PwnallthethingsNov 26, 2022

He's the richest man only because Telsa is a memestock.

Once people realize Tesla's value is high for the same basic reason FTX's was*, it'll normalize down to something a lot smaller.

* people put money in, and number go up; and because number go up, more people put more money in. All while paying lots of attention to the brand and the memes but without paying much attention to the fundamentals of the business

Show threadDavidNov 26, 2022
@Pwnallthethings I'm no financial analyst but yeah I think the price to earnings is still like 90x and feels like it should be a lot closer to its actual industry norm (like 10x). Or maybe even less than the norm, considering... well, everything
Show threadGeorge William HerbertNov 26, 2022

@Finagle_a_Hegel @Pwnallthethings It has industry best margins on cars now, and continues to innovate faster than competitors.

BYD seems to be next closest, with Ford showing potential. Hyundai/Kia maybe, most European brands seem deer in headlights on necessary changes.

Show threadstandev
@georgewherbert @Pwnallthethings @Finagle_a_Hegel Are the better margins enough to justify 10x the market cap of Ford on half the annual profits? I’m a little skeptical.
Nov 26, 2022 at 1:33amWeb
Show threadGeorge William HerbertNov 26, 2022
@standev @Pwnallthethings @Finagle_a_Hegel The future growth profile justifies something. Like, BYD is nothing in US or Europe now, but their relative tech leadership suggests strong eventual market position. Tesla took the luxury and performance sedan markets by storm and are moving laterally and down as production capacity scales. They’re in a race with existing majors’ electrification clue. So far they’re largely winning.
Show threadGeorge William HerbertNov 26, 2022
@standev @Pwnallthethings @Finagle_a_Hegel That said, gigacastings and structural batteries and wiring harness and vehicle electronics simplification aren’t generally patentable, and tech leads can be fickle. A lead can evaporate or invert if someone else innovates faster. And margins downmarket are much thinner, so more volume helps earnings less. So, a trend isn’t a guarantee by any means.
Show threadstandevNov 26, 2022
@georgewherbert @Pwnallthethings @Finagle_a_Hegel I don’t know enough to do anything but cede the point on technical edges. I’m still skeptical that their advantage in a niche justifies a market cap of 8-10x anyone else. Ford certainly has advantages in other highly profitable segments where Tesla has essentially no presence at all (trucks, for example).
Show threadGeorge William HerbertNov 26, 2022
@standev @Pwnallthethings @Finagle_a_Hegel yeah, Teslas SUVs are weird (but selling…) and Cybertruck still hasn’t shipped, whereas Fords Lightning and Maverick and hybrid & electric SUVs are well aligned and produceable and available now. Past performance is not guaranteed future results etc; Ford might credibly win the presumptive highly profitable Electric Truck market share battle.