Tesla - I told you so
Posted: Tue Apr 30, 2019 2:04 pm
Sell Tesla, Buy This EV Company Instead
By Christian DeHaemer
Written Apr. 30, 2019
Elon Musk is an enigmatic billionaire at best. He is a big, bold thinker who produced some incredible technology, from flamethrowers to boring machines.
But his bread and butter, Tesla, Inc. (NASDAQ: TSLA), is failing.
The electric car tycoon warned us that he might have a bad quarter, but the market was shocked by the size of the loss.
Tesla's net loss of $4.10 per share was below the lowest estimate, a loss of $0.69 per share.
Of course, Elon made like this was just a bump in the road and that the company would be back to profitability in the second half and cash flow positive this quarter.
However, as I’ve been saying for years now, Tesla’s lead in technology has shrunk to nothing. Every car brand in the world is coming out with a luxury electric car.
Porsche has an all-electric sedan called the Taycan that is purported to run a sub-eight-minute Nurburgring lap. It is due out next year and will be priced around $75,000.
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As I pointed out in the 4-2-2019 "The View From Houston": Now the Cadillac and Porsche have announced luxury EVs, Tesla is "Dead Meet". Teslas are not within the budget of "normal people" and they don't make economic sense, so only rich people (who don't care what stuff costs or just want to impress their Environmental Wacko friends) will buy them. - Dan
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More from Christian DeHaemer
The largest electric car company in the world is in China and goes by the name BYD (OTC: BYDDF). It rises while Tesla falls.
In its latest quarter, the company’s profits rose 632% to about 750 million yuan ($111 million), compared to 102 million yuan a year ago.
BYD sold 73,172 new energy vehicles in the quarter. That was up 147% from the same period a year ago.
Including conventional fuel cars, it sold 117,578 vehicles in the quarter, up 5% from last year. BYD expects to sell 655,000 cars in 2019.
That said, BYD might not be the best way to play the increasing market share of electric cars. There is plenty of competition and thin margins.
And with a P/E of 48, it still seems overvalued. Toyota, arguably the best car company in the world, has a P/E of 7.8 and pays a 3% dividend.
One thing I do know is that China is increasing its electric grid to power all these new cars. And it's importing a lot of coal to do so. The U.S. currently exports 1.1 million mt of coal per year.
By Christian DeHaemer
Written Apr. 30, 2019
Elon Musk is an enigmatic billionaire at best. He is a big, bold thinker who produced some incredible technology, from flamethrowers to boring machines.
But his bread and butter, Tesla, Inc. (NASDAQ: TSLA), is failing.
The electric car tycoon warned us that he might have a bad quarter, but the market was shocked by the size of the loss.
Tesla's net loss of $4.10 per share was below the lowest estimate, a loss of $0.69 per share.
Of course, Elon made like this was just a bump in the road and that the company would be back to profitability in the second half and cash flow positive this quarter.
However, as I’ve been saying for years now, Tesla’s lead in technology has shrunk to nothing. Every car brand in the world is coming out with a luxury electric car.
Porsche has an all-electric sedan called the Taycan that is purported to run a sub-eight-minute Nurburgring lap. It is due out next year and will be priced around $75,000.
-------------------------
As I pointed out in the 4-2-2019 "The View From Houston": Now the Cadillac and Porsche have announced luxury EVs, Tesla is "Dead Meet". Teslas are not within the budget of "normal people" and they don't make economic sense, so only rich people (who don't care what stuff costs or just want to impress their Environmental Wacko friends) will buy them. - Dan
---------------------
More from Christian DeHaemer
The largest electric car company in the world is in China and goes by the name BYD (OTC: BYDDF). It rises while Tesla falls.
In its latest quarter, the company’s profits rose 632% to about 750 million yuan ($111 million), compared to 102 million yuan a year ago.
BYD sold 73,172 new energy vehicles in the quarter. That was up 147% from the same period a year ago.
Including conventional fuel cars, it sold 117,578 vehicles in the quarter, up 5% from last year. BYD expects to sell 655,000 cars in 2019.
That said, BYD might not be the best way to play the increasing market share of electric cars. There is plenty of competition and thin margins.
And with a P/E of 48, it still seems overvalued. Toyota, arguably the best car company in the world, has a P/E of 7.8 and pays a 3% dividend.
One thing I do know is that China is increasing its electric grid to power all these new cars. And it's importing a lot of coal to do so. The U.S. currently exports 1.1 million mt of coal per year.