You can’t. Get over it. There are just too many uncertainties and unknowns to assign any sort of proper valuation or intrinsic value to Tesla. There is no doubt that the company has a superb and market leading product, but that in itself doesn’t mean anything. While the company has the potential to dominate the industry over the next 10..20..50…years it can also falter away and die. This is a no way to invest if you are interested in making money on Tesla.
On top of that, Tesla is severely overpriced. Just to give an indication, it is selling at 12X Revenue Vs Apple (another high flyer) selling at just 2.7X its revenue. The bottom line is, no one really knows what Tesla’s real value is. If you would like to make money on the stock you have to look at the charts. With an upcoming bear market of 2014-2017, a severe recession, overvaluation and it’s technical setup I believe Tesla will see $50/share before it sees $250 again (if ever). In fact, we follow the stock and have a position in it in our Subscriber section if you need more information.
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The Secret Behind Valuing Tesla (TSLA) Google
Talking Numbers: The problem with Tesla? No one knows how to value it
Its cars inspire envy in auto enthusiasts all over the world. But recently, Tesla Motors’ stock performance has elicited a different emotion: despair.
That’s because the company’s stock price has fallen nearly 30 percent since hitting its February high. The move has come on relatively little news, which is not that surprising given the confusion among the analyst community about exactly how to value electric automaker
Of the 16 analysts that cover the stock, five have a positive rating, eight list it as a “hold,” and three have it as either an “underweight” or a “sell,” according to Factset,
“There is no strong consensus here, and that contributes to its volatility,” said Andy Busch, editor of the Busch Update and a CNBC contributor. “Is it an auto company or a technology company? All we really know is that it’s the poster child for momentum,” Busch added.
With few fundamentals to rely on, many traders have turned to the charts for help. But unfortunately, they aren’t looking much better, at least according to some technicians.
“I don’t like it when we see a stock up 550 percent in 18 months,” said Rich Ross, chief market technician of Auerbach Grayson and a “Talking Numbers” contributor. “Go back longer term, we can see Tesla’s in real danger of pulling back to the 50-day moving average. That brings you to about $150 per share. I would not be surprised if we touch that level.”
Whatever’s driving Tesla, traders says the stock’s next move is likely to be determined by whatever the market does, and that could mean little relief for investors.
“We are due for a larger selloff in the broader market,” said Enis Tanner of riskreversal.com. “If that’s the case, Tesla still likely has more selling ahead of it.”