Research archive for TSLA

Tesla, the car company that makes the best looking electric cars in the world, released their Fourth Quarter & Full Year 2014 results on Wednesday night last week. Elon Musk, the founder and CEO went to Pretoria Boys, so this company has a soft spot with us in the office, seeing as both Paul and Byron went to that fine establishment. The results were not as great as the market were expecting, they had pencilled in a profit compared to the 4Q loss of $0.13 a share, resulting in a drop around 7% in the share price.

When owning companies, you are not owning a share price. You are owning the future profitability of that business and paying a price today for that. The collective try and figure out whether or not the price is right, right now. Tesla is a great example of that. What a business! They are trying to revolutionise the way we think about private transport and the combustions engine. However, the business does not make meaningful profits, if any. They are only going to sell 35 thousand vehicles this year, of the Model S that is. The expectations are for a run rate of 100 thousand vehicles next year.

What is Elon Musk doing? Would you do that? I am talking about his business, Tesla Motors, and what was released on his blog yesterday: All Our Patent Are Belong To You. Huh? Quite simple:

Tesla are raising 1.6 billion Dollars and taking this massive opportunity to put their best foot using the recent excitement around their results as a huge opportunity, through a convertible bond issue. First production in 2017, 500 thousand motor vehicles to be manufactured at what Elon Musk calls a "Gigafactory". Everyone is getting very excited about this. A what? Well, Tesla have a simple paper out, you can download it:

Yesterday Tesla finished up over 8%, significantly breaking the $200 mark for the stock. If you bought the stock today a year ago, you would have paid ... (wait for it) ... $35 a share. Yes a year ago you could have bought Tesla for $35 and today they are worth $210, so you would have made a cool 500% in a year.

Tesla Motors, the sleek, electric sport car manufacturer based in California is up more than 500% this year. The company was founded by Elon Musk (the new Steve Jobs in my opinion) who also founded Pay Pal and Space X (a space transport company). To top off this storey Mr Musk is a South African, he matriculated from Boys High before moving to the US of A. The name Tesla is from Nikola Tesla, one of the fathers of AC (Alternating Current) electrical supply.