Tesla announced earnings and investors marked down their shares back to the $150 level yesterday. If TWTR (Twitter) wasn't catching all of the headlines with its dramatic IPO set to trade today, the market might have given much more attention to TSLA. Given all of the challenges that TSLA is facing, they still appear to be growing very aggressively and if they reach their growth targets, they will be consuming all of the current global production of batteries.
So, if Twitter is worth $18 billion at $26/share, I don't see any reason why Tesla can't be worth the same or more. TSLA, oddly enough, is also valued at $18 as of last night's close.
I believe it takes time to acclimate to these very high valuations. Investors and traders pushed up TSLA to extremely high valuations and now it is back down to a valuation that is closer to what you might expect for such a transformational, innovative company. I believe buying TSLA when it is deeply oversold on fears and bad news makes the most sense.
For hands-off traders: Take a look at the $100 strike puts I mentioned in the 9/17/2013 post and see if writing contracts to purchase TSLA at a $10 billion valuation makes sense to you. If you can earn a decent return for agreeing to buy TSLA at $100/sh for a fixed period of time, then consider it and look at the risk/reward payoff and see if it makes sense to you too.
Cheers, Tim 8:36AM EST, Thursday, November 7, 2013
So, if Twitter is worth $18 billion at $26/share, I don't see any reason why Tesla can't be worth the same or more. TSLA, oddly enough, is also valued at $18 as of last night's close.
I believe it takes time to acclimate to these very high valuations. Investors and traders pushed up TSLA to extremely high valuations and now it is back down to a valuation that is closer to what you might expect for such a transformational, innovative company. I believe buying TSLA when it is deeply oversold on fears and bad news makes the most sense.
For hands-off traders: Take a look at the $100 strike puts I mentioned in the 9/17/2013 post and see if writing contracts to purchase TSLA at a $10 billion valuation makes sense to you. If you can earn a decent return for agreeing to buy TSLA at $100/sh for a fixed period of time, then consider it and look at the risk/reward payoff and see if it makes sense to you too.
Cheers, Tim 8:36AM EST, Thursday, November 7, 2013
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