I thought a Tesla was an iPad on wheels.
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This hasnât been reported by any reputable reporters has it? I canât see any?
Edit - I meant about the phone
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It depends if you think Reuters is reputable or not!
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Seems to be hush hush from Tesla.
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Itâs been rumoured for ages. There are YouTube videos about it. Even t3 had an article about it somewhere near the beginning of the year. There are lots of of gimmicky things on it like a Mars app or something (Mars the planet ⌠not on top of a Mars bar ) LoL.
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Remember itâs the Internet folks.
This is the first Iâve heard of a Tesla phone, but off the top of my head the only reason they would bring one out is if it synergises with their other businesses. I donât know much about the details of Starlink, but if it gets some benefit from that, then that could be a USP - Internet anywhere?
A satellite smartphone is a great move imo. Never lose signal again (within reason).
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The only thing is, Starlink is currently $99 a month so they will have to do something about that.
Looks like download speed is about 100Mbps.
Transatory, unlike inflation.
Hello there,
Sorry for the tardy reply.
Well, I think there are lot of points I would normally respond to; but Iâll stick to two points and perhaps we could have an interesting conversation.
(1) You say that exiting a position requires the âability to react as quickly when the time comes without warningâ (from your first sentence) but I have read some very interesting observations from Mark Howard and Warren Buffett that the time to exit a position is very early-on. Itâs being able to recognise on the income statement certain signs of worry and perturbation. I would very much disagree that moving in-and-out of positions from reacting to various headlines. In fact, there is huge statistical evidence (see the word of Terry Odean and, my favourite, Daniel Kahneman) that investors, on average, underperform when they react to âquicklyâ (as you say) to current events and headlines.
(2) You say âTesla is without question one of the greatest car manufacturersâ. I would agree that it has had a huge head start in the EV business - but beyond that, what is there? There is an excellent speech by Warren Buffet on YouTube (go to minute 14:00). He talks about his study of the auto industry in America since Henry Ford and explains that it has been a dreadful industry for investors. Most of the innovative exciting disruptive major players - of their day - soon went out of existence. He explains that, like the airline business, the car industry has been extremely fabulous to consumers all over the planet â but it has been a dreadful industry for shareholders. If you step-back, and take a broader view of an industry; and look at previous trends and patterns; youâll be surprised about how very little is genuinely new. What is that famous saying: âhistory doesnât repeat, it rhymesâ?
I suspect Buffettâs reluctance comes down to two important concepts (1) free cash flow generation and (2) a lack of a moat. Theyâre both intertwined. At the moment, the companyâs valuation does not reflect itâs performance today - its current valuation reflects an optimstic/panglossian sentiment about future performance (i.e. where the company will be in 2/3 years of whatever). Cathie Wood put out a statement that she expects Tesla to make ~10x cars or something in 2025 etc⌠The cars Tesla generate and sell today are no where near the targets that Elon Musk/company/analysists forecast for the future growth - and that is what the stock market valuation is pricing in today. But in order for Tesla to increase production - let alone compete with the likes of Apple & Ferrari & Xpeng / BYD & just about every other car manufacturer etc⌠- it has to massively and continuously invest in enormous factories & materials. This constant reinvestment by the company in the form of capital expenditure eats up the free cash flows. This is why FCF are absolutely 100% important. The old Wall-St expression ârevenues are vanity, profit is sanity but cash is realityâ is apt. That FCF is what creates shareholder value. Not to mention that Teslaâs debt more-or-less matches its liabilities on the balance sheet (the current ratio). It probably wonât borrow or issue bonds to fund this future growth; but raise equity by issuing stock. After all, those are the only two ways companies can secure financing: via debt or equity.
Just a few thoughts. 
Enterprise value is a good way of valuing the entire business- see this: Enterprise Value vs. Market Capitalization: What's the Difference?
The market cap only values the equity component of the company. Itâs an expression of market sentiment. On the other hand, the companyâs EV combines both equity and debt less cash. Itâs a much better way to value the underlying business. E.g. if a company has a market cap of ÂŁ100 with ÂŁ20 cash and ÂŁ50 debt; then its EV is ÂŁ130.
Most performance ratios are compared relative to EV. So, EV/EBIT gives a more accurate nuanced picture than P/E because it takes into account company capital structure.
This is not true.
Intangiles can be valued under GAAP accounting rules and are written-down (or amortised) in the income statement.
Ohh. But if we went back in time would our new future follow our present future we know off? 
Just read this article. I totally agree with it.
Muskâs 2018 tweet about taking Tesla private to Saudi business (if I remember rightly) is an absolute joke. I think heâs a glorified troll on twitter f-ing with people by making securities sky-rocket and collapse. He practically invented the memes. Totally unprofessional and JP Morgan have every right to sue for losses suffered from his ridiculous behavious.
I presume this happened in South Korea
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Iâm a huge fan of Buffett but his point here is only valid when looking at the shiny toy business of the past, auto makers and airline typically make 7% - 10% gross margin and require huge capex costs. While the latter is true with Tesla they have inhoused a huge amount of parts manufacturing, overhauled the assembly process and importantly double the margins.
When valuing Tesla as a car company theyâll always look over valued, value them as a hybrid saas/ tech business and ⌠well itâs still over valued but youâre on the right track. They have additional revenue streams from solar, batteries, auto pilot subscriptions / licensing & charging network. Each of these probably deserves a DD but thatâs not my skill set.
Ultimately there have always been companies that value investors cannot rationalise the valuation and stayed away from - this doesnât mean is going to fail it just doesnât fit into the model. Tesla is the lead example of a new class of narrative stock, where the story is more important than the financials. Will all this end in tears during the next correction (like the dot com bubble) who knows but the companies who are Tesla lite will almost certainly fair worse.
Thank you very much for bringing this up. And yes you can use that for valuation if you want to.
When I have valued companies I have looked at several measures including the Enterprise value. But the point of all those valuations has been to make an estimate of what the market value would (or could) be because I pay for a share in a market.
The only point I was addressing, in my comment, is the question about âtrillion dollarâ company which is being asked in the context of the share price i.e. its market capitalisation. And the point is that the market decides that. Doesnât matter if your Enterprise value is one trillion dollars if the only price that you can sell all the companies shares for is $1.
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