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Let's Talk Tesla - Part 1

This is going to be the first part of me talking about Tesla. I say this because I am extremely biased on this company and its creator. Do own 5 shares of this company at a price of about $540 a share I believe. This is a little hard to calculate because I own some in my Roth account and then also in my long term holds.

Tesla, the car everyone wants, the future of the automobile industry, and Elon Musk's personal hobby company. I get a lot of people don't like Elon Musk as he is the richest man in the world, and he runs his companies in a way that makes people afraid of owning them, but to me personally he is one of my idols.

Tesla has the largest market cap of any automobile company currently. There are a number of reasons for this, but honestly a lot of them are hard to prove without understanding the kind of company that Tesla is. Real quick let's talk about P/E ratios. A P/E ratio is a way of measuring how much a companies stock price mirrors what the company earns per share. That is what P and E stand for, earnings per share. This isn't the best way of looking into a companies financials but can be a good indicator of if a stock is way over/under valued. A good P/E ratio sits around the 20-25 mark. Lower than that means they are making a lot of money per share, and higher than that can be the price is inflated or, like in Tesla's case, that the future of the stock looks very bright to investors.

For Tesla, the reason the P/E ratio is so high, and that the stock price is so inflated for a car company, is that most people don't think Tesla is going to be only a car company in the future. In fact many people don't believe it to be one now, with all of the technology they create and implicate, they are seen as more of a tech company which changes how they are valued. Tesla is also a very futuristic company as the U.S. and Chinese governments push for all electric vehicles to be implemented in order to reduce of use/need of fossil fuels. Another reason Tesla is way above the typical evaluation of a stock in its class. People think of the future being all electric, and want to get in on the ground floor with the leading producer of electric vehicles.

The reason the post today is about Tesla is because their earnings came out. They did report some good news but it mostly was where they and financial analysts expected them to be. Also they announced that they sold 75% of their Bitcoin, which totaled to about 935 MILLION DOLLARS. Yeah they took a bad loss on their Bitcoin investment, but it was still an interesting play in my opinion. I am far from a Crypto fan too, so that says something. Regardless I advise everyone to look into their stocks more, see that P/E ratio and try to understand what it means! We will be talking more fundamentals of companies on here because it helps me learn about them also. ALSO TESLA FOREVER ELON IS KING! Have a good Friday Y'all.


Here is the Tesla Roadster