Quote:
Originally Posted by GordonBlue
wonder at what point investors are going to wait before they see Tesla stock as a good buy.
I glanced at an article the other day that suggested waiting until it's down to $150 and then getting in. (this was when the stock was at about $170)
As a person who knows nothing about the markets, I'm guessing it's probably safe to wait longer as it should just keep going down.
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Quote:
Originally Posted by Fuzz
https://www.benzinga.com/quote/TSLA/...nga%20Insights
Here are some analyst targets, most seeing lots of upside. The problem is, Tesla stock behaves pretty irrationally due to cult-like status. The best move Tesla could make now would be to ditch Musk and provide some stability. Keeping him around? Who knows where it goes, depending what he does. I'd definitely sit on the sidelines on this one until it finds a floor, maybe around $140. If it bust through that level...
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TSLA earns $3.62 per share. Auto stocks typically have P/Es of 6 - 8 X earnings. TSLA's is 48 X earnings. The question is why?
Tesla has been priced as a tech company (high P/E) and not an auto company, from the beginning. But should it be? Should it be, going forward, now that it is an auto company, nothing more, nothing less, and their technological advantages are evaporating?
Do you believe that their sales and earnings will continue to grow at a rapid enough rate to justify a P/E of 48X? Or, do you think the auto industry is catching up?
If we give TSLA a P/E of 8X, that puts the price at $29. At 10X, it is $36. Hell, even if you're willing to give it a P/E of 20X, that is $72.
I fail to see any reason why you would pay more than 20X earnings for it. IMO, the right number is more like 10X. I think it is a $30-40 stock.
Can it have a pop from here? Sure. Maybe it jumps from $150 to $180 when it finds some support. But I think the overall downtrend continues, and I think it's trading at more like 10X, a year or two from now. Maybe 20X