Tesla has recently been added to the S&P 500 which is huge for them! For those of you who don't know, the S&P 500 is an index that contains the top 500 publicly traded companies in the stock market. After Tesla was officially added, their stock price has been pumped up to all time highs ($500 per share). Tesla is one of my personal favorite companies because I believe like many others that they are in their infancy. The electric vehicle market demand has the potential to 10x over the next 5-10 years. One reason this will happen is the increasing threat of climate change. Everyday, climate change is getting worse and we are seeing more civil unrest. Electric vehicles are scientifically proven to be safer on the environment and this will give all electric vehicles a competitive advantage over gas powered vehicles. On top of this, Tesla is also involved in the energy industry which I believe is being slept on by investors. The CEO of Tesla, Elon Musk has said himself that he believes their energy business will grow to be larger than their electric vehicle business by 2030. There energy business is also extremely beneficial for the environment because they are using renewable energy. Tesla is a company that I not only want to succeed because I will make a profit on my investment, I want them to succeed because they will help the entire world and in turn help our economy thrive. What do you think about Tesla?
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I think also that Tesla being a newer company and achieving being added to the S&P 500 separates them from most companies, let alone car companies. Everyone wants a Tesla, and I feel that their company will continue to grow over the next few years. They are a very unique brand with a lot of advantages over their investors, so I project them being very successful for years on end.
ReplyDeleteI think that this is great for Tesla, and I want the company to succeed, however, I do have some concerns that they were added to the S&P 500. In one of my other classes, we did a case study on Tesla and a question surrounding the company is whether they are overvalued. At the time of the case study, Tesla had yet to be consistently profitable and was struggling to profitably scale up production. I concluded that Tesla's stock was not being hyped-up as long as the company can overcome the current barriers to entry and produce at the required larger scale. But if they can not overcome current production issues, the company looked to be overvalued, which could impact placement in the S&P 500.
ReplyDeleteTesla is topic of conversation in most households today. However, Teslas are not accessible to most American consumers. Brands like Ford, GM, Toyota and others are fighting to stay in the run. Ford just released their new electric truck, Toyota has two completely electric vehicles (three if you include the prius), and GM has released several electric cars from their various brands. With more accesible and familiar brands releasing more and more electric vehicles, I think it is likely that Tesla has some competition ahead. I would expect by 2025 that majority of the leading car brands will have released a compeltely electric vehicle. However, Tesla does have the luxury element that sets them apart.
ReplyDeleteI think that other more established car manufacturers will find ways to create the same car as Tesla for a much cheaper price. I think that Tesla will eventually face stiff competition in the market. Hopefully, Tesla prompts other companies to begin to save the environment.
ReplyDeleteI agree with Libby that they are a unique brand and the company will continue to grow into the future. I personally am a fan of Tesla and their drive for reusable energy. Eventually there should be more competition hopefully bringing down the price and making it more affordable.
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