Skip to main content
No. of Recommendations: 17
I've been delaying this post because I hate to sound like a Tesla fanboy but the story is a once in a century very much a reminder of Henry Ford a century ago.

The Tesla share price shot up much higher than the adoption "S" curve would have it, with less than 1% market penetration it went to the moon but by 2Q 2021 the GAAP P/E ratio is down to 100. TSLA is fast growing into its valuation. Elon Musk is saying that Tesla can grow at 50% year over year and I think that is sandbagging but lets use it

Market 85,000,000
Tesla delivery growth 50.00%
Year Cars Share Price CAGR

2020 500,000 0.59%
2021 750,000 0.88% 650
2022 1,125,000 1.32% 975
2023 1,687,500 1.99% 1,463
2024 2,531,250 2.98% 2,194
2025 3,796,875 4.47% 3,291
2026 5,695,313 6.70% 4,936
2027 8,542,969 10.05% 7,404
2028 12,814,453 15.08% 11,106
2029 19,221,680 22.61% 16,659
2030 28,832,520 33.92% 24,988 48.37%

2031 43,248,779 50.88% 37,482
2032 64,873,169 76.32% 56,223
2033 97,309,753 114.48% 84,335
2034 145,964,630 171.72% 126,503

Assuming that Tesla can garner a 33% market share that goal will be reached by 2030.

Net earning, market share, and share price will not grow in lockstep as shown above. One can expect contraction in the P/E ratio as the company matures but it is already down to 100. As the learning curve improves, net earnings should grow much faster that revenue. Tesla in not just a car company, what other income streams will it have?

Cars, insurance, battery charging, rooftop solar, home, industrial, and grid storage, FDS, robo-taxis. Each of these technologies or businesses has its own "S" curve.

The Superchargers are going to be made available to the whole market in effect making Tesla the leading EV service stations. Don't forget the restaurant trade mark! If Tesla FSD is so far ahead of the competition, is it not likely that it will also become the de facto FSD standard earning Tesla another revenue stream? Tesla making its own batteries and making deals to get raw materials for them, a big cost reduction initiative. BTW, iron based (lithium iron phosphate) LFP batteries are cheaper for stationary storage where weight does not matter. There are so many initiatives at Tesla that it is hard to believe that it is not the investment of the century for at least the next decade.

I think a CAGR as shown in the above table is understated but any sustainable CAGR above 15% is market beating.

Denny Schlesinger

2Q earnings report coverage
Tesla Stock To The Moon! Elon Musk Q2 - TSLA

Yesterday I added TSLA at $650 and will continue adding as covered calls provide excess cash.
Print the post  


What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.