Tesla shares on Tuesday, February 4, soared above $ 900 and set an absolute historical record of $ 965 per share. Shares following the results of 2019 went up by 25.7%, but since the beginning of 2020, they jumped by 127% – that is, more than doubled in just a month of trading.
At the end of 2018, the company’s capitalization was $ 57 billion. On the last trading day of December 2019, the indicator was at the level of $ 75.4 billion. On January 8, Tesla capitalization outperformed the capitalization of Ford and General Motors, and a couple of weeks later rose above $ 100 billion and overtook the capitalization the second at that time automaker in the world of Volkswagen. On February 4, Tesla’s capitalization reached 167 billion, and now among all automakers on the planet, only Toyota has a capitalization of $ 230 billion ($ 200 billion in shares outstanding).
Last year, Tesla produced a total of slightly less than 368 thousand cars. This, obviously, is a worthy result for a company whose first car for the mass market left the assembly line in 2017. At the same time, in 2018 Volkswagen updated its own record – 10.83 million cars.
The company’s financial performance in 2019 has undoubtedly improved. But is it enough to justify the observed growth rate? In the third quarter, Tesla gained net profit, in the 4th quarter it was less than the previous indicator ($ 95.5 million compared to $ 159.6 million). Revenues in the last quarterly quarter of last year grew on a quarterly basis by only 2.2% to $ 7.4 billion.
By multiples, stocks are sky-high. Tesla has an EV / EBITDA of 85.15 (2.21 for Volkswagen, 9.24 for Toyota), P / B – 25.2 (0.8 for VW, 1.08 for Toyota), P / S – 6.77 (0.34 for VW, 0.7 for Toyota).
At a current price of $ 943 per share, the Wall Street consensus forecast implies a 12-month target at $ 467 per share. 8 analysts in the moment recommend buying a stock, 11 hold and 18 sell.
On Friday, ARK Invesment Management analysts forecast Tesla to rise to $ 7,000 per share. If this forecast is realized, Tesla will not only overtake Toyota by 5 times in terms of capitalization, but will also get ahead of Microsoft and Apple.
At the same time, on December 31, 2019, ARK Invesment Management sold almost 451 thousand shares of Tesla, according to statistics in the Bloomberg terminal. The company’s portfolio still has a share of 0.4% of the outstanding shares. Perhaps they were forced to do so, despite the fact that they prophesied Tesla the status of one of the most valuable companies in the world.
On this topic:
WSJ: stocks rise faster than corporate profit, but investors don’t care
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