look like a religion its difficult to use some objective analysis of stock price. But to even justify the current valuation, and for it to make sense, in 6 to 7 years from now, 1 in 3 of the 70 million vehicles sold annually worldwide would have to be a Tesla.
Tesla valuation is the total of all other manufacturers combined, and simply a product of the biggest FED induced market bubble in history: https://www.5yearcharts.com/nasdaq-5-years-charts-of-perform...
Tesla shares were at 88 USD in Jan 2020 and are now in 2022 at 1000 USD, so two years later. What technological or dramatic market share breakthroughs, justify 1036 % increase in two years?
And are even analysts justifying this insanity...A bit more sanity in the links below:
"Tesla Stock Is Overvalued by $1 Trillion, Analyst Says. We Looked at the Math."(2021): https://www.barrons.com/articles/tesla-stock-overvalued-1-tr...
"Tesla Has To Sell More Cars Than Is Theoretically Possible" (2020): https://www.forbes.com/sites/danrunkevicius/2020/10/08/will-...
Ah that's why the history of Tesla is so free criticism. The universal positivism about Tesla for the last decade really proved that people are afraid to be critical about Musk.
You are joking with that argument right?
> Tesla shares were at 88 USD in Jan 2020 and are now in 2022 at 1000 USD, so two years later. What technological or dramatic market share breakthroughs, justify 1036 % increase in two years?
Its amazing what one can do when selecting a time period to fit the argument one wants to make.
Tesla stock was not growing well since the IPO, it was flat for years before the big spike. There were massive fears that Tesla would go bust and people still didn't believe the transition to EV would happen at all.
The very analyst that you hilariously accuse of being afraid of Musk and the fanbois were basically burring Tesla in 2017.
However by the beginning of 2020 Tesla proved that totally wrong and anybody who seriously looked at the financial and Tesla execution had seriously undervalued Tesla. There was a massive correction that was justified by how much Tesla had been undervalued. The pandemic suppressed for a while after that.
But during the pandemic, when other car makers had billions in loses, Tesla didn't have single quarter of not making a profit. Showing that they were at a point where a economic crisis was not gone just destroy them. This removed the last big question annalists had about Tesla.
They are still growing at break-neck speed and are on track to continue that for many more years. They have high demand products just waiting for supply chain issue to lessen. I see no reason they can't continue to keep up their growth for many more years to come. They are only just now starting to unlock many of the advantages of massive manufacturing scale. They are only about to move into the Top 10 of global car makers, but within 2-3 years they will be in the Top 5 and of those Top 5 many will be mergers of currently existing car companies.
In that time Tesla interceded its own batteries (and making their own battery materials), meaning they are full fledged chemical company and they are on track to become the largest battery maker in the Western world and on of the biggest in the world. They make their own hardware and chips for both their own products and even for their server side compute. Tesla makes its own insurance and its own service. Tesla is vertically integrated to a massive degree, its not comparable to their competitors.
Their margin and profit has been improving consistently and they have retried virtually all debt. Go look at other car makers and how fast they grow and how much debt they have instead of comparing stock price. Tesla is in self funded growth mode, they are no longer in need of raising capital to invest in future growth.
> "Tesla Has To Sell More Cars Than Is Theoretically Possible" (2020)
Go look at the arguments in that article and plug in the current and predicted financial numbers. The articles own line of argument doesn't even hold up anymore. The predicted PEG for the next 12 month is now below 5 already.
If you have not moved on with your analysis since 2020 you are seriously missing out.
Electrification doesn't stop at cars, and electrification come to many industries. Tesla already does a lot of grid related things of course and that will continue to grow. There is no reason Tesla can not eventually do boats, construction equipment, airplanes if that makes sense for their growth strategy. Or they could become a parts supplier for those industries.
Musk has been wanting to do electric airplanes for 25 years now, Tesla will for sure be in that business eventually.
And that is before you even take into consideration self-driving and robotics. Even if those are highly risky bets anybody who does the analysis needs to take it into consideration.
Without side tracking the discussion too much, how is everyone so sure the rise in inflation is what it is? Wouldn’t the rise in prices be more attributable to supply shocks of the last two years? We know housing is shocked due to inventory, along with cars due to semiconductors, and general electronics (still can’t click buy-it-now on a PS5 at MSRP, still near $1k). How can this be inflation? How are they sifting supply and demand out of the equation?
Inequality has been so high for so long, that I can’t imagine even 10 trillion dollars of global money shifting the pendulum in the other direction like this. Most people didn’t put that stimulus money into assets, it should have technically vanished (aaaaaand it’s gone - South Park) into consumerism.
People just don't want to acknowledge that "compute time" has a market price far above MSRP. Especially GPU based compute time. People want to point at people they don't like "scalpers!" "crypto miners!" instead of attempting to quantify how much of the demand they are, while ignoring other areas where demand has grown where there is also a profit motive rationalizing paying a higher market price: multiple trillion dollar companies and several hundred billion dollar companies are building data centers everywhere for cloud gaming, cloud computing. This inherently requires buying all high end GPUs as fast as possible, and they're going to charge people monthly subscriptions to use them. and then there are the consumer and hobbyists and enthusiasts. It was a supply shock while demand has grown.
People just don't want to accept that they'll never get a nice GPU at 2019 prices. That they need a new hobby if thats what they use GPUs for.
Many analysts pointed out that gaming has been the most undervalued entertainment sector, because its audience is price sensitive and whiny. Well, now its less undervalued as the hardware is more expensive.
Then after that there are the inputs that have increased in the number of dollars needed to get them, a major factor there being the increase in dollars existing and how it pools into certain areas of the economy (which increased demand and scarcity of those things too.)
And data already suggests this is on the decline. So this needs to be taken in context.
Opposed to GM who runs not stop ads on CNBC touting the opportunity to just sign up in mid May to buy a Lyriq.
The only reason they didn't grow even faster this quarter was because of a suprise COVID shutdown in China.
They have opened 2 new factories in Q1 that will ramp this year.
They have also raised prices and those price races will only be reflected in future quarters because of long lead times.
> And data already suggests this is on the decline. So this needs to be taken in context.
You can't go from making a general statement about demand for auto producers and then just apply it to Tesla. Once you think about the Tesla specific context its the opposite of decline.
Absolutely none of which you’ve presented. My anecdotal “evidence” - that I know several people that have tried to buy new cars and all been quoted massive wait times - is worth more than “Tesla bros are into Teslas”.
There are supply shortages that lead to manufactures not being able to produce enough, that is why there are wait times. All manufactures are constraints, specially on EVs.
Tesla has not been demand constraint for years and pretty much ever analysis agrees on this and they all agree that Tesla will continue to be demand constraint for this and next year at least.
Tesla is clearly continuing to increase its production capacity (new factories), even within the supply constraint environment, and again all analysts agree.
So the idea that Tesla will not continue to grow this and next year at least is literally opposed to pretty much every known metric and analyst agree on that.
But I guess they are all Tesla bros or whatever.