Tesla stock

[J Galt]

Is there anyone knowledgeable about stocks?

I don't know the difference between price-to-earning and price-to-book ratios. I do know that Elon Musk is a guy that is putting everything into his companies. I also know that he has succeeded despite what the "experts" predicted (in multiple companies) and he continues to succeed (in multiple companies).

I'm looking for an opinion on Tesla stock. Is it a good buy for a long term hold?

 

[MrSmitty]

Dang.. I was mislead. I thought Elon was making rifle stocks.........

 

[Frosty]

I don’t have much stock knowledge but a coworker has been buying up the tesla stock, he said his plan is to hold onto a portion until summer and keep the other portion long term.

 

[63PGP]

P/E Ratio Definition: Price-to-Earnings Ratio Formula and Examples

The price-to-earnings (P/E) ratio measures a company's current share price relative to its per-share earnings.

www.investopedia.com

Price-to-Book (PB) Ratio: Meaning, Formula, and Example

The price-to-book (P/B) ratio evaluates a firm's market value relative to its book value.

www.investopedia.com

 

[J Galt]

Dang.. I was mislead. I thought Elon was making rifle stocks.........

If he is, I'll take 3.

 

[J Galt]

P/E Ratio Definition: Price-to-Earnings Ratio Formula and Examples

The price-to-earnings (P/E) ratio measures a company's current share price relative to its per-share earnings.

www.investopedia.com

Price-to-Book (PB) Ratio: Meaning, Formula, and Example

The price-to-book (P/B) ratio evaluates a firm's market value relative to its book value.

www.investopedia.com

I was just using that as an example of the lack of knowledge I have about stocks, but thanks for the info!

 

[1nderbeard]

depends on what your measure of success is. I don't believe his companies make much money; the price is kind of like Amazon. It's driven by the public perception of value.
Be careful investing on a company you can't figure out why/how it makes money. Investing is about making money, not about intrinsic value.
And 100% of people that tell you about their strategy drastically inflate their success.
PE Ratio of Tesla is 40-50. The market average is about 20.
The higher the P/E, the higher the stock price is in multiples of the earnings per share. In other words, the higher the P/E the less the stock price is tied to actual company profit.

 

[63PGP]

I spent a couple years studying this crap years ago. After that I decided to run with funds on Vangaurd.

 

[J Galt]

depends on what your measure of success is. I don't believe his companies make much money; the price is kind of like Amazon. It's driven by the public perception of value.
Be careful investing on a company you can't figure out why/how it makes money. Investing is about making money, not about intrinsic value.
And 100% of people that tell you about their strategy drastically inflate their success.
PE Ratio of Tesla is 40-50. The market average is about 20.
The higher the P/E, the higher the stock price is in multiples of the earnings per share. In other words, the higher the P/E the less the stock price is tied to actual company profit.

This may be a stupid question, but doesn't their earnings report show that they are profitable? I believe their earning have been (overall) on the rise since they started.

Earnings (adjusted): $1.19 vs $1.13 per share expected, per Refinitiv
Revenue: $24.32 billion vs $24.16 billion expected, per Refinitiv

 

[J Galt]

I spent a couple years studying this crap years ago. After that I decided to run with funds on Vangaurd.

I started to look into the technical details of the different markets. Then it occurred to me that if it were possible to choose stocks that consistently produced growth in the stock price there would be more millionaires. Then I heard about this test: https://www.forbes.com/sites/rickferri/2012/12/20/any-monkey-can-beat-the-market/?sh=48e8670a630a

A literal monkey beat "professionals".

 

[1nderbeard]

This may be a stupid question, but doesn't their earnings report show that they are profitable? I believe their earning have been (overall) on the rise since they started.

Earnings (adjusted): $1.19 vs $1.13 per share expected, per Refinitiv
Revenue: $24.32 billion vs $24.16 billion expected, per Refinitiv

Profitable, yes. Profitable enough to drive the stock price? The high P/E ratio is just one factor that seems to suggest they aren't as profitable as their stock price would indicate. Remember how high gamestop got on the perception of value? The same idea. It's valuable because people think it is, not because it's making money. If you're OK with the risk of tomorrow people thinking Elon is too conservative and deciding his stock isn't worth holding, go for it.
Personally, I think there are better investment options. Any time you're investing in the stock market you should look to minimize systematic risk (the risk that one stock will tank). You can always count on market risk (the risk that the stock market will go down as a whole.
For the same reasons I never invested in bitcoin, and think it's a foolish investment. It's worth something only because people think it's worth something. It has no inherent value, and tomorrow it may be worth nothing.
Not a financial advisor, so this isn't official advice. Just a CPA with a minor in finance.

 

[J Galt]

Profitable, yes. Profitable enough to drive the stock price? The high P/E ratio is just one factor that seems to suggest they aren't as profitable as their stock price would indicate. Remember how high gamestop got on the perception of value? The same idea. It's valuable because people think it is, not because it's making money. If you're OK with the risk of tomorrow people thinking Elon is too conservative and deciding his stock isn't worth holding, go for it.
Personally, I think there are better investment options. Any time you're investing in the stock market you should look to minimize systematic risk (the risk that one stock will tank). You can always count on market risk (the risk that the stock market will go down as a whole.
For the same reasons I never invested in bitcoin, and think it's a foolish investment. It's worth something only because people think it's worth something. It has no inherent value, and tomorrow it may be worth nothing.
Not a financial advisor, so this isn't official advice. Just a CPA with a minor in finance.

So you're saying sell everything, cash out retirements, and buy Tesla. I'm on it.

Seriously though, don't tech stocks typically have a higher PE ratio compared to car companies?

 

[ancjr]

You can look around you and see GM, Ford, Toyota and get a reasonable idea of market share. Now explain to me how you don't see as many Teslas as the other brands on the road, yet they are the largest valued automaker, larger than the next 3 brands (Toyota, GM, Ford) combined?

 

[J Galt]

You can look around you and see GM, Ford, Toyota and get a reasonable idea of market share. Now explain to me how you don't see as many Teslas as the other brands on the road, yet they are the largest valued automaker, larger than the next 3 brands (Toyota, GM, Ford) combined?

The explanation is that any one person who isn't looking for a specific car brand, and thinking about it retrospectively, is not a representative count of the number of cars out there. Strangely, since I have been thinking about the stock, I am noticing more Teslas. Still, I'm just one person and wouldn't use my observations to determine percent of Teslas on the road.

I believe they are more than an auto maker. Tesla is also involved in insurance, energy storage (batteries, power wall, etc.), AI, data collection, solar panels, and probably others I am not thinking about.

Comparing them to other car companies doesn't seem to be a good comparison. They seem more like a tech company that happens to make cars.

 

[ancjr]

The explanation is that any one person who isn't looking for a specific car brand, and thinking about it retrospectively, is not a representative count of the number of cars out there. Strangely, since I have been thinking about the stock, I am noticing more Teslas. Still, I'm just one person and wouldn't use my observations to determine percent of Teslas on the road.

I believe they are more than an auto maker. Tesla is also involved in insurance, energy storage (batteries, power wall, etc.), AI, data collection, solar panels, and probably others I am not thinking about.

Comparing them to other car companies doesn't seem to be a good comparison. They seem more like a tech company that happens to make cars.

All very good reasons for me to avoid it.

 

[J Galt]

All very good reasons for me to avoid it.

I don't think anyone is trying to talk you into it. Did I miss a post?

 

[ancjr]

I don't think anyone is trying to talk you into it. Did I miss a post?

I'm still not interested. Goodnight!

 

[BehindBlueI's]

I'm looking for an opinion on Tesla stock. Is it a good buy for a long term hold?

I think it's more of a speculative stock, and the question is will they develop breakthrough battery technology? It's not *just* a car company. They are a tax scheme company, a battery company, a solar company, and also a car company. Years ago I suggested the cars are just a way to fund battery tech and I haven't changed my opinion.

They make roughly 1.7 Billion dollars selling carbon credits to other car manufacturers. That's roughly 10% of their net income. Do you think that will continue to be a revenue stream long term?

If you're buying it as a tech company, do you think the battery tech will become something they become a market leader on? Self driving tech they can license to others? Self driving has largely been a money sink to date.

When I buy individual stocks, it's almost always dividend payers. Lessens the risk, helps ease the ups and downs, and passive income when I retire before terribly long.

 

[J Galt]

I'm still not interested. Goodnight!

I have to confess. I'm very confused by this conversation. It's like a Seinfeld skit.

Goodnight.

 

[J Galt]

I think it's more of a speculative stock, and the question is will they develop breakthrough battery technology? It's not *just* a car company. They are a tax scheme company, a battery company, a solar company, and also a car company. Years ago I suggested the cars are just a way to fund battery tech and I haven't changed my opinion.

They make roughly 1.7 Billion dollars selling carbon credits to other car manufacturers. That's roughly 10% of their net income. Do you think that will continue to be a revenue stream long term?

If you're buying it as a tech company, do you think the battery tech will become something they become a market leader on? Self driving tech they can license to others? Self driving has largely been a money sink to date.

When I buy individual stocks, it's almost always dividend payers. Lessens the risk, helps ease the ups and downs, and passive income when I retire before terribly long.

Legit points. Some are the same points I raised as positive.

I've actually got Investments in dividend paying etfs.

Tesla caught my eye partially because of all the negative press against Elon Musk in the corporate media. To me, that indicated he must be doing something right. The more I look, the more I like. They will probably never pay dividends. However, they have potential to split years in the future.