Author Topic: Yeow! Tesla trades at 291 times its 2020 estimated PE.  (Read 883 times)

rcjordan

  • I'm consulting the authorities on the subject
  • Global Moderator
  • Hero Member
  • *****
  • Posts: 10781
  • Debbie says...
    • View Profile
Yeow! Tesla trades at 291 times its 2020 estimated PE.
« on: December 09, 2020, 05:31:58 PM »

ergophobe

  • Inner Core
  • Hero Member
  • *
  • Posts: 6225
    • View Profile
Re: Yeow! Tesla trades at 291 times its 2020 estimated PE.
« Reply #1 on: December 09, 2020, 08:10:44 PM »
I always read stuff like that and think it's crazy and those valuations can't hold, and I feel like in most cases since 2001, I've been wrong (Amazon, Google).

BoL

  • Inner Core
  • Hero Member
  • *
  • Posts: 957
    • View Profile
Re: Yeow! Tesla trades at 291 times its 2020 estimated PE.
« Reply #2 on: December 09, 2020, 09:06:25 PM »
>Google

Indeed. Where did they start, somewhere between $50 and $80? In hindsight it all seems obvious.

littleman

  • Administrator
  • Hero Member
  • *****
  • Posts: 5405
    • View Profile
Re: Yeow! Tesla trades at 291 times its 2020 estimated PE.
« Reply #3 on: December 09, 2020, 09:38:15 PM »
I just hate tech stocks their valuation always breaks my brain.

ergophobe

  • Inner Core
  • Hero Member
  • *
  • Posts: 6225
    • View Profile
Re: Yeow! Tesla trades at 291 times its 2020 estimated PE.
« Reply #4 on: December 09, 2020, 10:14:20 PM »
So... money is a story. US money makes that very clear - the cost to make a $1 bill and a $100 bill is basically the same, the size is the same, the color is the same. It's just minor variations in artwork and a tweak to the number. What makes the valuations differ by 100x is just the story we tell about those pieces of paper.

Stocks values are also based on the story we tell about those companies that says: "Well, the company earns this much, has this much in capital assets, spends this much and it seems like the demand for their product is steady/rising/declining, so it seems like the future value is X."

The problem for me is that though, I think of myself as very optimistic about my personal life, I am not optimistic on a macro scale, so the story I tell just can't see the "rising coefficient" as big as it sometimes is. Of course, I would guess that many of the people who saw it for Google and Tesla, also saw it in other places where values collapsed (were they greedily awaiting the WeWork IPO?).

So I've missed out on big gains and big losses. I'm not sure if I would have more money or less if I were more daring. I think less, because I mostly find studying individual stocks and the stock market in general to be utterly boring and I would rather do other things with my time. So I don't have the knowledge to make good decisions and daring in the absence of knowledge seems like a bad combo. But perhaps if I had sucked up the unpleasantness and studied stocks more closely, I would have had more free time younger. Who can say?
« Last Edit: December 09, 2020, 10:21:13 PM by ergophobe »

Rupert

  • Inner Core
  • Hero Member
  • *
  • Posts: 2821
  • George in a previous life.
    • View Profile
    • SuitsMen
Re: Yeow! Tesla trades at 291 times its 2020 estimated PE.
« Reply #5 on: December 12, 2020, 07:44:06 AM »
Quote
I would have more money or less if I were more daring.

More... the Market always goes up :)
... Make sure you live before you die.

ergophobe

  • Inner Core
  • Hero Member
  • *
  • Posts: 6225
    • View Profile
Re: Yeow! Tesla trades at 291 times its 2020 estimated PE.
« Reply #6 on: December 12, 2020, 05:00:31 PM »
>>More... the Market always goes up :)

I know that's a joke, but I have always bet on the market going up (as per discussions here where I was told I had lost my mind back in March or April). So I have overwhelmingly had my savings in index funds.

What I mean is when people say this individual stock or that individual stock is going to get a huge return. Like for example, people told me I really should get into Bitcoin. To me it seemed late. it was at $12000. It soon dropped below $4000. But now it's over 18,000. So that person was right. I would have had 50% return in three years if I bought then and sold today.

But as I say, the problem is that if I owned bitcoin, I would need to pay attention to bitcoin and I have absolutely no desire to spend the brain cycles I have available to me studying bitcoin.

buckworks

  • Inner Core
  • Hero Member
  • *
  • Posts: 1309
    • View Profile
Re: Yeow! Tesla trades at 291 times its 2020 estimated PE.
« Reply #7 on: December 12, 2020, 08:08:06 PM »
>> absolutely no desire to spend the brain cycles I have available

That relates to Warren Buffet's advice to only invest in things you understand.

ergophobe

  • Inner Core
  • Hero Member
  • *
  • Posts: 6225
    • View Profile
Re: Yeow! Tesla trades at 291 times its 2020 estimated PE.
« Reply #8 on: December 14, 2020, 05:07:00 PM »
>>Warren Buffet...

But I go a step further. I do not buy individual stocks. I own a couple from way back, but I have not *bought* one since the Exelixis IPO (where I doubled my money, but unfortunately only had $1500 to put into it). That company was founded by my wife's graduate advisor and was based on research that came out of that lab and we knew a lot of the scientists in the company.

So I've missed out on big gains and big losses.

And here you go...

They Ignored Or Deleted The Email From Airbnb. It Was A $15,000 Mistake
https://www.npr.org/2020/12/12/945871818/they-ignored-or-deleted-the-email-from-airbnb-it-was-a-15-000-mistake

Airbnb Now A $100 Billion Company After Stock Market Debut Sees Stock Price Double
https://www.npr.org/2020/12/10/944931270/airbnb-defying-pandemic-fears-takes-its-company-public-in-ipo

Did I think Airbnb was going to go up a lot or just hold steady or go down upon IPO? No, I didn't think any of those things. I saw the email, said, "I don't buy individual stocks," and thought about it no further. If you had asked me, though, I would have guessed the stock would not double.

So again, even though I have a really, really good understanding of this product and have been amazed at the market domination they have achieved, I don't buy individual stocks. It's not something I want to devote brain cycles to, even when I do understand the product.
« Last Edit: December 14, 2020, 07:17:33 PM by ergophobe »