Tesla Valuation Part II

Back in April 2022 I posted about Tesla’s Valuation as modeled by Cathy Wood’s ARK EFT. At that time TSLA was trading around $330+ per share. My recommendation as an arm chair analyst was to stay well clear of the stock as it was incredibly overvalued. Today it’s trading about half that, $170+ per share.

So I decided to check out ARK’s latest open source Tesla valuation to see what they are saying. ARK’s expected value for 2027 Tesla stock is, drum roll:

$2,000 per share or 1400+% growth in the next 3 years. It’s worth noting that that is less than half their prior estimate when I did my original post ($4,600 per share).

Musk’s latest ridiculous announcements include the launch of, or carnival barker announcement of, Robot-taxi’s on 8/8 (get it? 8/8 is a known reference to the eighth letter of the alphabet or H. HH. Heil Hitler). He’s so funny for a white supremacist. While Full Self Driving (FSD) may be better than ever (I have a Musk fanboy friend who swears by it) you can’t overcome peoples reluctance around the technology easily, and you can’t overcome the regulatory barriers to Robo-taxi’s in anything like a year or two.

He’s also saying that Tesla can use your vehicle’s compute capability when you are not driving to offer AWS type services, or maybe mining dogecoin, who knows. I read this as nothing more than an attempt to pick up some AI tailwinds.

My hypothesis is that Tesla has a lot more trouble ahead. Luxury automakers are now building much better high end cars than the aging model S, X and Y. At the bottom end the Chinese and other lower cost manufacturers will be highly competitive. When combined with Musk’s awful leadership - which the world now mostly knows given what he has done at Twitter and the Cybertruck boondoggle, my simplistic investment advice is the same. Stay well clear of this company.

I would however like to invest in whatever the hell they are smoking over at ARK.