I know you’re heavily invested in the Tesla picture, and I sincerely hope that it turns out. Seriously.
Thank you very much!
For me, it’s just too much of a roll of the dice. Too many other opps out here to tempt me to “shoot the moon” with Elon.
I’ve often said that a portfolio has to fit the owner like a well tailored suit. Tesla fits me. It doesn’t fit you. That’s just fine! BTW, I was only mocking the predictions. We tend to get them truly wrong! I had the same feeling about Apple when the iPhone came out. I really missed out!
I have a long history investing in EVs starting in December 2010
October 31, 2010
Investing: Kandi Technologies, Corp. (KNDI)
While Kandi didn’t work out I made very good money trading the stock and options from December 2010 through May 2015. IRR 43.2%. With Tesla’s IPO KNDI took off but soon fell back to earth. I hadn’t heard about Elon Musk until the day he put on a battery swapping show which was just smoke and mirrors. He turned me off but I did follow Tesla because their business model made sense to me.
A tipping point came in February 2014 with the first coast to coast crossing in an EV charging only at Tesla’s SuperChargers.
February 3, 2014
Tesla’s Tipping Point
From Sticking Point To Tipping Point
Complexity is the enemy of adoption. Anything that is too complicated just won’t happen. For battery powered electric cars two of the barriers to adoption have been range anxiety and the time it takes to recharge the batteries. There are thousands of gas stations for conventional automobiles and fueling up only takes a few minutes. There is no equivalent infrastructure for battery powered electric cars.
I think it’s worth your while to read this article.
Fast forward to September 2020, to Tesla’s Battery Day where they announced the 4680 battery cell. By 2020 I had stopped posting at Software Times. After watching the presentation and the efforts of incumbents to enter the market I figured that EVs had crossed the chasm and that it was now safe to invest in Tesla. I started with a modest position, added a couple of times, took profits when it shot up, bought back in after it dropped and then added some more.
I’m not going to argue that the valuation makes sense because I don’t think we have the tools to calculate the value of fast growers. DCF makes sense to evaluate bonds but not stocks and much less growth stocks. I rely on the concepts of The Gorilla Game and the sigmoid or “S” growth curve. 87% y/y increase in vehicles sold, huge gross margin, and hefty free cash flow are indications enough for me. But there is more, Tesla’s Agile management system, the success of SpaceX [initially I thought that Jeff Bezos would win the race]. To top it off, Herbert Diess, the VW chief, invited Musk to give VW managers a pep talk about how to make EVs! Unheard of!
Besides EVs, the bigger transformation that I see is the paradigm shift from utility centric to a distributed power grid with every rooftop harvesting sunlight and local battery storage. The beauty of this paradigm is the shift away from central planning!
PS: My TSLA heavy port fell a lot less than Saul’s port this January!