Tesla is a speculative play which seems bizarre when you consider the multi-billion dollar market cap.
I have come to the conclusion this stock is tradeable from $300 upwards. Time and time again we have seen Elon Musk bailing the company out in times of trouble by announcing new projects, deflecting criticism and continuing to focus on the future.
I agree, Tesla seems to be a share to sell just after the good news and when other investors join the buying frenzy. It then drifts down towards the $300 level at which point the flamboyant chief executive officer Elon Musk steps forward with yet another publicity gem!
When will investors grow tired of the “jam tomorrow” promises and demand that the company starts banking some profits? It is all good and well expanding for the future but the cash burn at Tesla must be like a bonfire!
Hey presto, Elon Musk does it again with a yet another announcement:- https://electrek.co/2018/01/20/tesla-model-3-dual-motor-fleet-registered/ He’s very good at taking the short term pressure off the company by encouraging investors to look longer term. However, those interested in Tesla should look at the cash flow!
The performance of the share price over the last couple of weeks was indicating some news was on the way. This man is absolutely amazing at rolling out positive headlines time and time again just when people were starting to get concerned about the company’s performance.
So, Elon Musk is on for a $55b bonus if he can build Tesla up to a $650b market cap in the next 10 years. He has agreed not to take any pay or remuneration out of the company for those 10 years. Current market cap around $60b so 10 times the value in 10 years: https://www.theguardian.com/technology/2018/jan/23/elon-musk-aiming-for-worlds-biggest-bonus-40bn
At the end of the day shareholders will benefits by a cumulative minimum of 10x Elon Musk's bonus - assuming he hits his targets. There will be some criticism of the amounts involved but would people be complaining if the company was worth £10m and the ceo was offered a £10m bonus (and no salary) if he hit a £100m market cap over 10 years?
Check out this great article about Elon Musk's early life:- http://www.esquire.com/news-politics/a16681/elon-musk-interview-1212/
