Tesla: Do the Fundamental Support the Stock Price?


I have been asked to provide a FAST Graph analyze out loud video on Tesla (TLSA) from many subscribers to our YouTube channel. This is a difficult company to analyze based on fundamentals. In some sense, it is really a tale of two companies. The first story refers to the company fundamentals from the company trading as a public entity to current time. The second story refers to the potential fundamental growth of the company going forward.

Importantly, I want to stress to subscribers the reality that since May 31, 2019 Tesla stock price has more than tripled. To put that into perspective, the price has recently risen in a parabolic advance. However, it’s also important to recognize that earnings and cash flows are also expected to increase dramatically going forward.

The bottom line to me is that Tesla is certainly a very expensive stock today. On the other hand, there is very interesting future growth expectations that could make long-term shareholders a lot of money. The problem could be short to intermediate term potential risk due to the high current valuation. Consequently, I would consider Tesla a long-term speculative opportunity with the potential for significant short-term pain. This could be a classic example of my allegory where I suggest that great investors and great mountain climbers share a common understanding. Both realize that the only way to get to the highest peak is to be willing to traverse the occasional valleys in between. Caveat emptor (buyer beware).

FAST Graphs Analyze Out Loud on Tesla:

© F.A.S.T. Graphs

© F.A.S.T. Graphs

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