Ron Baron’s 2030 Tesla Stock Price Target (Ep. 695)
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- Опубликовано: 10 июн 2024
- What do you think of Ron Baron’s $4.5 trillion price target for Tesla by 2030-2032?
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What I really admire about Ron Baron is that even though he's twice my age, he still thinks long-term and remains euphoric. The same goes for Warren Buffet, by the way. Dave, please keep up the good work and don't pay attention to the short-term trolls and their short-term noise. I'm a HUGE Tesla fan, long-term investor and I love your channel!
Samer here. In it for the long term, agree with your thoughts!
I’m 82 and despite my concerns about Twitter I’m long on Tesla, hoping it creates significant wealth for heirs!
Still with Tesla stock, investors can never be sure what will happen next, bearish periods ultimately establish a new set of stocks to buy and watch while setting the stage for a robust new uptrend. I have been reading articles of people that grossed profits up to $250k during this crash, what are the best stocks to buy now or put on a watchlist?
It’s precisely at times like these that investors need to be on guard against the next certainty. You don’t have to act on every forecast, hence i will suggest you get yourself a financial-advisor that can provide you with entry and exit points on the shares/ETF you focus on.
The uncertainties accompanying this present market is more reasons I have my daily investment decisions guided by a portfolio-coach seeing that their entire skillset is built around going long and short at the same time, both employing profit-oriented strategy and laying off risk as a hedge against the inevitable downtrends, coupled with the exclusive analysis, it's quite impossible not to outperform. Netted over $550k in return on investment, since using a coach for about 2years.
@@brooksaugust4380 Glad to have stumbled on this conversation. Please can you leave the info of your investment advisor here? I’m in dire need for one.
Sure, the investment-advisor that guides me is Sandrine Nadege Logan, she popular and has quite a following, so it shouldn't be a hassle to find her, just search her
Thank you for this tip. it was easy to find your coach. Did my due diligence on her before scheduling a phone call with her. She seems proficient considering her résumé.
Good analysis. However, I would emphasize energy market disruption more that you appear to here. Growth of 150% from here is nothing to sneeze at. The TAM is huge and Tesla is in the pole position on an S curve that is about to go hyperbolic. Yes, it can look smaller in comparison to Robo-taxi or Optimus in terms of possible future opportunity. But I would argue it's more certain than those at this point. Musk himself has made this point a few times when he says that Energy will eventually be at least as big as the Auto business. And when he includes Saudi Aramco with Apple as a way of setting the valuation goal in a few years - it reiterates this intent. Tesla has proven leadership with tech and manufacturing capacity just now coming on line to position them as the primary disrupter in Energy in the next few years......
He clearly said his PT is based on EV alone :)
Energy storage is the key to the transition to renewable energy. When this becomes understood then big oil will become a small blip in the rearview mirror. Energy storage will become the new king of worldwide energy.
Retail consumers can be fickle, so I agree that the car market is a bigger risk than the energy business. For the energy sector only the numbers matter. Megapacks have already proven themselves to be automatic profit. Tesla can sell every megapack it can make for the next many decades. As close to guaranteed profit as you could ever find. Go Tesla!
Absolutely. Not unheard of for energy to reach a massive scale dependent on:
-competitors ( highly unlikely they can undercut tesla. Provide tesla quality. Wait times under tesla. Won’t be in the game as long )
-tesla in house battery supply. Or what they can get from suppliers
-scaling new factories and when
The demand to replace peaker plants / off grid communities ( islands ) / Backup for critical storage facilities is off the charts. Then when older mega packs get replaced they buy new version from tesla and tesla recycles most material at a prolly 60-75% reduction in first cost. So the revenue will only go up as the older ones are replaced. Double dipping on the customer as I like to say
They can sell for as long as the eye sees until there is the next major disruption no one can calculate as all we have is solar. Wind. Batteries for the foreseeable future.
Along with the more power packs are deployed as well the stickiness of the brand will entrench itself into being one of the biggest energy giants of the future. Unfortunately solar is bunk side of business but not everything can have mega margins
I absolutely agree! EVs, FSD, and Optima are exciting future prospects but Tesla energy is most needed, most under discussed, and shows the most immediate potential for growth.
Ron Barron is a very level headed investor with a significant track record.
Based on my "Napkin Math" I believe that Ron's numbers are base case as my bull numbers are significantly higher...
For sure.
No mention of energy which has a 10x TAM over automotive... Tesla will be massive.
As always, good explanation of stock napkin evaluations. Couple of missing items from the calcs are Solar (panels plus batteries) and perhaps the most important is energy efficient HVAC systems. Elon has mentioned it many times and that will be an easy business for Tesla to get into as they have done remarkable things with the cars heating/cooling system and scaling that up to residential is a no brainer. Bundle it with a Tesla Solar install and run it through the Tesla App it could be huge for Tesla.
what was hos forecast for end 2022
Classic Dave Lee, brilliant assessment. Tesla is the closest you can get to a sure thing in 10x investing.
Mercedes has margins of 28% and trades at PE of 8. Interest rates will revert to 1980s at 7% and EV auto will be valued at 8 PE. In 2023, Tesla will go cash flow negative. Why? CCP banning sales within China when class action court case of racism against black workers suing Tesla and the directors. Another lawsuit by American Chinese investor suing the board of directors for abetting racism on blacks and hispanics.
"sure thing" Hahaha, running away...
Dave HERE.
Baron math way underestimating on that napkin.
Thanks Dave I’ll buy more dip
Thank you for sharing, Dave! I can’t wait to see all of those S-curves feed into one another. Going to be a truly amazing decade ahead.
Wonderful explanation of "napkin math" and why it matters. Especially loved how you showed how the numbers work while still excluding everything that can have an even greater impact. Fun to see.
I remember that a couple of months ago Ron was expecting Tesla to 3X by 2030. My best guess is that the 6X to 7X new stock price prediction involves some inside information by Elon regarding FSD and robotaxi.
Or due to the stock price drop since then?
@@darbkavon Part of it, yes. But mostly something to do with FSD
True true. Ron was on the inside since he first invested into Elon. Elon knows his support goes way back. Thus I’m sure he has some India’s info of the new products in works and Ron crunching numbers can easily see why he talks about tesla
Used car sales and charging stations grid tied will be huge as well.
Great summary! If Tesla fails in everything but EVs, it will still be a tremendous investment. Tesla has a huge lead in FSD, Robotaxi, energy, GAI, and Optima. If it succeeds in even one - let alone several - then a Tesla investment will grow even faster.
Yep the only problem with FSD is it’s not anything it claims to be !
@@Bikes0420 let's see what the claim from Tesla is...
_"Autopilot is an advanced driver assistance system that assists your car with steering, accelerating and braking for other vehicles and pedestrians within its lane. It assists with the most burdensome parts of driving and work alongside features like emergency braking, collision warning and blind-spot monitoring._
_With Full Self-Driving (FSD) capability, you will get access to a suite of more advanced driver assistance features, designed to provide more active guidance and assisted driving under your active supervision._
_These features are designed to become more capable over time; however the currently enabled features do not make the vehicle autonomous. The currently enabled features require a fully attentive driver, who has their hands on the wheel and is prepared to take over at any moment."_
Judging various videos on RUclips, the claim is fairly accurate. Judging from the most recent videos, FSD beta is highly improved over the years.
What Ed or Harriet meant is that even without FSD, Robotaxi, Energy, GAI or Optimus, TSLA is a great investment. So I don't understand why you think FSD beta is the problem, even when you think it won't be complete in the end..
Imagine charging your Tesla during off peak hours and selling it back during on peak lol passive income
Until everyone is doing it then the deferential will approach zero.
And you car has a set amount of cycles, might not want to waste those...
Ron is brilliant. I think it's fair to say that his vast experience leads him to approaching the valuation just based on vehicles and anything else welcomed a great plus.
I, however, do leave Optimus out but can't think of the mid term future of Tesla without thinking batteries and FSD. It's a priority right now as stated on the last earnings call. I wonder what Ron would think of Steven Mark Ryan's 2030-2035 targets? 😆
Hey Dave, I like your short analyses of the most important contants about Tesla‘s business very much. There you Talk a lot about FSD and the bot‘s possible future revenue and Profit.
What I miss is how you think about Tesla’s energy revenue and Profit in the future. That’s only marginally mentioned. But I think there will be a lot of revenue and profit before FSD and bot are ready. I would be interested how you do think about that.
By the way, I‘m from Germany and love your Country. We visited a lot of your National Parks and where excited. Beautiful Places! So now I was a but jealous about your long journey last Summer.😉
My calculations: 20M cars @ 35K ASP @30% = 210B * 20 PE is 4.2 Trillion Market 🧢 hope this solves the equation not including all other options like energy, bot etc.
Assuming the world economy recovers that PE should be conservative. I also always make conservative long run assumptions. They're sufficient to still get the largest market capitalisation of any company.
The whole premise depends on the 20 million sales. That’s a very long period of sustained, massive growth. That’s the part of the equation that’s suspect, in my mind. A hell of a lot can, and probably will, happen in that period of time. I own 3,000 shares and two cars.
@@thefish5861 if they're still growing like that in 2030, the p/e will be far higher than 20. Coke currently has a p/e of 24.
TAM for megapack batteries is HUGE. Tony Seba states 100 hours of battery storage typically needed to just have intermittent solar and wind. This equates to 2 million megapacks just for the UK market. Take a look at this
Where did the 20x multiple come from?
If you consider that Tesla will also be selling Semis, vans, and other commercial vehicles, along with consumer passenger vehicles, a $50K average selling price per vehicle is probably reasonable. The fleet average price will be higher due to commercial vehicles.
Ford has been selling tens of millions of vehicles for decades… around the globe… and their stock price hasn’t been able to climb over $20 per share for 20 years.
And that's without any share buybacks right?
Well said Dave I think napkin maths is very fundamental in understanding businesses which are moving at such a fast pace it gives you insight every quarter and every year to readjusted reanalyse your Stants on a company.
I particularly like your napkin meth in terms of how many test vehicles will you own off the production line.
This company has so much upside potential I really need to find out new ways how to earn extra income just to increase my share of the company.
love your #Tesla videos
I’m a long term Tesla stock holder and I have one criticism of your channel. You never talk about the negative sides of Elon or Tesla.
It’s like being stuck in an echo chamber sometimes.
I think Tesla fanboys biggest mistake (and im a fan) is that they never look at the competition. Its almost like they think Tesla will be the only player in all its fields. And the market of electric cars, self driving, battery tech, robotics, general AI will have so much competition. Everyone is pouring billions onto it. Entire countries. I mean China is super focused on electric cars, renewables tech and AI. They will flood the market.
@@BoStanfordify I agree. As investors, ALL of the information is vital, positive or negative. I’d also like a video on Elon’s volatile nature. The man is a genius but unpredictable to say the least.
Why not get the bearish perspective from actual bears? There is no shortage of them. Diversifying your sources is better than asking a bull to pretend at being a bear.
You can find trash channels elsewhere
It does seem weird that clearly intelligent, even brilliant commentators are turning a blind eye to the reputational and operating risk posed by Elon’s impulsiveness. Twitter was clearly a mistake, and now is an albatross around Tesla shareholders’ necks. Btw, been a huge fan of TSLA and its mission since 2009-so I’m not a hater or FUDster.
Agree...
Even with a 10 multiple and only its car production Tesla could be a 3x compared to todays share price. That's a great investment. Anything else is icing on top of the cake!
Mercedes has margins of 28% and trades at PE of 8. Interest rates will revert to 1980s at 7% and EV auto will be valued at 8 PE. In 2023, Tesla will go cash flow negative due to CCP banning sales within China when class action court case of racism against black workers suing Tesla and the directors. Another lawsuit by American Chinese investor suing the board of directors for abetting racism on blacks and hispanics.
Nobody wants to model FSD. But something could be worked out. IE: A level 4 system is not that far and could be used as a bear case. How much would people pay for level 4?
Why there is no LIKE bottom?
how come no multiplication or subtraction?
Great video Dave. I prefer your napkin math over Ron Barons. I like that you both exclude FSD, Robotaxis, energy, and Tesla Bot, and that you both assume a conservative PE by 2030. I base my investment on this approach and hope to enjoy upside surprises on those Tesla Options. 😊
I think the ASP was high glad you did a lower expense. And just over $200 a share right now -madness! 🤩 but I'm still buying! So long term this is such an amazing opportunity
What is the bear case scenario? Ron’s bull, Dave’s base, what about bear numbers?
Intelligent speculation. Hope everything comes true.
I have to agree with Jeff that the valuation of Tesla's energy business is completely underestimated by a factor of 10.
The need to upgrade electrical grids and implement renewable energy solutions is being seriously understimated. Just look at the need in places like South Africa, South America, South East Asia and the South Western US for starters.
Think of the demand for residential solar and battery storage on a global scale between now and 2030.
I think, wake me in 10 years
Does anyone know how to calculate those multiples? I'm just a newbie and want to learn. Thanks
that is the PE ratio...
Ron uses 15X, Dave 20X, Isn't the car industry more like 10X
Drink everytime dave says "napkin math"
I am convinced that energy will be huge. More and more research show that we can make it on solar and wind power, but huge amount of batteries will be needed. When Tesla a start to produce their own LFPs, they can really ramp up the energy side.
In January of this year, Dave Lee forecast a 2022 trading range for TSLA (pre 3:1 split) of $900 - $2,200. I could count of my fingers the number of days it traded above $900 and today it trades below $600. Why is Ron Baron’s forecast any more reliable?
Another problem with "napkin math" is random error introduced into the model by pasta stains.
LOL, use a clean napkin for bullish results
Wasn't TSLA going to be 10x in 8-10 years when the stock price was around $900-$1000? And it's only going to be 7x in 8-10 years when the stock price is only around $600 pre-split? Isn't it downgrading then?
AI and Dojo: Tesla's AI business is also undervalued. The AI product by itself is a compelling product on its own. When you pair Tesla's AI software with the Dojo hardware you have a solution that would be useful in so many applications that it boggles the mind. If Tesla were to build AI + Dojo suits for the commercial market I and sure it would see hundreds of units. Maybe thousands. Tesla could make high margins selling time on Dojo for small organizations who cannot afford to by the full package. Again I think this is something that you should model.
Hey thanks Dave, I've posted in your channel the "napkin maths" and 5T dollar valuation for Tesla months before Baron yet you quote Baron instead of quoting me.. 😅
Thanks Dave.. appreciate “napkin math” as opposed to “back of the napkin math”. Rubes who say that really mean “back of the envelope math”.
So the 2030 price target is only based on auto sales?
Part Deux: in my humble opinion Tesla should be building another five battery factories in stratigic global locations like Austrailia, Canada, the UK, the Middle East and somewhere in Africa just to meet the prospective demand.
I would suggest that you ask someone to build a model showing the possible demand for energy products in emerging markets so you can make better predictions for your own channel.
Right from the get-go...if "Tesla sells 20 million cars a year in 2030." There is no reason to think that this is even possible. The Tesla perma pumpers just repeat it over and over and over again like its likely. Its not. It is virtually impossible to happen.
Thanks Dave
For true basic napkin this is fine. Reality will be much higher from an overall product portfolio of tesla. So the 20M @ 50k is more a base number. 20M might be lower but fsd, solar/batteries, robotaxi and robot will catapulte tesla to levels hard to believe at this time
To me that’s a impossible bear case.
The last 10 years have showed us what kind of beast Tesla is: pushing engineering, integration, getting into completely different industry(batteries) and dominating almost right away.
I have no reason to expect slowing down or complacency. We will see the same techniques and improvement but with more and more means and audacity.
I think we can almost extrapolate their profit curve and expect it to continue for a while.
As Musk goal is to help humanity, there is no stop point, no good enough.
I don’t know where it will stop, but I expect a few more surprises.
@@brunoheggli2888 Hahaha
Go short it and have fun!
All these numbers are quite aspirational. Look how long it's taken for Berlin and Texas to even begin ramp ups. Also what about competition? Even if Tesla remains the best EV company going forward, there's going to be competition galore so 20 million seems high. Also Tesla bulls are talking about full autonomy and robo-taxis. Even the current FSD beta is nowhere near ready for true FSD.
Then there is the issue of battery supply, mining enough metals etc. Will Tesla have sufficient supplies of minerals and other basic materials for 20 million cars? I hope all this comes through but I'm skeptical.
I think it will be around 100-299 billion market cap by 2030
So 4 trillion valuations around 650 a share ?
Moooore :)
🙏🏼
Even with a very conservative number 15m (30% growth over 8 years) at 20% margin, ASP 35K, 20P/E, the Mcap will be 2.1T. apply 12% discount over 8 years, the present value ~ 850B. 35% higher than today's valuation.
🤯 it's a buy from me.
Not a buyer in this economic market, especially with TSLA showing a huge head and shoulders in the price action… looking to buy in the mid to upper $100 price action
i am just wondering, is napkin math a product of QE decade......
And then there's Tony Seba who does the S Curve maths. oO
15K by 2030!
How many plants need to be built to deliver 20m cars and how long will it take to build and operationalize those? Also, People make the mistake of assuming a single EV market worldwide. That is not the case. There are 3 distinct markets - US, Europe (loosely) and China. I see 25% market share in US. I don’t see Tesla’s market share in China or Europe being 25%.
You meant 3 to 8 yrs not 5 to 10 ?
nice to hear in the doom and gloom
I know Dave is not actively buying TSLA these days, but the fact that he's still holding on to his shares despite of his massive gains tells me he'd buy the stock at today's valuations because of the incredible trajectory the company is on. @DAVE LEE Looking ahead the next 10 years... do you see more potential and less risk for Tesla in 2022 than you did in 2012 ?
I can't speak for Dave, but I certainly think that there's less risk now. When I bought in 2018, I really hoped that Tesla would succeed, but I was prepared to lose my investment. I don't worry about that anymore. I have no idea what the future price will be.
@@JohnPMiller I watched the Elon Musk show, those who held thru 2018 are the real OGs.
The futurist; TSLA undervalued
The myopic; TSLA overvalued
FSD napkin math should look at the long term horizon, when competition is abundant and a basic FSD is a student project. Say 15 years from now. Fleet cars would likely have a 100% maybe 150% markup, compared to the current 50%. So profits could triple, long term.
only 1400? Anyone else seem to think that low? i was thinking more like 4-5k at least..
Yes there are hyper bulls who believe that. I hope they are right
Absolutely!
If Tesla can afford $10 billion or so buybacks in say 2023. 2024, 2025.... surely the shares in issue decreases and target SP has to include this in their calculations?
This analysis does not take into account that the top producing lithium mining nations are in advance talks into forming an OPEC of lithium nations.
I see Tessa shares a lot more in 2026 , 0ver $2 k a share and rising when Tesla is in full flight
Do the same figures with margins at a more realistic 15%.
say 30 000 usd/car, but fsd, Optimus, hvacs, batteries etc... and more
Anybody can have a price target. Wishful thinking for 600 dollars share. I own A Tesla Y and the Stock, I love Tesla. If inflation disappears then tesla will soar to 600 dollars a share.
Not all of us can wait til 2030.
Although the war is beyond tragic, it will accelerate the solar/battery business.
Nobody seems to be doing napkin math for battery storage, that Elon said in last report will be growing 2-3 X per year...last quarter was 2GWh installed, do the math for 2030 even at just doubling each year with a 10% margin or even better when mass scaled ;)
So didn't include Robotaxis, Teslabot, solar, batteries etc.
Barons price target is purely on car sales.
Worth noting.
or Tesla Insurance
@@dollarbill9073 couldn't agree more.
As a Tesla investor I'm incredibly excited 😊
@@dollarbill9073 So the solar business is not yet beeing produced? Are you awake my friend? Cuzz if you are you are clearly not paying attention.....
@@kingcarlobossio7067 There's been a lot of criticism over the solar from other companies that I've seen. It's worth a closer look. What are your thoughts on the criticism from other solar companies?
@@newpersonal3762 Don't know don't care about what others are doing. This is clearly the old guard trying to save their ass*s. The new wave is here and will whip out the dinosaurs sooner or later, make sure you are on the right side...
The most successful investors do their math on fine cloth napkins.
Mass market:
I think Tesla has missed the mark on mass market EVs and on small EV trucks and delivery vehicles for under developed counties.
Just from casual viewing on RUclips I think India is going to own that segment in five years and maybe surpass Tesla in unit volume by 2030.
Well the good days are over. You can enjoy what you made or wait for more, but wait will be long.
Only $500. I think that's a little low
Gari Black : 550 $ before december 2023
Perfect example of how analysis can end up in quite different answers
@@brunoheggli2888 I suggest you sell all of your Tesla stock, and stop wasting your time watching videos about Tesla.
@@brunoheggli2888 uh huh... Ok .. sure .. maybe you should check your meds.
Why does it seem no one ever looks at the potential strict AI business Tesla could make business from? It’s huge….
A little different from Cathy Wood's $7000 price
I find Cathie Wood, and AARK invest, to be among the most credible sources on TSLA. By training and profession, I think James Stephenson offers some of the very best insights into TSLA's financials and what might be expected to develop over the next few years. Throw in a little Rob Mauer, and I think you'll have a good handle on TSLA and its trajectory.
TSLA retail investors are fortunate--many, fine resources from which to learn about the company, its direction, and its potential. And that includes David Lee.
500-600 without autonomie
You completely forgot to account for the current rate of inflation and the fact that we are more than likely entering a lost decade scenario… in this case more like 5 years. Tesla will not be 6x in 5 years unless the fed makes it happen.
Is he saying each car on average sells for $50,000 in 2030 dollars?
I don’t see how Tesla can produce 20 million cars as soon as 2030. While I hope that they do my napkin math looks like this.
Shanghai expanded and ramped 2.5 million cars same for Berlin and Texas. Fremont at 1 million
New factories built in 2025 and 2026 ramping to 2030 at 2 millionish. New factories built in 2027 and 2028 ramping by 2030 at 1.5 millionish. 2029 factory starting up at .5 mill.
Like 16 million cars which I guess is damn close enough but that is some hell of an aggressive timeline.
I feel that for the returns r not attractive enough, I rather have my bet on BTC.
20 million cars in 2030 is lunacy it will be much closer to half that
First after 2nd
Not hard to imagine pricing in line. Why do we think cars use to cost 5k at one point. Because inflation eats money everyday thus a higher price later.
Yea tesla might make a cheaper model. But it’s the same when not everyone drives a used Honda. They want the latest and greatest. Thus money will be spent. Along with the printing of millionaires everyday. They aren’t going to be buying a Kia..
No FSD = no advantage = decreasing market share and margins = much lower stock price
Regarding FSD: I don't think Tesla can claim it has truely solved level 5 FSD until a Tesla can navigate the traffic in Mumbai or at least downtown Toronto.
FSD will be great for robots taxis and premium customers but I don't think the mass market will be willing to cough up 10k or 20k for FSD.
The best use case for FSD is likely be in commercial, industrial and military applications where the ROI makes sense.
1, first!!!
#695
When Ron Baron says he thinks Tesla will 7x by 2030, you can bet the farm he has inside information that he used to make that prediction. I will guarantee you Elon has told him things that he has not told anyone else, and Ron Baron knows about future plans for Tesla. And even if it just does a 4x by 2030, that is still $800 a share, if not higher.
At $1000 a share Tesla is a $3.5 trillion dollar company. So Ron can be off a little and maybe it only does a 5x, which is still a lot.