> If Tesla was valued fairly

I think it's a wrong mental model to think of stock market value as "fair" or "unfair" (or maybe it's just me thinking of "unfair" when I see the word "fair").

My impression is that if Tesla would be valued based on quantifiable things it would be much much lower (production costs, competition, revenues, potential, etc.). Of course, you shouldn't value something only based on quantifiable things, but in Tesla the "wishful thinking" part seems to be much larger than for others.

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johnmaguire 4 hours ago | parent | next [-]

I assume OP meant something closer to "fair market value" than "fair vs. unfair." Tesla is not priced according to its underlying assets or technical analysis (e.g. P/E ratio), but solely based on hype/sentiment.

Interestingly, retail investors and company insiders collectively own more of Tesla than institutional investors.

	▲	marcusverus 3 hours ago \| parent [-]
		Fair market value: the price at which a thing would change hands between a willing and informed buyer and seller. A company's market cap is, by definition, its fair market value. > Tesla is not priced according to its underlying assets or technical analysis (e.g. P/E ratio), but solely based on hype/sentiment. You're right that it's not priced according to underlying assets, but it doesn't follow that it is priced on vibes. Its price is based on potential future earnings; the expectation that Elon can pull off his plans for a robotaxi fleet or building an Optimus robot that might unlock the massive demand for household and/or general use commercial robots. Both offer the prospect of being the first mover into markets which could be worth trillions. It's speculation, sure, but not mere "vibes". The company is also led by a man who has made and delivered on massive, seemingly impossible promises, which adds credibility to the idea that Tesla might actually bring these markets into existence.

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3 hours ago | parent | prev | next [-]

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therealdkz 2 hours ago | parent | prev [-]

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