I’ll probably regret it, but I’m going to make a stock call:
Tesla will be above $420 before the end of 2019.
Tesla is undervalued and I can’t see how the market mispricing can persist much longer.
Car sales are good, and car sales are a means to sustain, but the value is in the software and data. Autonomous driving technology is wildly disruptive.
Tesla trades at 1.45x 2019 sales. That’s a conservative sales estimate.
Tesla will earn a revenue multiple more akin to Google or Microsoft, for two reasons: Tesla has the most practical, and profitable, AI application that’s positioned to drastically change the world. And, Tesla’s revenue is compounding very rapidly. 50% Yoy and I estimate ~20% for each of the next three years.
Tesla is building the most advanced autonomous driving platform, already years ahead the competition and poised to extend their lead with the data collected from Tesla’s driving each day, all around the globe. Level four autonomy is not far away, and level four autonomy will change the transportation industry.
And level five autonomy, which is far away, will change the global workforce.
I predict that in 2021 Tesla will trade at 4x 50 Billion in sales. Tesla is like Amazon in 2006, so don’t expect a lot of profit until the world is covered with Tesla cars, solar panels, and batteries.
Disclaimer: I’m long 45 shares of TSLA.