I was surprised to find out that not only is Tesla's current operating margin lower than some other auto OEMs, but so are their gross margins.
Toyota has a gross margin just under 20%.
So it seems on the surface that Tesla is just like any other OEM in terms of cost to build.
However that is with EV costs while Toyota and others are primarily ICE / hybrids. I could imagine their costs and gross margins would be surpressed as they transition to more EVs, so it's not an apples to apples comparison. But I fear currently it doesn't make sense to proclaim Tesla has a superior cost structure.
Even after all the price cuts and flat earnings, if Tesla is able to keep current operating margins and grow revenues ~ 50% YoY in the future, this will allow for a high PE multiple like 50-80 even as earnings go higher.
So 2023 is a wash, EPS might be in mid threes, like $3.6. But what can 2024 look like? I can see $1 additional contribution from Energy growth. I would also assume that Model 3 revamp should improve ASP and reduce COGs. Could this, and Cybertrack ramped, contribute at least $0.5 in EPS in 2024? I would think that's a reasonable bet.
If so, TSLA should be able to get over $5 in EPS in 2024 with good growth trajectory. At a PE ratio of 70, I think we might be able to reach a stable price of $350 maybe in a year from now.