Tesla is achieving something that we haven’t done since the turn of the 20th century building up a modern market rapidly. One of the most puzzling trends for Tesla opponents is the stock price rise of almost 350% over the last 12 months, and more than 30% since the start of the year, as the coronavirus outbreak has devastated global car sales.
For eg, General Motors has witnessed its shares fall by 30% since the start of 2020. Yet, due to the long-lasting success of large (and profitable) pickup trucks, the carmaker has already turned into higher than anticipated sales.
For approximately the last five years, as Tesla ‘s stock has varied wildly, plunging to $150 but pushing up to over $1,000, the discussion about what’s going on has usually been framed as a Tesla-the-tech-company vs the Tesla-the-car company.
Countless bulls contend that Tesla is, in essence, a modern Apple that deserves a Silicon Valley premium as a groundbreaking tech firm. Bears argue that Tesla is an automotive manufacturer at its heart, and will be priced accordingly someday.
I was once in the latter group but my mind has shifted in the past year and a half. I don’t think Tesla is a technology company though. Then Tesla is a flashback, but a distinctly forward-looking throwback. We can’t work out Tesla for different reasons, as what it does is symbolic of the young early 20th century businesses.
The elevated levels of customer demand that we have experienced over the last few years can now continue to find their way through new orders and sales figures for businesses.
This additional demand wave gives investors sufficient confidence in budget numbers over the next 6 quarters to keep buying the stock at record records. More importantly, it gives trust to Tesla’s leadership team that its core business is powerful enough to make riskier bets in other sectors like Tesla Semi.
Would Tesla stock really worth over $1,000? Nobody knows because the potential results are so probabilistic for the business.
Solid conclusions can be drawn that Tesla could be out of business within a few years as a result of competitive pressures and production mistakes, while equally solid statements can be made that Tesla would be a few years away from completely altering the way folks and cargo are moved.
Just one thing, right now, is clear. Tesla’s car demand is very strong and is increasing rapidly. If you plan to invest in tesla’s stock but don’t know where to start you can read the evergreen guide I have found on this page.
All in all, Tesla can be a really lucrative investment since it is a rapidly growing company in a lot of different niches. However, if you fail to understand the fundamentals and your technical analysis suck you would likely lose as a Tesla investor.
Therefore, take your time, grasp as much information as possible by reading different sources. Knowledge wins everywhere and investment is not an exception to this rule. As all investors heard at some time their lives: “The more you learn, the more you earn.”