Tesla's market value overtakes Ford

[Gothic]

http://www.bbc.com/news/business-39485200


Tesla's market value has overtaken that of Ford after shares in the electric car maker added more than 7%.

At the close of trading Tesla had a market value of $49bn (£38bn), compared with Ford's value of $46bn.

Tesla's shares rose on Monday after the company announced record vehicle deliveries in the first three months of the year.

The firm delivered more than 25,000 cars in the first quarter, up 70% on the same quarter last year.

While Tesla's sales are growing fast they are still a fraction of Ford's, which sold almost 6.7 million vehicles in 2016.

Tesla delivered 76,000 electric cars last year.

"Magic dust"
However, investors are excited about the growth potential of Tesla.

This year it plans to start selling a cheaper car in the US, the Model 3, which it hopes will have mass market appeal.

"Five years ago no one knew what a Tesla was. Now people want a Tesla. It has usurped BMW as an aspirational car," said Ben Kallo, energy technology analyst at Robert W Baird.

Mr Kallo said that the charisma, or what he described as the "magic dust" surrounding Tesla founder and chief executive Elon Musk, allows it to attract talented staff as well as investors.

"Tesla has more going on in those four walls than we know about," he said.

Inside Tesla's gigantic Gigafactory

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Tesla reports record car deliveries

Meanwhile, Tesla has made a huge investment in battery production, building a $5bn factory in Nevada that when fully developed will be the biggest building in the world.

Mr Musk, hopes that by operating at that kind of scale his company can innovate faster and cut the cost of batteries by 30%.

As well as supplying batteries for cars, the plant makes batteries for homes and businesses.

In what was seen as a vote on confidence in the firm, last month China's Tencent spent $1.78bn on buying a 5% stake in Tesla.

 

[ahojunk]

Tesla's market value has overtaken that of Ford after shares in the electric car maker added more than 7%.

At the close of trading Tesla had a market value of $49bn (£38bn), compared with Ford's value of $46bn.

This is good news. IMO, Tesla is the company that made electric cars "sexy". Prior to Tesla, no other company was able to make much headway in the electric car business.

Even though in 1996, GM came out with the EV1 but it was scrapped a few years later with dubious reasons. If GM had continued with electric cars, GM could have monopolised the EV market today. I think GM made a big mistake and as a result it had lost a great opportunity.

Fast forward to today. I hope Tesla will continue to do well. I look forward to the day when electric cars replaced gasoline cars. When that happens, it is good for the entire world politically, economically and environmentally.

 

[Hamartia Antidote]

At the close of trading Tesla had a market value of $49bn (£38bn), compared with Ford's value of $46bn.

$55bn+ now
https://www.forbes.com/sites/chuckj...k-from-hitting-an-all-time-high/#30bd17a56415

Even Elon Musk Can't Keep Tesla's Stock From Hitting An All-Time High

Most CEO’s take the position that their company’s stock price is too low. They inevitably talk about how large the company’s markets are and how the company will continue to grow. Elon Musk is the exception to the rule since he has mentioned multiple times over the past few years that Tesla’s market cap is too high (but he does tout how large the opportunity is and that the company could one day be valued as much as Apple).

Elon Musk, CEO of Tesla Motors Inc., introduces the Model X car. AP Photo/Marcio Jose Sanchez

On May 18 the Guardian newspaper published an interview with Musk where he stated “I do believe this market cap is higher than we have any right to deserve.” The shares were trading around $310 at the time, which was an increase of 45% from the start of the year.

Since the article was published just under two weeks ago the stock has made multiple all-time highs. It is now trading around $341, which is about a 60% increase from the beginning of the year.

Tesla’s market cap of $55 billion is comfortably ahead of Ford’s at $43 billion and GM’s at $50 billion even though as Musk pointed out that it “produces just 1% of GM’s total output”.

Tesla’s stock is essentially a momentum play as its market cap has further disconnected from any underlying fundamentals as its earnings outlook has deteriorated over the past few months. The shares are up 60% since the beginning of the year while nothing much has changed in its business outlook.

Musk’s stock outlook has been pretty poor

In August 2013 and September 2014 Musk mentioned that Tesla’s shares are being overvalued. The 2013 comment was after the stock had a huge run from $40 to $140 in about four months and the 2014 statement was when the shares were about $250. The stock did trade fairly sideways for the next two and a half years until its recent breakout (see chart below). Keep in mind that Musk’s market cap statements have actually been pretty poor indicators of future performance (to the benefit of the shareholders).

Short interest is stable

The short interest in the stock has essentially not changed for over two months at least per the data as of May 15. While the actual short sellers may have turned over the number of shorted shares has remained between 31.0 to 31.7 million from February 28 to May 15. The latest run-up is probably partially due to a short squeeze it doesn’t look like it is responsible for a large portion of the increase earlier this year.

Source: StockCharts.com