Tesla Stock on its Way to $500 Per Share?


Could Tesla Motors’ stock actually be under priced?

Tesla Secrets Lie Underneath - Or Maybe That's Just a Covered Model S

Tesla Secrets Lie Underneath – Or Maybe That’s Just a Covered Model S

At one point in time, shares of TSLA were going for nearly $200.  Right now, TSLA is at ~ $150 (real time quote can be found here), but is $500 per share possible?

Seeking Alpha makes the case for TSLA to hit $500 in the distant future.

*Let it be known that Seeking Alpha is a financial site.  InsideEVs is not.  As such, we don’t provide financial advice.

These words comes straight from Seeking Alpha:

“The thought will probably provoke laughter. A well-known stock like Tesla (TSLA), up already over 400% this year, still has another 1,000% to go compared to its December 31, 2012 close. No question that Tesla currently trades at nosebleed valuation levels using any historic ratio you can dream up and compare them to long-established car companies such as General Motors (GM) and Ford (F). So how on this green Earth can I sit here and tell you $500 per share may very well be in the cards?”

“The answer is using simple math and clues from Tesla’s conference call.”

Basically, Seeking Alpha goes on to present the case that demand is there for Tesla vehicles and that production will go to 40,000 units in 2014 at minimum.  From there, the production target shoots up yearly until reaching 500,000 units per year at some point in the distant future.  If Tesla actually hits that half-million-unit mark, then the $500 per share valuation comes into play.  Oh, Gen 3 (aka Tesla Model E) must come to market priced in the mid-$30,000 region and it needs to launch on schedule (by 2017).  If all that’s achieved, then Seeking Alpha says TSLA will be on its way to $500 per.

Source: Seeking Alpha

Categories: Tesla

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5 Comments on "Tesla Stock on its Way to $500 Per Share?"

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Seeking Alpha publishes articles on Tesla every day as it is the hottest stock on the market. Apple is so yesterday’s stock. Most of them think that Tesla is grossly overvalued so that you should short any Tesla stocks and some of them thinks that you should hold your position on long term. Very few articles — like this — advices that Tesla is actually worthy to buy, because buying Tesla at these rates is gambling that BMW, Audi and Mercedes will fail at EV markets.

Anyway, the main problem is that Tesla cannot ramp up production fast enough due to crushing supply problems of batteries. I would say that only way out is to build Tesla’s own Gigafactory. I.e. factory with annual capacity over one billion cells.

Seeking alpha is practically a public blog site where almost anyone can post questionable random musings. Completely depends in who wrote it.

That said, I could argue that tesla is undervalued. If you beleive as elon does, that electric vehicles will replace gas vehicles at some point in the future, the question becomes who and when, not if.

The traditional companies have shown a remarkable resistance to embracing EVs. The i3 is destined to fail spectacularly like many iPhone killers. Nissan is best positioned. Everyone else is just trying to stop or stall it.

If you beleive that tesla has unique technical ability due to their technology focus and green field approach, then tesla has a high likely hood of becoming the worlds biggest auto maker years down the road. If that’s true, then it’s valuation today will seem like a tremendous bargain.

Best time to invest is when you see a conclusion as inevitable while the general thinking is that it will fail.

“The i3 is destined to fail spectacularly …..”
BMW I3 -8000 pre oders only in Europe in september!

Easy to preorder a new car from a reputable manufacterer. The i3 is assumed to be great. But no one has one yet.
It’s like the various blackberry iphone killers. Certainly it will be so great to destroy the iPhone.
Once people can actually drive the i3 it won’t do so well and folks will be surprised like it’s some new revelation.
It’s a tiny car, doesn’t do great on the highway, with a small very limited range extender. Very little trunk space.
People had also said the Spark EV was going to take over the world. How is that working out?

When analysts shout dausend, it’s time to sell.