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Should I invest $10,000 in Tesla?

Should I invest $10,000 in Tesla?

When would I expect to get a $50k on up return if I were to buy $10k worth of Tesla stock this month?

4.5 billion factory under construction

Theyre going to eventually properly mass produce affordable mainstream cars

They're going to eventually mass produce batteries for home/commercial buildinGS

Amongst other groundbreaking projects as the years go by I'm sure

Simply put, there's plenty of room for growth for Tesla.

The question is...Would investing $10k worth of stock be a genius move? How ling would it take to see a significant return?

Thanks bros

David N | 03/05/2015

The question is...Would investing $10k worth of stock be a genius move?
No
Some invest because they want to make money, period. They couldn't care less about what the company does or sells, making money for themselves is their priority.
Others invest because they believe in the product, the mission of the company, and they want to be part of that. Every shareholder is "part owner" of the company.
Should you invest in Tesla? only you can answer that question.

rileysticka | 03/05/2015

I'm worried that it's too late to make a significant return.

to get reach 50k I would need a 500% increase in stock value...

Whwn could I expect to reach st least 20k, guys?

TaoJones | 03/05/2015

When will a $10K investment become $20K?

That would be when the stock doubles in value, not including the impact of taxes.

Consider finding the TMC thread about options trading. It's quite long and has a few good insights.

Try to avoid creating a small fortune solely via starting with a large one. There's soooo much information at your fingertips. Schwab research reports, OptionsXpress tools, TDAmeritrade community resources, and for that matter, motifinvesting.com for something slightly different. Were I to create a Tesla-related motif today, it would include Tesla, Solar City, Mobileye and maybe 1 or 2 others at most.

Bubba2000 | 03/05/2015

The easy money has been made starting when the stock was <$35, short interest was 47% of the float and the shorts were paying nearly 20%/year to borrow shares at the end of 2012 and early 2013. All Tesla had to do was survive to burn the shorts and boost the stock above $200/s.

Now, Tesla will have to deliver, totally disrupt the automotive industry with BEVs, or the battery/utility business. For BEVs, the key enabling tech is the $/KW-hr and KW-hr/Kg aw well as long life. For the battery/utilities it is $KW-hr packaged.

Personally, I think that Tesla will disrupt the battery biz. Even at current battery prices, the Powerwall and utility biz has not been priced in. I think there is a huge demand for these batteries in the developing countries in the residential and business market. Most of these countries starting with India, Angola, Mozambique, Kenya, etc have an unstable electrical power. Plus the huge global wind and solar electrical generation. Even before the GF, Tesla has a huge cost advantage.

Competition? At the residential and business level, it is mostly with systems based on auto batteries that do not last more than 2-3 years, need a lot of maintenance. Diesel generators are too expensive to run, maintain, noisy. Most of the brownouts and power failures are intermittent lasting few hours or less.

Red Sage ca us | 04/05/2015

No. Go to Las Vegas. Head to the nearest available roulette wheel. Put $10,000 on black.

If you win, go back home, and invest $10,000 in TSLA.

If you lose, go back home, and cry.

;-)

ian t.wa.us | 04/05/2015

I think if any of us KNEW the stock would double or quintuple again we'd all be loading up ourselves. No idea when OR IF that will happen.

In other words, you're asking an unanswerable question.

Cheers!

Captain_Zap | 04/05/2015

@ian

I've been loading up. Do you think it's not going to double or quintuple? Or is it just a matter of timing? ;-)

I think Telsa could become as big as GE or Mitsubishi.

ian t.wa.us | 04/05/2015

I think it certainly will!

If it wasn't already our largest position my lovely wife might be more comfortable buying more. ;-)

windex | 04/05/2015

The only money I have sitting in TSLA now is the money I intend to keep there for a long time. Until Tesla starts pushing out the Model 3 in large quantities I doubt we'll see another race in the stock that beats index funds.

Mathew98 | 04/05/2015

If you bought $10K worth of May $185 call option last month then you would have reached the goal already.

Hindsight is always 20/20. Otherwise you're just gambling.

Bubba2000 | 04/05/2015

In my opinion, Tesla is already making profits. Their operating profits were 27%. What ate the profits was the 3 to 4x increase in R&D and SG&A associated with Model X, increase in SC+Service, and the GF, etc. I think that these increased outlays should have been capitalized and depreciated once the associated production starts. Tesla is just being conservative.

Tesla may have to raise $2.5-0.5 to finish the GF and start onModel 3. With the stock at $200+/s it makes sense to raise money.

DougJohnson | 04/05/2015

Based on the fact you are asking the internet how to quintuple your money, you would be crazy to invest in anything riskier than a bank account. You are setting yourself up to get taken.

Shad_dash85 | 22/06/2015

Poolease, tesla has a fraction of the auto market. T is at the cusp of mass production, reducing battery costs, all this reduces costs. Increased market and lower cost equals profitability! Get off the sidelines or you will regret it.

georgehawley.fl.us | 23/06/2015

A group of insiders led by the Chairman of the Board and Elon's brother just exercised 50 K worth of options each at $261.89. I think that is a good sign but I am not an expert in these matters.

vperl | 23/06/2015

Depends, if you are willing to take huge hit, and what type invested you are.

Risk is risk, be willing to wave good bye to your cash or stay away . . . no kiddies allowed in the pool.

rdeaner8 | 23/06/2015

We invested in Tesla stock because we believe in the company and what it is doing. Because we believe in the company we also bought a 2015 Model S.

Mike83 | 23/06/2015

The gamblers are those holding a short position. To cover now they need $6625000000. I expect some negative and\or antagonistic posts.

Shad_dash85 | 23/06/2015

vperl | JUNE 23, 2015 NEW
Depends, if you are willing to take huge hit, and what type invested you are.

Risk is risk, be willing to wave good bye to your cash or stay away . . . no kiddies allowed in the pool.

Its irritating when people make blanket statements, yes captain obvious there is risk, for some its risky to get out of bed.

Why don't you point out why T is risky and actually add something to the blog.

If money was invested when this blog was started and sold today it would have gained over 14% in 2.5 months.

Red Sage ca us | 23/06/2015

By the time Tesla Motors, as a company, is worth the current ~$33,000,000,000 market capitalization of TSLA on Wall $treet, the stock will have a $300,000,000,000 market valuation.

vperl | 23/06/2015

Shad, why is Tesla risky?

Gee, guess your right, no risk involved.

Sorry, must be a absolute winner for you and nothing is a risk.

A sure thing in your mind, great.

Party on Garth.

Shad_dash85 | 23/06/2015

300 billion/$40K per car = 7.5 million cars. Global auto sales hit all time high of 82 million in a year. Sure it won't happen in a year, but it doesn't need to. I only need one reason to invest in T and that is Elon Musk.

Loose numbers but certainly not a deal breaker for me.

I would really like to hear lay mans logic on why T is a poor investment? I think there are plenty of reasons why its a great investment?

ST70 | 23/06/2015

If you would have invested on May 3 you would have about 20% return or about $2000 in gains today....not bad for less than 2 months

ghgregory | 23/06/2015

My wife and I invested $10K just a few weeks ago when it was $196. Closed today at $267. We're on the list for an MX and believe very strongly in the future of Tesla, which is our reason for investing. Yes, there's risk, there always is, but if we had another $10K to invest today, we'd put it in Tesla.

Short sidenote: some years ago we invested ~$3.5K in Apple. That stock is now worth over $90K. In essence, Apple is paying for our Tesla.

Vawlkus | 24/06/2015

Tesla is a volatile stock, and will remain so until some time after the Gen III hits the market.

I invested 8k because I believe in what Tesla is trying to accomplish, and because I see the stock rising once it hits the mass appeal market with the Gen III. It helps that I bought in at $33 a share. Really wish I could've bought in at $17 a share at IPO. ;)

Shad_dash85 | 24/06/2015

Yes I have learned (the hard way) volatile stocks can be brutal, but we have to remember why we invested. I try not to panic when there is gloom and doom and blood on the streets and try to remember why I invested. If its a quality company it usually comes back. I think T is exactly this type and that it could easily quadruple in a relative short time. Fact is I feel, in time T could climb to the heights of Apple and GE and possibly even surpass. T is run by a visionary and is gobbling up some of the best talent on the planet. T is unique because its not solely motivated by profit and I hesitantly say is concerned about the environment which is very powerful because it stands apart for corporate greed and attracts attention from a global mass of a new generation that is quickly taking control. E. Musk is tackling planet earths most pressing issues with true grit and steadfast brilliance. His story is remarkable.

carlgo2 | 24/06/2015

Tesla will likely have the best and cheapest battery that will give them an advantage in a number of markets and a good reason to invest.

Charging remains a concern. I want to see a sign.

Grinnin'.VA | 25/06/2015

OP: I'm not going to tell you how to invest your money because I don't have nearly enough information about your financial situation and goals.

I will tell you a bit about mine.

* I bought an 85D, which I find delightful to drive as expected. I paid cash for it without any strain on my financial situation.

* I am a retired government employee who saved and invested more than most during my peak earnning years. I take money out of my IRA because the tax rules require me to, not because I'll need the money any time soon.

* I also bought quite a bit more than $10K in TSLA stock, expecting to keep as a long-term investment.

* In recent months I've become concerned about the risk in TSLA stock ownership. So I sold my TSLA stock. What triggered my concern?

A. Delays in Tesla's delivery of anticipated new things (new SC sites, MX)
B. Abandonment of previous statements of 7%-8% increases in battery energy density.
C. Apparent need for large amounts of new capital to finance Tesla's plans.
D. An increasing trend toward hostility of many Tesla forums participants.

This place seems like a much less welcoming place than when I joined it in 2014.

I repeat: I'm not trying to tell you how to invest your money; I'm sharing my thinking and my decision to eliminate my exposure to perceived risks in TSLA.

Good luck.

P.S. I'm not looking to sell my 85D because it's a marvelously fun car to drive.

Grinnin'.VA | 25/06/2015

Point of Clarification: The previously projected 7%-8% increases in battery density were described as per year with an expectation that that would probably continue at least until the mid 2020s.

jackjgalt | 25/06/2015

Well, we quintupled my wife's 401k when Tesla began its initial run, used trailing stops to protect profits and jumped back in at every major pullback of 20% or more since. Tesla is a volatile stock, but approached accordingly can generate nice profits. When the stock did its last major pullback in Sept '14, we got stopped out again. We jumped back in in Jan and March...and have +35% gains before taxes since then. The huge short float is definitely helping, and the coming short squeeze (likely happening now or soon!) will only help us more. It helps that we both believe in the company, it's products and long term goals...so win-win for us all around.
We always price-in exactly what we are willing to lose before we ever make a single trade...and stick to our investment choices. Emotion is a dangerous foe when it comes to investing...makes you buy high and sell low. You need to make your decisions based on whatever investment model you are pursuing and stick with it.
My 2-hundred million cents worth (...thank you EM!)

Red Sage ca us | 25/06/2015

Grinnin' Ron: I still believe the ~8% annual improvement in battery technology takes place, on average, in the laboratory. I remember no 'promise' that such would be delivered to actual end user purchasable products on an annual basis. Such incremental improvements are best applied as a singular aggregate upgrade that corresponds to new product releases. I never expected a new battery pack per year... Did you, really?

Shad_dash85 | 25/06/2015

I agree the battery improvement is difficult to measure at this time and very debatable. Depending on when the measure starts the efficiency nearly doubled from 2010 to 2012 which adds many years at 8 percent per year. Points A and C are debatable as well. There will be delays and set backs, I'm sure its not easy to start a new car company in a cut throat industry. Why not source capital at low interest rates if needed, the upside is astronomical. That being said these are very valid points and part of the risk.

Regardless I still think T will be way ahead after playing around with their new GF toy. Elon Musk has said raw materials for the batteries cost very little, its more about manufacturing and assembling the materials that is costly.

I like the simple strategy of buying on the dips and using trailing stops to lessen the blow. I did this with apple along with options trading using calls and puts. Made some money but no real home runs yet.

My goal is to reserve a model III in 2016 if everything goes well, I will give the wifey my prius, she has been a circling vulture for a while now. Hope she can hold off...

side note: does anyone know if you can get email notifications when a topic has new comments. thanks

Shad_dash85 | 25/06/2015

I'm not aware of the hostility in the forums? can you elaborate? that is disturbing? Why? and thank you.

jackjgalt | 25/06/2015

Oh,
In the last year or 2 there were some forum trolls that were huge bears of Tesla stock (they read way to many Barrons' articles!). They basically cruised the forum and baited people with as much negative talk as possible about Tesla. Usually when that happens I assume it is some of those who short the stock. I would say that the shorts have "been taking it in the shorts" quite a bit over the past few years!

Shad_dash85 | 25/06/2015

I have to admit I had to brush up on short selling terminology, it sounds like it is being suggested that these trolls have gotten nailed by trying to short T and now the opposite is happening: the squeeze? Am I understanding that correctly? If I am then these trolls where probably "rumor mongering" which is illegal or unethical at best. Well they have met their match with the astute members of these forums.

Grinnin'.VA | 26/06/2015

@ Red Sage ca us | June 25, 2015

Grinnin' Ron: I still believe the ~8% annual improvement in battery technology takes place, on average, in the laboratory.

What's the latest date when a Tesla executive reaffirmed the continuation of this progress?

I believe that Elon's most recent statements on this suggest that we might get 100 kWh batteries by 2020, or some such thing. That's much slower progress than previously claimed.

I remember no 'promise' that such would be delivered to actual end user purchasable products on an annual basis.

Please pay attention to the actual words I post. I did NOT say anything about a Tesla "promise" of their expected/projected battery progress. JBS and Elon once claimed that Tesla was making 7%-8% improvements per year and that that improvement was expected to continue for another 10 years at least. Recently, they haven't said anything remotely similar to that.

I never expected a new battery pack per year... Did you, really?

No, I never expected Tesla to introduce a new, higher-capacity battery every year. I'm baffled that you seem to think that I meant that.

Their previous statements indicate that if they release a new, higher-capacity battery in 2017, we should expect it to have a capacity of about 119 kWh, which is 5 years' worth of increasing energy density from the current 85-kWh pack that was first delivered to customers in 2012.

My assumption is that Tesla's battery R&D effort has been continuing since at least 2010, yielding the claimed rate of improvement. Isn't that a reasonable assumption?

Timo | 26/06/2015

Tesla isn't making that 8%, it's battery industry in general.

rwatson485 | 26/06/2015

I've always been a buy and hold investor, only considering selling off a position to offset gains (for a loss) or when a position becomes a too large a percentage of my portfolio. I took a small position in TSLA in March. I would prefer to have bought convertible/preferred, but maybe it will be offered at some future date. I am confident that, were TSLA to go under, the collectable value of my model S would offset my loss in the stock.

Brian H | 26/06/2015

Shad;
No email notifications. The main page shows when a thread has new replies. Click the second # in the Replies column to go to the first new one.

Grinnin'.VA | 26/06/2015

@ Timo | June 26, 2015

Tesla isn't making that 8%, it's battery industry in general.

In 2014 JBS made direct statements claiming that rate of progress in improving Tesla's Li-ion batteries. For all of 2014, Elon's public statements reflected that claim.

If Tesla is falling short of the battery improvement progress claimed last year, IMO they owe us at least a progress report. They know very well that increasing the battery pack capacity is a key to increasing the range of the MS, which happens to be near the top of the list of concerns for a very large portion of their customers and prospective customers.

Shad_dash85 | 26/06/2015

Thank you Brian H.

Brian H | 26/06/2015

Tesla's real-world progress in making usable large auto BEV batteries surpasses all others', and gives every evidence of being able to continue to do so. What more can one ask?

vgarbutt | 27/06/2015

I don't have any stock, but if i had money for that i would invest all of it.
i wouldnt want to predict when to sell, but i think it will easily double by 2018/19 i predict.

tesla stands for hope for our environment, how could it get better?

Red Sage ca us | 28/06/2015

Grinnin' Ron: As I understood statements by Elon and JB, during the Q2 Earnings Call in July 2014, they were speaking of a potential for an approximate ~15% increase in battery cell capacity, though by using an optimal cell size. I understood that to be relative to what was available in 2012. Hence, a given capacity in 2012, with a 7%-9% improvement to 2013, and another 7%-9% improvement beyond that, is approximately equal to a 15% improvement noted, during research, by 2014. Right on target (85 x 1.08 x 1.08 = 99.144) as far as I can see.

What I heard Elon say in subsequent interviews was that specifically regarding a cruising range of 400 or 500 miles, that would not appear in Tesla Motors products prior to perhaps 2019, possibly 2020, certainly no earlier than 2018. Please let me know where he specifically stated anything at all relative to a precise 119 kWh battery pack capacity, because I must have missed that entirely. It seems an important piece of information, that I am surprised to have been let slip at all.

Grinnin'.VA | 29/06/2015

@ Red Sage ca us | June 28, 2015

Grinnin' Ron: As I understood statements by Elon and JB, during the Q2 Earnings Call in July 2014, they were speaking of a potential for an approximate ~15% increase in battery cell capacity, though by using an optimal cell size. I understood that to be relative to what was available in 2012. ...

Please let me know where he specifically stated anything at all relative to a precise 119 kWh battery pack capacity, ...

The 119 kWh number is my simple calculation for a higher-capacity battery to be delivered in 2017. This is based on an assumed 7% increase per year for five years, the low end of the 2014 JBS claims. That's 85 kWh for 2012, 91 kWh for 2013, and so on for the five years difference between 2012 and 2017. For 2017 the actual number is 119.2 kWh.

Did I screw up the assumptions or the math?

Red Sage ca us | 29/06/2015

OK. Gotcha. Seems fine.

Optimistic as ever, I still hold out hope that somehow, miraculously, Tesla Motors will manage a 120-to-135 kWh capacity battery pack for Generation II cars prior to the end of 2017.