Tesla Research

Feb 10, 2023

Sell the rumor, buy the news?

In past articles, I argued that the investment case has transitioned from ‘disruptive growth’ to ‘growth at a reasonable price’ (GARP). GARP is a very popular market segment, appreciated by investors for its predictability and because it is straight forward to value…

a month ago · 13 likes · 5 comments · Fallacy Alarm

TSLA 1Q23: 3 months nope, 3 years dope

Competition and Margin Pressure After hitting its GFC low in 2009, surged and 10xed by 2012. Introduced in 2007, the iPhone conquered the world during those formative years for the third iteration of the company that made it what it is today. But then the stock dropped 30% out of nowhere, while broader markets continued marching along. This drop had two…

a month ago · 16 likes · 4 comments · Fallacy Alarm

Quantifying the Tesla Insurance Opportunity (incl. Excel Model)

This article is part of a series where I am attempting to quantify the midterm EPS potential for Tesla. Eventually, I will build a 3-5y model with an approach that is similar to how I modelled my 2023 EPS estimate here. To develop this model, I have so far looked at…

2 months ago · 11 likes · Fallacy Alarm

What's the Value of Tesla FSD? (incl. Excel Model)

On December 17, 1903, Wilbur and Orville Wright pushed their Wright Flyer onto a field near Kitty Hawk, North Carolina. Orville got in and they launched. He landed 12 seconds and 120ft later. It was the first controlled, sustained flight of a powered, heavier-than-air aircraft. A sensation…

3 months ago · 11 likes · 1 comment · Fallacy Alarm

Fluence 1Q23 cross-read for Tesla Energy

I view the battery as one of the most important economic goods of the coming years and decades. It will enable us for the first time to store energy at large scale outside of fossil fuels. I know you can’t dig batteries out of the ground like oil, you have to manufacture them. But in principle it is a commodity just like oil. Semiconductors fall into this category as well…

4 months ago · 1 like · Fallacy Alarm

What might Tesla Finance look like? (Excel Model included)

In my latest article about updating my 2023 EPS estimate, I mentioned that there may be a near-term opportunity for to venture into Consumer Finance. The occasion for that was Adam Jonas’ question on the earnings call to which Zach Kirkhorn responded that ‘the plumbing is in place…

4 months ago · 4 likes · Fallacy Alarm

Update of my TSLA 2023 EPS Estimate based on 4Q22 Earnings (Excel Model included)

On Dec 27, 2022, I published the article below. The stock had crashed to $106 and many people called for the total collapse to way below $100. In that article, I hypothesized that chances for a quick V-shaped rebound are actually quite good. Today, one month later, the stock actually sits at $160, 50% higher. I have a much bigger V in mind, but I have not had many wins to celebrate over the past year. So I am taking the opportunity to celebrate this one…

4 months ago · 7 likes · Fallacy Alarm

What might Tesla's 2023 EPS look like? (Excel Model included)

In my last article, I have argued that Tesla’s valuation has transitioned from (unprofitable) explosive growth to GARP (Growth At Reasonable Price). This gives two metrics outsized relevance in its price discovery process: P/E and EPS. For the first time in its history, its EPS is significant enough to build an investment case based on earnings and assigning a multiple to it. You can observe this phenomenon when you compare public discourse about the stock now vs. two years ago. Very few people talked about P/E and EPS back then. Today, those metrics often take the centerstage…

5 months ago · 6 likes · 2 comments · Fallacy Alarm

What is a fair P/E ratio for Tesla?

The Relevance of P/E for Tesla For most of its history, was loss making, which made it challenging to value. Unprofitable growth companies need to be assessed differently from those that have proven their business model by achieving profitability. The essence of growth investing is to figure out a) the point in time when the company will breakeven and b…

5 months ago · 19 likes · 5 comments · Fallacy Alarm

9 Reasons why TSLA might see a V-Shaped Recovery

Merry Christmas, friends! I don’t know about you, but I am kind of limping towards the close of 2022. The reason for that is obviously my heavy exposure to which seems to be heading towards an utter implosion. It will not fall 5% a day forever though. At some point this brutal sell-off will end and it will be replaced by a new phase. Will it be a violent…

5 months ago · 7 likes · 10 comments · Fallacy Alarm

Quo vadis, Tesla?

I own stock since 2017 and this is certainly the most brutal time I can remember. It’s not just that we are now officially in the largest correction the stock has ever had. It’s also the fact that it came completely unexpected. The company does not have the problems that hammered down…

6 months ago · 6 likes · 2 comments · Fallacy Alarm

Tesla 3Q22 earnings digest

Media coverage for is enormous and I can imagine you don’t need my two cents to get a decent picture. But I just wanted to share some of my initial thoughts on those aspects that I believe are underappreciated based on the comments I am seeing out there…

7 months ago · 2 likes · 1 comment · Fallacy Alarm

Tesla 2022 AI Day Digest

Putting it into context Before you read my commentary on 2022 AI Day, I’d encourage you to check out my preview from back in June in which I outlined why I am pumped about Tesla’s move into robotics. In that article, I have presented Real World AI (RWAI) as an innovation platform that will rival previous computing revolutions such as Personal Computing, …

8 months ago · 4 likes · 5 comments · Fallacy Alarm

Where is Tesla's demand cliff?

The health of the production constraint thesis When I was young, there was a company named Wiesmann near my hometown that specialized in designing and manufacturing stunning retro style sports cars with a modern touch: The company was founded in 1988 and had a loyal fanbase for whom they hand-built 180 vehicles per year. Business went well and Wiesmann ev…

a year ago · 8 likes · 1 comment · Fallacy Alarm

How (not) to handle the Tesla Beast in the 2020s

Mental vs. analytical aspect of Investing It is not difficult to infer from my articles so far that I am a huge Tesla bull. I mention them in almost every piece I write, which is why I am actually concerned this obsession will repel some of you over time. But I hope my posts are generalized enough in nature that you can take away something useful from th…

a year ago · 6 likes · 4 comments · Fallacy Alarm

The truth about Tesla's cash flow and capex

Tesla is becoming more and more of a cash machine, which is quite remarkable given how sticky the narrative has been that they can only make money on emission credits. Two years ago, when I encouraged a friend to buy TSLA even at $960 a share ($180 post-split), he was concerned how overvalued it was and I could not blame him given the run the stock had …

a year ago · 5 likes · 1 comment · Fallacy Alarm

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