Tesla Inc is valued at 928 billion USD by public markets.
All financiers and people in general who have studied company valuation know that regular company valuation methods cannot explain Tesla Inc's lofty valuation.
Apparently, the market is assuming Tesla would grow with 20 % for the next 10-15 years and achieve a net profit margin of 20 %. I would put the likelihood of such favourable developments for Tesla at 1 %.
I estimate Tesla is worth 120 billion USD. This is the value of Tesla electric vehicle production technology and production know-how and expertise and the value of engineers, assembly line workers, financiers and support personnel working for Tesla.
Yes, it took the internet more than 40 years to become commercially viable. But there was not a company like Tesla valued at around 1 trillion USD equivalent in the intermittent space. Yes, shortly dot-com companies like Pets.com were valued loftily and they went bankrupt after the 1996-2001 dot-com boom and bust.
The strategy is clear, of course. Raise funds, buy time to make a technological breakthrough that will make electric cars production commercially viable or profit generating in short. Much like the Internet took decades to become commercially viable.
But still. Tesla is the largest single stock bubble in history, in my humble opinion.
And when it bursts, the ramifications will be huge and wide reaching.
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