No. of Recommendations: 3
The bull case for TSLA that makes sense to me is they don't get any really amazing news any time soon. There will be dribs and drabs of good news in 2024:
* ramp of cybertruck production going OK
* exciting little snippets about Optimus (the humanoid robot)
* preservation of margin on cars despite price cuts
* progress on Berlin and Mexico Gigafactories and possibly announcement of the next Gigafactory
* continuing "excitement" about Full Self Driving, probably without a version that fully answers the mail yet
* some progress on the "cheap" new model, but not actually starting production
Then in 2025/2026 or later may come the "undeniables,"
* meaningful monthly sales of Cybertruck with a line to get them
* FSD version worthy of going to regulators and seeking approval at least somewhere in the world
* Optimus experimentally deployed in Tesla factories to do meaningful work
* lower interest rates increasing margins and sales rate growth
* "cheap new model getting built and bought
***********
What we don't know is how much and when the market will give TSLA a premium because it is going to, say, $1000/share by 2030. If I were trying to time my entries I'd probably look at $1000 in, say, 7/1/2030 as a bogey, and "DCF" back from there to see what my APR on the stock would be if I bought it now and it did that. At $190 today, if it does get to $1000 in the middle of 2030, one would be earning 30%/year for the next 6 years if they bought it today.
But of course if it goes to more than $1000, or gets there faster, one would have earned more than 30%/year, whereas if it got to less than $1000/shr or took longer, one would be earning less than 30%/year.
For myself, I stay in in it continuously. I don't know when the market will go up, but what I do know is
* I have to be in the stock when it is going up in order to reap the benefits
* No matter what it does in between going up or down, if I am in it continuously and it gets to $1000 in the middle of 2030, I will have made 30%/year.
******
If you don't think it will be at $1000 in 2030, you should possibly resist the urge to time the roller coaster, or at least I would resist that urge. A friend of mine who totally believes and therefore holds a bedrock position of TSLA continuously (since like 2011 or something) decided he enjoyed being smart so he traded in and out at the margin, writing puts when he though TSLA was relatively cheap and poised to go up. A rather casual analysis of his record doing this suggested it was COSTING him a few $100,000 a year, which he hadn't noticed since the bedrock position was going up so much on average it hid the cost of his hobby.
*****
So after playing games with strategies, I now just keep about 15% of my networth in TSLA stock and remember it is progress on Optimus robot, Full Self Driving, selling new models of vehicles and its energy business that matter, and it doesn't matter what it does in the meantime as long as it goes up in the next 7 to 10 years that matters.
Cheers,
R:)
