Tesla, Trading at $650, Gets $90 Price Target From JPMorgan

[catfish1957]

https://www.thestreet.com/investing/tesla-trading-at-650-gets-90-price-target-from-jp-morgan?puc=yahoo&cm_ven=YAHOO

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Tesla Inc.  (TSLA) -  Shares fell from their record high close of $650 per share Wednesday as analysts from JPMorgan lifted their price target on the clean energy carmaker to just $90.

The assessment from JPMorgan analyst Ryan Brinkman reflects some of the concern on Wall Street for the pace of Tesla's meteoric rise this year, which has added more than 660% to the group's share price and more than half a trillion dollars to the company's market value. Its net income for the third quarter of this year was $337 million.

Brinkman says Tesla shares are "in our view and by virtually every conventional metric not only overvalued, but dramatically so", citing a stock price that trades at 1,325 times its long-term PE multiple and 291 times its 2020 estimate. 

Brinkman advised clients not to increase their holdings in Tesla to its approximate 1.44% weight in the S&P 500 benchmark, even as the bank itself suggests that index-tracking funds will sell $57 billion worth of shares in other companies in order to gather up Tesla shares before its December 21 entry.
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I've never made it a secret of my dislike of Musk's boondogle and taxpayer subsidized little project.  But I can honestly say, that I have never seen a reputable analyst (like this one at JPM), predict and project an 86% correction in one year.  But, who has ever seen the level of speculative insanity that investors have staked in this one equity.  And as far as Tesla's future?  You really think that Musk is giving much attention outside SpaceX?  As they always say.....  "Buyer Beware"

[IsailedawayfromFR]

https://www.thestreet.com/investing/tesla-trading-at-650-gets-90-price-target-from-jp-morgan?puc=yahoo&cm_ven=YAHOO

<snipit>

Tesla Inc.  (TSLA) -  Shares fell from their record high close of $650 per share Wednesday as analysts from JPMorgan lifted their price target on the clean energy carmaker to just $90.

The assessment from JPMorgan analyst Ryan Brinkman reflects some of the concern on Wall Street for the pace of Tesla's meteoric rise this year, which has added more than 660% to the group's share price and more than half a trillion dollars to the company's market value. Its net income for the third quarter of this year was $337 million.

Brinkman says Tesla shares are "in our view and by virtually every conventional metric not only overvalued, but dramatically so", citing a stock price that trades at 1,325 times its long-term PE multiple and 291 times its 2020 estimate. 

Brinkman advised clients not to increase their holdings in Tesla to its approximate 1.44% weight in the S&P 500 benchmark, even as the bank itself suggests that index-tracking funds will sell $57 billion worth of shares in other companies in order to gather up Tesla shares before its December 21 entry.
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I've never made it a secret of my dislike of Musk's boondogle and taxpayer subsidized little project.  But I can honestly say, that I have never seen a reputable analyst (like this one at JPM), predict and project an 86% correction in one year.  But, who has ever seen the level of speculative insanity that investors have staked in this one equity.  And as far as Tesla's future?  You really think that Musk is giving much attention outside SpaceX?  As they always say.....  "Buyer Beware"

It is best just to consider Tesla as another technology stock and act accordingly.

[catfish1957]

It is best just to consider Tesla as another technology stock and act accordingly.

Yeah, but didn't that 1325 P/E ratio induce some ghasps?  I just as soon stick a $100 bill in a slot machine.

[IsailedawayfromFR]

Yeah, but didn't that 1325 P/E ratio induce some ghasps?  I just as soon stick a $100 bill in a slot machine.

Do enough times and the odds are you will win every once in a while.  It is more of a testament to your endurance at the slot machine.

Same risk as buying technology stocks in a bubble like this one.

BTW, I considered Enron the same way back in the late 90s and never bit off anything on it either, in spite of it being a darling of the market.

[catfish1957]

Do enough times and the odds are you will win every once in a while.  It is more of a testament to your endurance at the slot machine.

Same risk as buying technology stocks in a bubble like this one.

BTW, I considered Enron the same way back in the late 90s and never bit off anything on it either, in spite of it being a darling of the market.

I've never been a dice throwing investor.  I research, graph, and grapple to death my portfolio.  My sole risky venture was a '90's forced REIT spinoff into a B2B tech info company that went from $2/sh to $500/sh, then back to zero.  Those 50 shares were a roller coaster that I can use and laugh at as an experience.  Otherwise, nothing beats good fundementals, sound corporate governance, a LT sustainable business models, that in especially in my case and age....   equities that spew  cash divys like crazy.  Yeah, I get pretty obsessvie and excited with it.

[IsailedawayfromFR]

I've never been a dice throwing investor.  I research, graph, and grapple to death my portfolio.  My sole risky venture was a '90's forced REIT spinoff into a B2B tech info company that went from $2/sh to $500/sh, then back to zero.  Those 50 shares were a roller coaster that I can use and laugh at as an experience.  Otherwise, nothing beats good fundementals, sound corporate governance, a LT sustainable business models, that in especially in my case and age....   equities that spew  cash divys like crazy.  Yeah, I get pretty obsessvie and excited with it.
[/quote

We seem to hold similar philosophies, mine maybe a bit more into conservative dividend growth stocks.

Had one experience though just a few months ago trying the risk market by buying into a company I read up on that had received FDA approval on a peanut allergy medicine but prevented from marketing due to Covid.

Entry price was right so I bought with little hope it would be all that great.  Lo and behold, Nestle made a tender offer a short few weeks later and my investment more than doubled overnight.

That was the good news.  The bad news is my career was a lot involved in exploration risk ventures and my experience is that the worst thing to ever do is to drill the first exploration well successfully as one will believe the secret to success has been found, and risk guidance on future wells will be tossed out the window.

I am strongly resisting the urge that I found a secret formula.

[catfish1957]

I've never been a dice throwing investor.  I research, graph, and grapple to death my portfolio.  My sole risky venture was a '90's forced REIT spinoff into a B2B tech info company that went from $2/sh to $500/sh, then back to zero.  Those 50 shares were a roller coaster that I can use and laugh at as an experience.  Otherwise, nothing beats good fundementals, sound corporate governance, a LT sustainable business models, that in especially in my case and age....   equities that spew  cash divys like crazy.  Yeah, I get pretty obsessvie and excited with it.
[/quote

We seem to hold similar philosophies, mine maybe a bit more into conservative dividend growth stocks.

Had one experience though just a few months ago trying the risk market by buying into a company I read up on that had received FDA approval on a peanut allergy medicine but prevented from marketing due to Covid.

Entry price was right so I bought with little hope it would be all that great.  Lo and behold, Nestle made a tender offer a short few weeks later and my investment more than doubled overnight.

That was the good news.  The bad news is my career was a lot involved in exploration risk ventures and my experience is that the worst thing to ever do is to drill the first exploration well successfully as one will believe the secret to success has been found, and risk guidance on future wells will be tossed out the window.

I am strongly resisting the urge that I found a secret formula.

Great story, I have a few of those too, including a few bullworths like APPL that I got into nicely at double digits pre-split.  You might have over estimated my risk taking.  I have significant interest and love in nicely rated high paying Corp. Bonds.  I still have some on the back third of their tenure, up in the 6-8% yield range.  And then there is my wife....   She's had a lifetime love of CD's and working the interest rates at optima times.  Then add farm and timber land, metals, etc.  We actually are pretty conservative investors, especially with the core of what we need to live on.

Last March was an opportunity of a life time.  One of my three kids took the plunge, and has quad his portfolio. He pulled off a right place, at the right time like me in '87. Nothing like a little family competition.