Berkshire gaining on Tesla…

“Tesla is the fifth most valuable stock in the S&P 500. But Warren Buffett is coming for that spot as investors are finally giving the cold shoulder to growth stocks and giving more love to value stocks.”

Let the fur fly!


"Tesla is the fifth most valuable stock in the S&P 500. …
Let the fur fly!

Hey, it is what it is. No need for flying fur.

But it’s good to add a bit of precision: it’s “valuable” in the sense of current perceived/market value, as opposed to actual value.
For any firm, those are usually two different numbers.

The value of any purely financial security is the present value of all the future distributions it could support, including any final distribution on liquidation.
Tesla is absolutely worth its current market cap, or more, if the present value of all future coupons it could pay out is at least $840 billion in today’s money.
If they accomplish that, it’s not overvalued, and good for them. If they don’t, it is overvalued.
The future hasn’t happened yet, so opinions can differ till we all know for sure.

Tesla shares, of course, are a bit different from most. It’s probably not a purely financial security, as many people seem (?) to own it for non-financial reasons.
Like shares in Ferrari or Manchester United or Bored Ape.
I’ve heard Tesla shares called an NFT: a “non financial ticket” for a wager.
Nothing wrong with that, just pointing out that if it’s not a pure financial security then there is no rule about actual value, as it’s not an investment in the usual sense.
The future price is down to the popularity contest.
Again, nothing wrong with that. All power to them, and to Bored Apes as well.



Rate of return is more important than size.


Rate of return is more important than size.

Thankfully that’s what she said.