Just trying to be objective here:
PE ratio increasing
Lower margins
Buyers having troubles accessing credits
VS
GM, Honda, Toyota, Ford delaying
Their EV targets because of prices making it unprofitable
Do we have to adjust the TSLA growth story and Price Target in the long term or you guys are all staying Permabulls in the long term. Have you readjusted the TSLA thesis. Trying to see if selecting a Jan2026 300 strike is smart or I should adjust.
No change to my own long term thesis. 10x the ATH by 2030 is my simplistic view of things. I think it highly unlikely we go that far by 2025, but I also wouldn't be shocked.
The lower margins is something that might be here forever, between competition coming in a decade or so, plus Elon and Tesla choosing lower margins in order to keep the manufacturing output growing at such a high rate.
Reality is that I expect margins to fluctuate a lot more than most investors are accustomed to because the decision making at Tesla is driven by a different underlying view of the world. Namely - MBA types learn in school to keep prices as high as possible consistent with utilization of assets, maintaining pricing power, maintaining market share, etc.. Tesla chooses prices based on growing units by 50%, and the corresponding increase in manufacturing assets, while maintaining positive cash flow and profitability, all in service to the Secret Master Plan and company mission.
Its one reason Tesla doesn't fit well into the boxes people learn about in MBA school, and makes it harder for MBA trained financial people to analyze the company. Tesla is in business to achieve the mission, rather than being in business to make a buck (or at least that's the way I see it). There aren't very many of these around
Meanwhile I don't see any of the other American or European manufacturers being in danger of growing their EV business in a big way, or becoming cash flow positive, or becoming profitable. All 3 things need to happen, in approximately that order. I do see expenses going up for other manufacturers, making it harder for any of those things to happen.
End result for me - I've already begun buying the Jan '26 300 strike calls, and expect to buy more soon. We've broken below 200 today - I started buying around 220 or 230 ($52 for that option); I see that they're down to $38 or so right now and that means its about time to buy more for me. An important driver for this decision is that I am currently much higher cash than I'd like to be, so I am actively looking to buy.
I have 200 strike puts for this week that I hope to be assigned - I add some more of those calls at $35 I think, and that looks like a share price of 190ish to me.