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Assuming that Tesla increases its share of the automotive market to 10% (from 2%) and other assumptions, the expected return of an investment in the company over the next five years is negative 24%, which equates to an annual return of negative 4%. In other words, an £100,000 investment in the company is expected to return £76,000 in five years time.
Assuming that Tesla increases its share of the automotive market to 10% (from 2%) and other assumptions, the expected return of an investment in the company over the next five years is negative 24%, which equates to an annual return of negative 4%. In other words, an £100,000 investment in the company is expected to return £76,000 in five years time.


The degree of risk associated with an investment in Tesla is 'high', with the shares having a beta that is 112% above the market (2.12 vs. 1). Furthermore, Tesla's shares exhibit a 'high' level of liquidity, as evidenced by its bid-ask margin of 0.0297%.
The degree of risk associated with an investment in Tesla is 'high', with the shares having a beta that is 112% above the market (2.12 vs. 1).


Accordingly, based on the assumptions provided on the Stockhub platform,  an investment in the company is considered to be a 'suitable' one for you if, among other criteria, your required:
Accordingly, if your desired annual rate of return is negative 4% or less and/or one of your goals is to accelerate the world's transition to sustainable energy (i.e. you share in the mission of the company), and you are both willing and able to accept the possibility of losing your entire investment amount, then an investment in the company is considered to be a 'suitable' one.
* Return level is negative 4% per year or less in absolute terms;
* Risk level is 112% or more above the market risk level;
* Time horizon is five years or longer;
* Bid-ask margin is 0.0297% or more; and/or  
* Objective is to help accelerate the world's transition to sustainable energy.


'''Fun fact:''' Tesla, Inc. was named after inventor Nikola Tesla and was founded in 2003 by Martin Eberhard and Marc Tarpenning, not Elon Musk, who joined later as an investor and chairman.
'''Fun fact:''' Tesla, Inc. was named after inventor Nikola Tesla and was founded in 2003 by Martin Eberhard and Marc Tarpenning, not Elon Musk, who joined later as an investor and chairman.
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==== All periods ====
==== All periods ====
{| class="wikitable"
{| class="wikitable"
|+Financials<ref>Source: Stockhub Limited</ref><ref group="Note" name="Note04" /><ref>Source: Stockhub Limited</ref><ref name="Note04" group="Note" />
|+Historic financials<ref>Source: Stockhub Limited</ref><ref group="Note" name="Note04" />
|-
|-
!Year  
!Year  
Line 617: Line 612:
!'''17'''
!'''17'''
!18
!18
!18
!19
!20
!21
!22
!23
!24
!25
!26
!27
!28
!29
!30
!31
!32
!33
!34
!35
!36
!37
!38
!39
!40
!41
!42
!43
!44
!45
!46
!47
!48
!49
!50
!51
!52
!53
!54
!55
!56
!57
!58
!59
|-
|-
|'''Year end date'''||'''31/12/2005'''||'''31/12/2006<ref name=":12">{{cite web|url=https://www.mercurynews.com/2014/07/14/2006-san-carlos-start-up-tesla-seeks-sexier-electric-car/|title=2006: San Carlos start-up Tesla seeks sexier electric car|date=July 14, 2014}}</ref><ref name="SEC">{{cite web | url=https://www.sec.gov/edgar/browse/?CIK=1318605 | title=Tesla, Inc. TSLA on Nasdaq | publisher=[[U.S. Securities and Exchange Commission]]}}</ref>'''||'''31/12/2007'''||'''31/12/2008'''||'''31/12/2009'''
|'''Year end date'''||'''31/12/2005'''||'''31/12/2006<ref name=":12">{{cite web|url=https://www.mercurynews.com/2014/07/14/2006-san-carlos-start-up-tesla-seeks-sexier-electric-car/|title=2006: San Carlos start-up Tesla seeks sexier electric car|date=July 14, 2014}}</ref><ref name="SEC">{{cite web | url=https://www.sec.gov/edgar/browse/?CIK=1318605 | title=Tesla, Inc. TSLA on Nasdaq | publisher=[[U.S. Securities and Exchange Commission]]}}</ref>'''||'''31/12/2007'''||'''31/12/2008'''||'''31/12/2009'''
|'''31/12/2010<ref name="SEC" />'''
|'''31/12/2010<ref name="SEC" />'''
|'''31/12/2011<ref name="SEC" />'''
|'''31/12/2011<ref name="SEC" />'''
|'''31/12/2012<ref name="SEC" />'''
|'''31/12/2012<ref name="SEC" />'''
|'''31/12/2013<ref name="SEC" />'''
|'''31/12/2013<ref name="SEC" />'''
|'''31/12/2014<ref name="SEC" />'''
|'''31/12/2014<ref name="SEC" />'''
|'''31/12/2015<ref name="SEC" />'''
|'''31/12/2015<ref name="SEC" />'''
|'''31/12/2016<ref name="SEC" />'''
|'''31/12/2016<ref name="SEC" />'''
|'''31/12/2017<ref name="SEC" />'''
|'''31/12/2017<ref name="SEC" />'''
|'''31/12/2018<ref name="SEC" />'''
|'''31/12/2018<ref name="SEC" />'''
|'''31/12/2019<ref name="SEC" />'''
|'''31/12/2019<ref name="SEC" />'''
|'''31/12/2020<ref name="SEC" />'''
|'''31/12/2020<ref name="SEC" />'''
|'''31/12/2021<ref name="SEC" />'''
|'''31/12/2021<ref name="SEC" />'''
|'''31/12/2022'''
|'''31/12/2022'''
|'''31/12/2022'''
|-
|'''31/12/2023'''
| colspan="18" |<div style="text-align: center;">'''Income statement'''</div>
|'''31/12/2024'''
|
|'''31/12/2025'''
|-
|'''31/12/2026'''
|Revenues ($'million)|| 0||0||0.073||15||112
|'''31/12/2027'''
|117
|'''31/12/2028'''
|204
|'''31/12/2029'''
|413
|'''31/12/2030'''
|2,013
|'''31/12/2031'''
|3,198
|'''31/12/2032'''
|4,046
|'''31/12/2033'''
|7,000
|'''31/12/2034'''
|11,759
|'''31/12/2035'''
|21,461
|'''31/12/2036'''
|24,578
|'''31/12/2037'''
|31,536
|'''31/12/2038'''
|53,823
|'''31/12/2039'''
|81,462
|'''31/12/2040'''
|-
|'''31/12/2041'''
|Net profits ($'million)||style="color: red;" |-12||style="color: red;" |-30||style="color: red;" |-78||style="color: red;" |-83|| style="color: red;" |−56
|'''31/12/2042'''
|style="color: red;" |−154
|'''31/12/2043'''
|style="color: red;" |−254
|'''31/12/2044'''
|style="color: red;" |−396
|'''31/12/2045'''
|style="color: red;" |−74
|'''31/12/2046'''
|style="color: red;" |−294
|'''31/12/2047'''
|style="color: red;" |−889
|'''31/12/2048'''
|style="color: red;" |−675
|'''31/12/2049'''
|style="color: red;" |−1,962
|'''31/12/2050'''
|style="color: red;" |−976
|'''31/12/2051'''
|style="color: red;" |−862
|'''31/12/2052'''
|721
|'''31/12/2053'''
|5,519
|'''31/12/2054'''
|12,556
|'''31/12/2055'''
|-
|'''31/12/2056'''
| colspan="18" |<div style="text-align: center;">'''Balance sheet'''</div>
|'''31/12/2057'''
|
|'''31/12/2058'''
|-
|'''31/12/2059'''
|Total assets<br />($'million)
|'''31/12/2060'''
|8
|'''31/12/2061'''
|44
|'''31/12/2062'''
|34
|'''31/12/2063'''
|52
|130
|386
|713
|1,114
|2,417
|5,831
|8,068
|22,664
|28,655
|29,740
|34,309
|52,148
|62,131
|82,338
|-
|-
|
| colspan="18" |<div style="text-align: center;">'''Other'''</div>
|'''Historic'''
|'''Historic'''
|'''Historic'''
|'''Historic'''
|'''Historic'''
|'''Historic'''
|'''Historic'''
|'''Historic'''
|'''Historic'''
|'''Historic'''
|'''Historic'''
|'''Historic'''
|'''Historic'''
|'''Historic'''
|'''Historic'''
|'''Historic'''
|'''Historic'''
|'''Historic'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|'''Forecast'''
|
|
|-
|-
| colspan="61" |<div style="text-align: center;">'''Income statement'''</div>
|Employees
|-
|NA
|Revenues ($'million)|| 0||0||0.073||15||112
|70
|117
|268
|204
|252
|413
|514
|2,013
|899
|3,198
|1,417
|4,046
|2,914
|7,000
|5,859
|11,759
|10,161
|21,461
|13,058
|24,578
|17,782
|31,536
|37,543
|53,823
|48,817
|81,462
|48,016
|$78,935
|70,757
|$112,257
|99,290
|$154,816
|127,855
|$207,049
|}
|$268,527
 
|$337,721
=== Forward ===
|$411,894
 
|$487,157
====What are the financial forecasts?====
|$558,739
{| class="wikitable"
|$621,448
|+Forward financials<ref>Source: Stockhub Limited</ref><ref group="Note" name="Note04" />
|$670,282
|-
|$701,078
!Year
|$711,102
!18 !!19!!20!!21!!22
|$699,445
!23
|$667,163
!24
|$617,116
!25
|$553,551
!26
|$481,510
!27
|$406,171
!28
|$332,253
!29
|$263,564
!30
|$202,749
!31
|$151,247
!32
|$109,414
!33
|$76,757
!34
|$52,217
!35
|$34,448
!36
|$22,038
!37
|$13,673
!38
|$8,226
!39
|$4,799
!40
|$2,715
!41
|$1,490
!42
|$793
!43
|$409
!44
|$205
!45
|$99
!46
|$47
!47
|$21
!48
|$9
!49
|$4
!50
|$2
!51
!52
!53
!54
!55
!56
!57
!58
!59
|-
|-
|Gross profits ($'million)
|'''Year end date'''||'''31/12/2022'''||'''31/12/2023'''||'''31/12/2024'''||'''31/12/2025'''||'''31/12/2026'''
|
|'''31/12/2027'''
|
|'''31/12/2028'''
|
|'''31/12/2029'''
|
|'''31/12/2030'''
|
|'''31/12/2031'''
|
|'''31/12/2032'''
|
|'''31/12/2033'''
|
|'''31/12/2034'''
|
|'''31/12/2035'''
|
|'''31/12/2036'''
|
|'''31/12/2037'''
|
|'''31/12/2038'''
|
|'''31/12/2039'''
|
|'''31/12/2040'''
|
|'''31/12/2041'''
|
|'''31/12/2042'''
|
|'''31/12/2043'''
|
|'''31/12/2044'''
|$23,680
|'''31/12/2045'''
|$33,677
|'''31/12/2046'''
|$46,445
|'''31/12/2047'''
|$62,115
|'''31/12/2048'''
|$80,558
|'''31/12/2049'''
|$101,316
|'''31/12/2050'''
|$185,352
|'''31/12/2051'''
|$219,221
|'''31/12/2052'''
|$251,432
|'''31/12/2053'''
|$279,652
|'''31/12/2054'''
|$301,627
|'''31/12/2055'''
|$315,485
|'''31/12/2056'''
|$319,996
|'''31/12/2057'''
|$314,750
|'''31/12/2058'''
|$300,223
|'''31/12/2059'''
|$277,702
|'''31/12/2060'''
|$249,098
|'''31/12/2061'''
|$216,679
|'''31/12/2062'''
|$182,777
|'''31/12/2063'''
|$149,514
|-
|$118,604
| colspan="43" |<div style="text-align: center;">'''Income statement'''</div>
|$91,237
|$68,061
|$49,236
|$34,541
|$23,498
|$15,502
|$9,917
|$6,153
|$3,702
|$2,160
|$1,222
|$670
|$357
|$184
|$92
|$45
|$21
|$10
|$4
|$2
|$1
|-
|-
|Operating profits ($'million)
|Revenues ($'million)|| $78,935||$112,257||$154,816||$207,049||$268,527
|
|$337,721
|
|$411,894
|
|$487,157
|
|$558,739
|
|$621,448
|
|$670,282
|
|$701,078
|
|$711,102
|
|$699,445
|
|$667,163
|
|$617,116
|
|$553,551
|
|$481,510
|
|$406,171
|
|$332,253
|
|$263,564
|
|$202,749
|
|$151,247
|$11,840
|$109,414
|$16,839
|$76,757
|$23,222
|$52,217
|$31,057
|$34,448
|$40,279
|$22,038
|$50,658
|$13,673
|$123,568
|$8,226
|$146,147
|$4,799
|$167,622
|$2,715
|$186,434
|$1,490
|$201,085
|$793
|$210,323
|$409
|$213,331
|$205
|$209,834
|$99
|$200,149
|$47
|$185,135
|$21
|$166,065
|$9
|$144,453
|$4
|$121,851
|$2
|$99,676
|-
|$79,069
|Gross profits ($'million)||$23,680||$33,677||$46,445||$62,115||$80,558
|$60,825
|$101,316
|$45,374
|$185,352
|$32,824
|$219,221
|$23,027
|$251,432
|$15,665
|$279,652
|$10,335
|$301,627
|$6,612
|$315,485
|$4,102
|$319,996
|$2,468
|$314,750
|$1,440
|$300,223
|$815
|$277,702
|$447
|$249,098
|$238
|$216,679
|$123
|$182,777
|$61
|$149,514
|$30
|$118,604
|$14
|$91,237
|$6
|$68,061
|$3
|$49,236
|$1
|$34,541
|$23,498
|$15,502
|$9,917
|$6,153
|$3,702
|$2,160
|$1,222
|$670
|$357
|$184
|$92
|$45
|$21
|$10
|$4
|$2
|$1
|$1
|-
|-
|Net profits ($'million)|| style="color: red;" |-12|| style="color: red;" |-30|| style="color: red;" |-78|| style="color: red;" |-83|| style="color: red;" |−56
|Operating profits ($'million)||$11,840||$16,839||$23,222||$31,057||$40,279
| style="color: red;" |−154
|$50,658
| style="color: red;" |−254
|$123,568
| style="color: red;" |−396
|$146,147
| style="color: red;" |−74
|$167,622
| style="color: red;" |−294
|$186,434
| style="color: red;" |−889
|$201,085
| style="color: red;" |−675
|$210,323
| style="color: red;" |−1,962
|$213,331
| style="color: red;" |−976
|$209,834
| style="color: red;" |−862
|$200,149
|721
|$185,135
|5,519
|$166,065
|12,556
|$144,453
|$9,354
|$121,851
|$13,302
|$99,676
|$18,346
|$79,069
|$24,535
|$60,825
|$31,820
|$45,374
|$40,020
|$32,824
|$97,619
|$23,027
|$115,456
|$15,665
|$132,421
|$10,335
|$147,283
|$6,612
|$158,857
|$4,102
|$166,156
|$2,468
|$168,531
|$1,440
|$165,769
|$815
|$158,118
|$447
|$146,256
|$238
|$131,192
|$123
|$114,118
|$61
|$96,263
|$30
|$78,744
|$14
|$62,465
|$6
|$48,052
|$3
|$35,846
|$1
|$25,931
|$18,191
|$12,376
|$8,164
|$5,223
|$3,240
|$1,949
|$1,137
|$643
|$353
|$188
|$97
|$48
|$24
|$11
|$5
|$2
|$1
|$1
|$0
|-
|-
| colspan="61" |<div style="text-align: center;">'''Balance sheet'''</div>
|Net profits ($'million)||$9,354||$13,302||$18,346||$24,535|| $31,820
|-
|$40,020
|Total assets<br />($'million)
|$97,619
|8
|$115,456
|44
|$132,421
|34
|$147,283
|52
|$158,857
|130
|$166,156
|386
|$168,531
|713
|$165,769
|1,114
|$158,118
|2,417
|$146,256
|5,831
|$131,192
|8,068
|$114,118
|22,664
|$96,263
|28,655
|$78,744
|29,740
|$62,465
|34,309
|$48,052
|52,148
|$35,846
|62,131
|$25,931
|82,338
|$18,191
|
|$12,376
|
|$8,164
|
|$5,223
|
|$3,240
|
|$1,949
|
|$1,137
|
|$643
|
|$353
|
|$188
|
|$97
|
|$48
|
|$24
|
|$11
|
|$5
|
|$2
|
|$1
|
|$0
|
|}
|
 
|
==== What are the assumptions used to estimate the financial forecasts?====
|
 
|
{| class="wikitable"
|
|+Key inputs
|
!Description
|
!Value
|
!Commentary
|
|-
|
| colspan="3" | <div style="text-align: center;">'''Revenue'''</div>
|
|-
|
|What's the estimated current size of the total addressable market?
|
|$2,975,000,000
|
|Here, the total addressable market (TAM) is defined as the global automotive market, and based on a number of assumptions<ref group="Note" name="Note01" />, it is estimated that the size of the market as of today (30th May 2022), in terms of revenue, is $2.975 trillion.
|
 
|
 
|
If the TAM is defined as the global energy market, then research suggests that the estimated size of the market is $6.777 trillion.<ref name=":16">https://www.ucl.ac.uk/bartlett/sustainable/sites/bartlett/files/an_exploration_of_energy_cost_ranges_limits_and_adjustment_process.pdf</ref>
|
|-
|
|What is the estimated company lifespan?
|
|60 years
|
|Tesla employs around 110,000, making the company a large organisation (more than 10,000 employees), and research shows that the average lifespan of a large corporation is around 50 years.<ref>Stadler, Enduring Success, 3–5.</ref>
|
|-
|
|What's the estimated annual growth rate of the total addressable market over the lifecycle of the company?
|
|3%
|Research shows that the growth rate of the global automotive market (i.e. the total addressable market) is similar to the growth rate of global gross domestic product<ref>http://www.robertpicard.net/files/econgrowthandadvertising.pdf</ref>, which has averaged (medium) around 3% per year in the last 20 years (2001 to 2022)<ref>https://www.macrotrends.net/countries/WLD/world/gdp-growth-rate</ref>.
|-
|-
| colspan="61" |<div style="text-align: center;">'''Other'''</div>
|What's the estimated company peak market share?
|10%
|The Stockhub users estimate that especially given the leadership of the company, the peak market share of Tesla is around 10%, and, therefore, suggests using the share amount here. As of 31st December 2021, Tesla's current share of the market is estimated at around 1.8%.
|-
|-
|Employees
|Which distribution function do you want to use to estimate company revenue?
|NA
|Gaussian
|70
|Research suggests that the revenue pattern of companies is similar to the pattern produced by the Gaussian distribution function  (i.e. the revenue distribution is bell shaped)<ref>http://escml.umd.edu/Papers/ObsCPMT.pdf</ref>, so the Stockhub users suggest using that function here.
|268
|-
|252
|What's the estimated standard deviation of company revenue?
|514
| 6 years
|899
|Another way of asking this question is this way: within how many years either side of the mean does 68% of revenue occur? Based on Tesla's current revenue amount (i.e. $54 billion) and Tesla's estimated lifespan (i.e. 60 years) and Tesla's estimated current stage of its lifecycle (i.e. growth stage), the Stockhub users suggest using 6 years (i.e. 68% of all sales happen within 6 years either side of the mean year), so that's what's used here.
|1,417
|-
|2,914
| colspan="3" |'''<div style="text-align: center;">Growth stages</div>'''
|5,859
|-
|10,161
|How many main stages of growth is the company expected to go through?
|13,058
| 4 stages
|17,782
|Research suggests that a company typically goes through four distinct stages of cash flow growth.<ref>Levie J, Lichtenstein BB (2010) A terminal assessment of stages theory: Introducing a dynamic approach to entrepreneurship. Entrepreneurship: Theory & Practice 34(2): 317–350. <nowiki>https://doi.org/10.1111/j.1540-6520.2010.00377.x</nowiki></ref> Research also shows that incorporating those stages into the discounted cash flow model improves the quality of the model and, ultimately, the quality of the value estimation.<ref>Stef Hinfelaar et al.:, 2019.</ref>
|37,543
 
|48,817
In addition, research shows that a key way to determine the stage which a company is in is by examining the cash flow patterns of the company.<ref>Dickinson, 2010.</ref> A summary of the economic links to cash flow patterns can be found in the appendix of this report. The Stockhub users estimate that with Tesla's operating cash flows positive (+), investing cash flows negative (-) and its financing cash flows positive (+), the company is in the second stage of growth (i.e. the 'growth' stage), and, therefore, it has a total of three main stages of growth. Note, to account for one-off events, the three-year average (median) amount was used to calculate the cash flows.
|48,016
 
|70,757
On 7th February 2022, Tesla said it currently expects: to continue to generate net positive operating cash flow as it has done in the last four fiscal years; its capital expenditures to be between $5.00 to $7.00 billion in 2022 and each of the next two fiscal years; and its ability to be self-funding to continue as long as macroeconomic factors support current trends in its sales. Accordingly, based on forward looking statements, it appears that the company is in stage two of the business lifecycle  (i.e. the 'growth' stage), and, therefore, it has a total of three main stages of growth remaining.
|99,290
|-
|127,855
|What proportion of the company lifecycle is represented by growth stage 1?
|
|30%
|
|Research suggests 30%.<ref name=":6">http://escml.umd.edu/Papers/ObsCPMT.pdf</ref>
|
|-
|
|What proportion of the company lifecycle is represented by growth stage 2?
|
|10%
|
|Research suggests 10%.<ref name=":6" />
|
|-
|
| What proportion of the company lifecycle is represented by growth stage 3?
|
|20%
|
| Research suggests 20%.<ref name=":6" />
|
|-
|
|What proportion of the company lifecycle is represented by growth stage 4?
|
|40%
|
|Research suggests 40%.<ref name=":6" />
|
|-
|
| colspan="3" |'''<div style="text-align: center;">Growth stage 2</div>'''
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|}
 
=== What are the assumptions used to estimate the financial forecasts? ===
 
{| class="wikitable"
|+Key inputs
!Description
!Value
!Commentary
|-
|-
| colspan="3" | <div style="text-align: center;">'''Revenue'''</div>
|Cost of goods sold as a proportion of revenue (%)
|79%
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 2)<ref name=":7">http://people.stern.nyu.edu/adamodar/pdfiles/papers/younggrowth.pdf</ref>, and the margin for its peers is 79%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.
|-
|-
|What's the estimated current size of the total addressable market?
|Operating expenses as a proportion of revenue (%)
|$2,975,000,000
|15%
|Here, the total addressable market (TAM) is defined as the global automotive market, and based on a number of assumptions<ref group="Note" name="Note01" />, it is estimated that the size of the market as of today (30th May 2022), in terms of revenue, is $2.975 trillion.
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 2)<ref name=":7" />, and the margin for its peers is 15%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.
 
 
If the TAM is defined as the global energy market, then research suggests that the estimated size of the market is $6.777 trillion.<ref name=":16">https://www.ucl.ac.uk/bartlett/sustainable/sites/bartlett/files/an_exploration_of_energy_cost_ranges_limits_and_adjustment_process.pdf</ref>
|-
|-
|What is the estimated company lifespan?
|Tax rate (%)
|60 years
|11%
|Tesla employs around 110,000, making the company a large organisation (more than 10,000 employees), and research shows that the average lifespan of a large corporation is around 50 years.<ref>Stadler, Enduring Success, 3–5.</ref>
|Research suggests that it's best to use a similar rate as the one used by peers that are in the same growth stage (i.e. growth stage 2)<ref name=":7" />, and the rate for its peers is 11%.
|-
|-
|What's the estimated annual growth rate of the total addressable market over the lifecycle of the company?
|Depreciation and amortisation as a proportion of revenue (%)
|3%
|7%
|Research shows that the growth rate of the global automotive market (i.e. the total addressable market) is similar to the growth rate of global gross domestic product<ref>http://www.robertpicard.net/files/econgrowthandadvertising.pdf</ref>, which has averaged (medium) around 3% per year in the last 20 years (2001 to 2022)<ref>https://www.macrotrends.net/countries/WLD/world/gdp-growth-rate</ref>.
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 2)<ref name=":7" />, and the margin for its peers is 7%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.
|-
|-
|What's the estimated company peak market share?
|Fixed capital as a proportion of revenue (%)
|10%
|10%
|The Stockhub users estimate that especially given the leadership of the company, the peak market share of Tesla is around 10%, and, therefore, suggests using the share amount here. As of 31st December 2021, Tesla's current share of the market is estimated at around 1.8%.
|Research suggests that it's best to use a similar amount as the one used by peers that are in the same growth stage (i.e. growth stage 2)<ref name=":7" />, and the amount for its peers is 10%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.
|-
|-
|Which distribution function do you want to use to estimate company revenue?
|Working capital as a proportion of revenue (%)
|Gaussian
|15%
|Research suggests that the revenue pattern of companies is similar to the pattern produced by the Gaussian distribution function  (i.e. the revenue distribution is bell shaped)<ref>http://escml.umd.edu/Papers/ObsCPMT.pdf</ref>, so the Stockhub users suggest using that function here.
|Research suggests that it's best to use a similar amount as the one used by peers that are in the same growth stage (i.e. growth stage 2)<ref name=":7" />, and the amount for its peers is 15%.
|-
|-
|What's the estimated standard deviation of company revenue?
|Net borrowing ($000)
| 6 years
|Zero
|Another way of asking this question is this way: within how many years either side of the mean does 68% of revenue occur? Based on Tesla's current revenue amount (i.e. $54 billion) and Tesla's estimated lifespan (i.e. 60 years) and Tesla's estimated current stage of its lifecycle (i.e. growth stage), the Stockhub users suggest using 6 years (i.e. 68% of all sales happen within 6 years either side of the mean year), so that's what's used here.
|Stockhub suggests that for simplicity, the net borrowing figure is zero.
|-
|-
| colspan="3" |'''<div style="text-align: center;">Growth stages</div>'''
|Interest amount ($000)
|Zero
|Stockhub suggests that for simplicity, the interest amount figure is zero.
|-
|-
|How many main stages of growth is the company expected to go through?
| colspan="3" |'''<div style="text-align: center;">Growth stage 3</div>'''
| 4 stages
|Research suggests that a company typically goes through four distinct stages of cash flow growth.<ref>Levie J, Lichtenstein BB (2010) A terminal assessment of stages theory: Introducing a dynamic approach to entrepreneurship. Entrepreneurship: Theory & Practice 34(2): 317–350. <nowiki>https://doi.org/10.1111/j.1540-6520.2010.00377.x</nowiki></ref> Research also shows that incorporating those stages into the discounted cash flow model improves the quality of the model and, ultimately, the quality of the value estimation.<ref>Stef Hinfelaar et al.:, 2019.</ref>
 
In addition, research shows that a key way to determine the stage which a company is in is by examining the cash flow patterns of the company.<ref>Dickinson, 2010.</ref> A summary of the economic links to cash flow patterns can be found in the appendix of this report. The Stockhub users estimate that with Tesla's operating cash flows positive (+), investing cash flows negative (-) and its financing cash flows positive (+), the company is in the second stage of growth (i.e. the 'growth' stage), and, therefore, it has a total of three main stages of growth. Note, to account for one-off events, the three-year average (median) amount was used to calculate the cash flows.
 
On 7th February 2022, Tesla said it currently expects: to continue to generate net positive operating cash flow as it has done in the last four fiscal years; its capital expenditures to be between $5.00 to $7.00 billion in 2022 and each of the next two fiscal years; and its ability to be self-funding to continue as long as macroeconomic factors support current trends in its sales. Accordingly, based on forward looking statements, it appears that the company is in stage two of the business lifecycle  (i.e. the 'growth' stage), and, therefore, it has a total of three main stages of growth remaining.
|-
|-
|What proportion of the company lifecycle is represented by growth stage 1?
|Cost of goods sold as a proportion of revenue (%)
|30%  
|62%
|Research suggests 30%.<ref name=":6">http://escml.umd.edu/Papers/ObsCPMT.pdf</ref>
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 3)<ref name=":7" />, and the margin for its peers is 62%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.  
|-
|-
|What proportion of the company lifecycle is represented by growth stage 2?
|Operating expenses as a proportion of revenue (%)
|10%  
|13%
|Research suggests 10%.<ref name=":6" />
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 3)<ref name=":7" />, and the margin for its peers is 13%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.
|-
|-
| What proportion of the company lifecycle is represented by growth stage 3?
|Tax rate (%)
|20%  
|14%
| Research suggests 20%.<ref name=":6" />
|Research suggests that it's best to use a similar rate as the one used by peers that are in the same growth stage (i.e. growth stage 3)<ref name=":7" />, and the rate for its peers is 14%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.
|-
|Depreciation and amortisation as a proportion of revenue (%)
|4%
|Research suggests that it's best to use a similar amount as the one used by peers that are in the same growth stage (i.e. growth stage 3)<ref name=":7" />, and the amount for its peers is 4%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.
|-
|Fixed capital as a proportion of revenue (%)
|3%
|Research suggests that it's best to use a similar amount as the one used by peers that are in the same growth stage (i.e. growth stage 3)<ref name=":7" />, and the amount for its peers is 3%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.
|-
|Working capital as a proportion of revenue (%)
|10%  
|Research suggests that it's best to use a similar amount as the one used by peers that are in the same growth stage (i.e. growth stage 4)<ref name=":7" />, and the amount for its peers is 10%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.
|-
|Net borrowing ($000)
|Zero
|The Stockhub users suggest that for simplicity, the net borrowing figure is zero.
|-
|-
|What proportion of the company lifecycle is represented by growth stage 4?
|Interest amount ($000)
|40%
|Zero
|Research suggests 40%.<ref name=":6" />
|The Stockhub users suggest that for simplicity, the interest amount figure is zero.
|-
|-
| colspan="3" |'''<div style="text-align: center;">Growth stage 2</div>'''
| colspan="3" |'''<div style="text-align: center;">Growth stage 4</div>'''
|-
|-
|Cost of goods sold as a proportion of revenue (%)  
|Cost of goods sold as a proportion of revenue (%)  
|79%
|99%
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 2)<ref name=":7">http://people.stern.nyu.edu/adamodar/pdfiles/papers/younggrowth.pdf</ref>, and the margin for its peers is 79%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.  
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 4)<ref name=":7" />, and the margin for its peers is 99%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.  
|-
|-
|Operating expenses as a proportion of revenue (%)
|Operating expenses as a proportion of revenue (%)
|15%
|15%
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 2)<ref name=":7" />, and the margin for its peers is 15%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 4)<ref name=":7" />, and the margin for its peers is 15%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.
|-
|-
|Tax rate (%)  
|Tax rate (%)  
|11%
|0%
|Research suggests that it's best to use a similar rate as the one used by peers that are in the same growth stage (i.e. growth stage 2)<ref name=":7" />, and the rate for its peers is 11%.
|Research suggests that it's best to use a similar rate as the one used by peers that are in the same growth stage (i.e. growth stage 4)<ref name=":7" />, and the rate for its peers is 0%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.
|-
|-
|Depreciation and amortisation as a proportion of revenue (%)  
|Depreciation and amortisation as a proportion of revenue (%)  
|7%
|37%
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 2)<ref name=":7" />, and the margin for its peers is 7%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.
|Research suggests that it's best to use a similar amount as the one used by peers that are in the same growth stage (i.e. growth stage 4)<ref name=":7" />, and the amount for its peers is 37%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.
|-
|-
|Fixed capital as a proportion of revenue (%)  
|Fixed capital as a proportion of revenue (%)
|10%
| 1%
|Research suggests that it's best to use a similar amount as the one used by peers that are in the same growth stage (i.e. growth stage 2)<ref name=":7" />, and the amount for its peers is 10%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.
|Research suggests that it's best to use a similar amount as the one used by peers that are in the same growth stage (i.e. growth stage 4)<ref name=":7" />, and the amount for its peers is 1%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.
|-
|-
|Working capital as a proportion of revenue (%)
|Working capital as a proportion of revenue (%)
|15%  
| 10%  
|Research suggests that it's best to use a similar amount as the one used by peers that are in the same growth stage (i.e. growth stage 2)<ref name=":7" />, and the amount for its peers is 15%.
|Research suggests that it's best to use a similar amount as the one used by peers that are in the same growth stage (i.e. growth stage 4)<ref name=":7" />, and the amount for its peers is 10%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.
|-
|-
|Net borrowing ($000)
|Net borrowing ($000)
|Zero
|Zero
|Stockhub suggests that for simplicity, the net borrowing figure is zero.
|The Stockhub users suggest that for simplicity, the net borrowing figure is zero.
|-
|-
|Interest amount ($000)
|Interest amount ($000)
|Zero
|Zero
|Stockhub suggests that for simplicity, the interest amount figure is zero.
|The Stockhub users suggest that for simplicity, the interest amount figure is zero.
|-
|}
| colspan="3" |'''<div style="text-align: center;">Growth stage 3</div>'''
 
|-
==Risks==
|Cost of goods sold as a proportion of revenue (%)
 
|62%
As with any investment, investing in Tesla carries a level of risk.  Overall, based on the Tesla's adjusted beta (i.e. 2.12), the degree of risk associated with an investment in Tesla is 'high'.
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 3)<ref name=":7" />, and the margin for its peers is 62%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.  
 
|-
Here, to estimate the adjusted beta, we used the iShares MSCI World ETF to represent the market portfolio; and in terms of the time period and frequency of observations, we used five years of monthly data (i.e. 60 observations in total), which is supported by a study and is the most common choice. The beta value in a future period has been found to be on average closer to the mean value of 1.0, and because valuation is forward-looking, it is logical to adjust the raw beta so it more accurately predicts a future beta. In addition, here, we have assumed that for an investment to be considered 'high' risk, it must have a beta value of 1.5 or more. Further information about the beta ratings can be found in the appendix section of this report.
|Operating expenses as a proportion of revenue (%)
 
|13%
The key risks can be found below. For us, currently, the biggest risk to the valuation of the company relates to the strong competition for its products and services from a growing list of established and new competitors (i.e. competition risk).
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 3)<ref name=":7" />, and the margin for its peers is 13%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.
 
|-
===Risks related to the ability to grow the business===
|Tax rate (%)
 
|14%
*Tesla may be impacted by macroeconomic conditions resulting from the global COVID-19 pandemic.
|Research suggests that it's best to use a similar rate as the one used by peers that are in the same growth stage (i.e. growth stage 3)<ref name=":7" />, and the rate for its peers is 14%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.
*Tesla may experience delays in launching and ramping the production of its products and features, or Tesla may be unable to control its manufacturing costs.
|-
*Tesla may be unable to grow its global product sales, delivery and installation capabilities and its servicing and vehicle charging networks, or Tesla may be unable to accurately project and effectively manage its growth.
|Depreciation and amortisation as a proportion of revenue (%)
*Tesla's future growth and success is dependent upon consumers’ demand for electric vehicles and specifically its vehicles in an automotive industry that is generally competitive, cyclical and volatile.
|4%
*Tesla's suppliers may fail to deliver components according to schedules, prices, quality and volumes that are acceptable to us, or Tesla may be unable to manage these components effectively.
|Research suggests that it's best to use a similar amount as the one used by peers that are in the same growth stage (i.e. growth stage 3)<ref name=":7" />, and the amount for its peers is 4%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.
*Tesla may be unable to meet its projected construction timelines, costs and production ramps at new factories, or Tesla may experience difficulties in generating and maintaining demand for products manufactured there.
|-
* Tesla will need to maintain and significantly grow its access to battery cells, including through the development and manufacture of its own cells, and control its related costs.
|Fixed capital as a proportion of revenue (%)
*Tesla faces strong competition for its products and services from a growing list of established and new competitors.
|3%
 
|Research suggests that it's best to use a similar amount as the one used by peers that are in the same growth stage (i.e. growth stage 3)<ref name=":7" />, and the amount for its peers is 3%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.
===Risks related to the company's operations===
|-
 
|Working capital as a proportion of revenue (%)
*Tesla may experience issues with lithium-ion cells or other components manufactured at Gigafactory Nevada and Gigafactory Shanghai, which may harm the production and profitability of its vehicle and energy storage products.
|10%
*Tesla faces risks associated with maintaining and expanding its international operations, including unfavourable and uncertain regulatory, political, economic, tax and labour conditions.
|Research suggests that it's best to use a similar amount as the one used by peers that are in the same growth stage (i.e. growth stage 4)<ref name=":7" />, and the amount for its peers is 10%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.
*Tesla's business may suffer if its products or features contain defects, fail to perform as expected or take longer than expected to become fully functional.
|-
*Tesla may be required to defend or insure against product liability claims.
|Net borrowing ($000)
*Tesla will need to maintain public credibility and confidence in its long-term business prospects in order to succeed.
|Zero
*Tesla may be unable to effectively grow, or manage the compliance, residual value, financing and credit risks related to, its various financing programs.
|The Stockhub users suggest that for simplicity, the net borrowing figure is zero.
*Tesla must manage ongoing obligations under its agreement with the Research Foundation for the State University of New York relating to its Gigafactory New York.
|-
*If Tesla is unable to attract, hire and retain key employees and qualified personnel, its ability to compete may be harmed.
|Interest amount ($000)
*Tesla is highly dependent on the services of Elon Musk, its Chief Executive Officer.
|Zero
*Tesla's information technology systems or data, or those of its service providers or customers or users could be subject to cyber-attacks or other security incidents, which could result in data breaches, intellectual property theft, claims, litigation, regulatory investigations, significant liability, reputational damage and other adverse consequences.
|The Stockhub users suggest that for simplicity, the interest amount figure is zero.
*Any unauthorized control or manipulation of Tesla's products’ systems could result in loss of confidence in it and its products.
|-
*Tesla's business may be adversely affected by any disruptions caused by union activities.
| colspan="3" |'''<div style="text-align: center;">Growth stage 4</div>'''
*Tesla may choose to or be compelled to undertake product recalls or take other similar actions.
|-
*Tesla's current and future warranty reserves may be insufficient to cover future warranty claims.
|Cost of goods sold as a proportion of revenue (%)
*Tesla's insurance coverage strategy may not be adequate to protect it from all business risks.
|99%
*Tesla's debt agreements contain covenant restrictions that may limit its ability to operate its business.
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 4)<ref name=":7" />, and the margin for its peers is 99%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.  
*Additional funds may not be available to Tesla when it needs or want them.
|-
*Tesla may be negatively impacted by any early obsolescence of its manufacturing equipment.
|Operating expenses as a proportion of revenue (%)
*Tesla holds and may acquire digital assets that may be subject to volatile market prices, impairment and unique risks of loss.
|15%
*There is no guarantee that Tesla will have sufficient cash flow from its business to pay its indebtedness or that it will not incur additional indebtedness.
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 4)<ref name=":7" />, and the margin for its peers is 15%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.
*Tesla is exposed to fluctuations in currency exchange rates.
|-
*Tesla may need to defend itself against intellectual property infringement claims, which may be time-consuming and expensive.
|Tax rate (%)
*Increased scrutiny and changing expectations from stakeholders with respect to the company's ESG practices may result in additional costs or risks.
|0%
* Tesla's operations could be adversely affected by events outside of its control, such as natural disasters, wars or health epidemics.
|Research suggests that it's best to use a similar rate as the one used by peers that are in the same growth stage (i.e. growth stage 4)<ref name=":7" />, and the rate for its peers is 0%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.
 
|-
===Risks related to government laws and regulations=== 
|Depreciation and amortisation as a proportion of revenue (%)
 
|37%
* Demand for Tesla's products and services may be impacted by the status of government and economic incentives supporting the development and adoption of such products.
|Research suggests that it's best to use a similar amount as the one used by peers that are in the same growth stage (i.e. growth stage 4)<ref name=":7" />, and the amount for its peers is 37%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.
*Tesla is subject to evolving laws and regulations that could impose substantial costs, legal prohibitions or unfavourable changes upon its operations or products.
|-
*Any failure by Tesla to comply with a variety of United States and international privacy and consumer protection laws may harm the company.
|Fixed capital as a proportion of revenue (%)
*Tesla could be subject to liability, penalties and other restrictive sanctions and adverse consequences arising out of certain governmental investigations and proceedings.
| 1%
*Tesla may face regulatory challenges to or limitations on its ability to sell vehicles directly.
|Research suggests that it's best to use a similar amount as the one used by peers that are in the same growth stage (i.e. growth stage 4)<ref name=":7" />, and the amount for its peers is 1%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.
 
|-
===Risks related to the ownership of the company's common stock=== 
|Working capital as a proportion of revenue (%)
 
| 10%
*The trading price of Tesla's common stock is likely to continue to be volatile.
|Research suggests that it's best to use a similar amount as the one used by peers that are in the same growth stage (i.e. growth stage 4)<ref name=":7" />, and the amount for its peers is 10%. Information on the peers and the calculation of the figure used here can be found in the appendix of this report.
* Tesla's financial results may vary significantly from period to period due to fluctuations in its operating costs and other factors.
|-
*Tesla may fail to meet its publicly announced guidance or other expectations about its business, which could cause its stock price to decline.
|Net borrowing ($000)
*Transactions relating to Tesla's convertible senior notes may dilute the ownership interest of existing stockholders, or may otherwise depress the price of its common stock.
|Zero
*If Elon Musk were forced to sell shares of Tesla's common stock that he has pledged to secure certain personal loan obligations, such sales could cause its stock price to decline.
|The Stockhub users suggest that for simplicity, the net borrowing figure is zero.
* Anti-takeover provisions contained in Tesla's governing documents, applicable laws and its convertible senior notes could impair a takeover attempt.
|-
|Interest amount ($000)
|Zero
|The Stockhub users suggest that for simplicity, the interest amount figure is zero.
|}


==Risks==
==Valuation==


As with any investment, investing in Tesla carries a level of risk.  Overall, based on the Tesla's adjusted beta (i.e. 2.12), the degree of risk associated with an investment in Tesla is 'high'.
===What's the expected return of an investment in the company?===


Here, to estimate the adjusted beta, we used the iShares MSCI World ETF to represent the market portfolio; and in terms of the time period and frequency of observations, we used five years of monthly data (i.e. 60 observations in total), which is supported by a study and is the most common choice. The beta value in a future period has been found to be on average closer to the mean value of 1.0, and because valuation is forward-looking, it is logical to adjust the raw beta so it more accurately predicts a future beta. In addition, here, we have assumed that for an investment to be considered 'high' risk, it must have a beta value of 1.5 or more. Further information about the beta ratings can be found in the appendix section of this report.
The Stockhub users estimate that the expected return of an investment in the company over the next five years is negative 24%. In other words, an £1,000 investment in the company is expected to return £760 in five years time. The assumptions used to estimate the return figure can be found in the table below.


The key risks can be found below. For us, currently, the biggest risk to the valuation of the company relates to the strong competition for its products and services from a growing list of established and new competitors (i.e. competition risk).
Assuming that a suitable return level over five years is 10% per year and Tesla achieves its expected return level (of negative 24%), then an investment in the company is considered to be an 'unsuitable' one.


===Risks related to the ability to grow the business===  
===What are the assumptions used to estimate the return?===


*Tesla may be impacted by macroeconomic conditions resulting from the global COVID-19 pandemic.
{| class="wikitable"
*Tesla may experience delays in launching and ramping the production of its products and features, or Tesla may be unable to control its manufacturing costs.
|+ Key inputs
*Tesla may be unable to grow its global product sales, delivery and installation capabilities and its servicing and vehicle charging networks, or Tesla may be unable to accurately project and effectively manage its growth.
!Description
*Tesla's future growth and success is dependent upon consumers’ demand for electric vehicles and specifically its vehicles in an automotive industry that is generally competitive, cyclical and volatile.
!Value
*Tesla's suppliers may fail to deliver components according to schedules, prices, quality and volumes that are acceptable to us, or Tesla may be unable to manage these components effectively.
!Commentary
*Tesla may be unable to meet its projected construction timelines, costs and production ramps at new factories, or Tesla may experience difficulties in generating and maintaining demand for products manufactured there.
|-
* Tesla will need to maintain and significantly grow its access to battery cells, including through the development and manufacture of its own cells, and control its related costs.
| Which valuation model do you want to use?
*Tesla faces strong competition for its products and services from a growing list of established and new competitors.
|Discounted cash flow
| There are two main approaches to estimate the value of an investment:
# By calculating the present value of the investment's expected future cash flows (i.e. discounted cash flow valuation); and
#By comparing the investment to other similar investments (i.e. relative valuation).


===Risks related to the company's operations===
Research suggests that in terms of estimating the expected return of an investment over a period of 12-months or more, the approach that is more accurate is the discounted cash flow approach<ref name=":5">Demirakos et al., 2010; Gleason et al., 2013</ref>, so that's the approach that he Stockhub users suggest to use here; nevertheless, for completeness purposes, separately, the valuation of the company is also estimated using the using the relative valuation approach (the valuation based on the relative approach can be found in the appendix of this report). 


*Tesla may experience issues with lithium-ion cells or other components manufactured at Gigafactory Nevada and Gigafactory Shanghai, which may harm the production and profitability of its vehicle and energy storage products.
Tesla has never paid cash dividends, and on 7th February 2022, it said that it currently does not anticipate paying any cash dividends in the foreseeable future. Accordingly, the Stockhub users suggest using the free cash flow valuation method (rather than the dividend discount model).  
*Tesla faces risks associated with maintaining and expanding its international operations, including unfavourable and uncertain regulatory, political, economic, tax and labour conditions.
|-
*Tesla's business may suffer if its products or features contain defects, fail to perform as expected or take longer than expected to become fully functional.
|Which financial forecasts to use?
*Tesla may be required to defend or insure against product liability claims.
| Stockhub
*Tesla will need to maintain public credibility and confidence in its long-term business prospects in order to succeed.
|The only available long-term forecasts (i.e. >15 years) are the ones that are supplied by the Stockhub users (the forecasts can be found in the financials section of this report), so the Stockhub users suggest using those.
*Tesla may be unable to effectively grow, or manage the compliance, residual value, financing and credit risks related to, its various financing programs.
|-
*Tesla must manage ongoing obligations under its agreement with the Research Foundation for the State University of New York relating to its Gigafactory New York.
| colspan="3" |'''<div style="text-align: center;">Growth stage 2</div>'''  
*If Tesla is unable to attract, hire and retain key employees and qualified personnel, its ability to compete may be harmed.
|-
*Tesla is highly dependent on the services of Elon Musk, its Chief Executive Officer.
|Discount rate (%)
*Tesla's information technology systems or data, or those of its service providers or customers or users could be subject to cyber-attacks or other security incidents, which could result in data breaches, intellectual property theft, claims, litigation, regulatory investigations, significant liability, reputational damage and other adverse consequences.
| 15%
*Any unauthorized control or manipulation of Tesla's products’ systems could result in loss of confidence in it and its products.
|There are two key risk parameters for a firm that need to be estimated: its cost of equity and its cost of debt. A key way to estimate the cost of equity is by looking at the beta (or betas) of the company in question, the cost of debt from a measure of default risk (an actual or synthetic rating) and apply the market value weights for debt and equity to come up with the cost of capital.
*Tesla's business may be adversely affected by any disruptions caused by union activities.
|-
*Tesla may choose to or be compelled to undertake product recalls or take other similar actions.
|Probability of success (%)
*Tesla's current and future warranty reserves may be insufficient to cover future warranty claims.
| 90%
*Tesla's insurance coverage strategy may not be adequate to protect it from all business risks.
| Research suggests that a suitable rate for a company in this growth stage (i.e. stage 2) is 90%.
*Tesla's debt agreements contain covenant restrictions that may limit its ability to operate its business.
*Additional funds may not be available to Tesla when it needs or want them.
*Tesla may be negatively impacted by any early obsolescence of its manufacturing equipment.
*Tesla holds and may acquire digital assets that may be subject to volatile market prices, impairment and unique risks of loss.
*There is no guarantee that Tesla will have sufficient cash flow from its business to pay its indebtedness or that it will not incur additional indebtedness.
*Tesla is exposed to fluctuations in currency exchange rates.
*Tesla may need to defend itself against intellectual property infringement claims, which may be time-consuming and expensive.
*Increased scrutiny and changing expectations from stakeholders with respect to the company's ESG practices may result in additional costs or risks.
* Tesla's operations could be adversely affected by events outside of its control, such as natural disasters, wars or health epidemics.


===Risks related to government laws and regulations=== 
|-
 
| colspan="3" |'''<div style="text-align: center;">Growth stage 3</div>'''
* Demand for Tesla's products and services may be impacted by the status of government and economic incentives supporting the development and adoption of such products.
|-
*Tesla is subject to evolving laws and regulations that could impose substantial costs, legal prohibitions or unfavourable changes upon its operations or products.
|Discount rate (%)
*Any failure by Tesla to comply with a variety of United States and international privacy and consumer protection laws may harm the company.
| 10%
*Tesla could be subject to liability, penalties and other restrictive sanctions and adverse consequences arising out of certain governmental investigations and proceedings.
|There are two key risk parameters for a firm that need to be estimated: its cost of equity and its cost of debt. A key way to estimate the cost of equity is by looking at the beta (or betas) of the company in question, the cost of debt from a measure of default risk (an actual or synthetic rating) and apply the market value weights for debt and equity to come up with the cost of capital.
*Tesla may face regulatory challenges to or limitations on its ability to sell vehicles directly.
|-
|Probability of success (%)
|100%
|Research suggests that a suitable rate for a company in this growth stage (i.e. stage 3) is 100%.


===Risks related to the ownership of the company's common stock=== 
|-
| colspan="3" |'''<div style="text-align: center;">Growth stage 4</div>'''
|-
|Discount rate (%)
| 10%
|There are two key risk parameters for a firm that need to be estimated: its cost of equity and its cost of debt. A key way to estimate the cost of equity is by looking at the beta (or betas) of the company in question, the cost of debt from a measure of default risk (an actual or synthetic rating) and apply the market value weights for debt and equity to come up with the cost of capital.
|-
|Probability of success (%)
| 100%
|Research suggests that a suitable rate for a company in this growth stage (i.e. stage 4) is 100%.


*The trading price of Tesla's common stock is likely to continue to be volatile.
|-
* Tesla's financial results may vary significantly from period to period due to fluctuations in its operating costs and other factors.
| colspan="3" |'''<div style="text-align: center;">Other key inputs</div>'''
*Tesla may fail to meet its publicly announced guidance or other expectations about its business, which could cause its stock price to decline.
|-
*Transactions relating to Tesla's convertible senior notes may dilute the ownership interest of existing stockholders, or may otherwise depress the price of its common stock.
|What's the current value of the company?
*If Elon Musk were forced to sell shares of Tesla's common stock that he has pledged to secure certain personal loan obligations, such sales could cause its stock price to decline.
|$950.54 billion
* Anti-takeover provisions contained in Tesla's governing documents, applicable laws and its convertible senior notes could impair a takeover attempt.
|As at 5th June 2022, the current value of the Tesla company is $950.54 billion.
|-
|Which time period do you want to use to estimate the expected return?
| Between now and five years time
|Research suggests that following a market crash, the average amount of time it takes for the price of a stock market to return to its pre-crash level (i.e. the recovery period) is at least three years.<ref>https://www.newyorkfed.org/mediabrary/media/medialibrary/media/research/staff_reports/research_papers/9809.pdf</ref> Accordingly, Stockhub suggests that to account for general market cyclicity, it's best to estimate the expected return of the company between now and five years time.
|}


==Valuation==
===Sensitive analysis===


===What's the expected return of an investment in the company?===
The main inputs that result in the greatest change in the expected return of the Tesla investment are, in order of importance (from highest to lowest): 


The Stockhub users estimate that the expected return of an investment in the company over the next five years is negative 24%. In other words, an £1,000 investment in the company is expected to return £760 in five years time. The assumptions used to estimate the return figure can be found in the table below.
#The size of the total addressable market (the default size is $3.0 trillion);
#Tesla peak market share (the default share is 10%); and
#The discount rate (the default time-weighted average rate is 10%).


Assuming that a suitable return level over five years is 10% per year and Tesla achieves its expected return level (of negative 24%), then an investment in the company is considered to be an 'unsuitable' one.
The impact of a 50% change in those main inputs to the expected return of the Tesla investment is shown in the table below.


===What are the assumptions used to estimate the return?===
{| class="wikitable sortable"
 
|+Tesla investment expected return sensitive analysis
{| class="wikitable"
!Main input
|+ Key inputs
!50% worse
!Description
!Unchanged
!Value
!50% better
!Commentary
|-
|-
| Which valuation model do you want to use?
|The size of the total addressable market
|Discounted cash flow
|N/A
| There are two main approaches to estimate the value of an investment:
|(24%)
# By calculating the present value of the investment's expected future cash flows (i.e. discounted cash flow valuation); and
|N/A
#By comparing the investment to other similar investments (i.e. relative valuation).
|-
|Tesla peak market share
|N/A
| (24%)
| N/A
|-
|The discount rate
 
|N/A
|(24%)
| N/A
 
|}


Research suggests that in terms of estimating the expected return of an investment over a period of 12-months or more, the approach that is more accurate is the discounted cash flow approach<ref name=":5">Demirakos et al., 2010; Gleason et al., 2013</ref>, so that's the approach that he Stockhub users suggest to use here; nevertheless, for completeness purposes, separately, the valuation of the company is also estimated using the using the relative valuation approach (the valuation based on the relative approach can be found in the appendix of this report). 
==Appendix==


Tesla has never paid cash dividends, and on 7th February 2022, it said that it currently does not anticipate paying any cash dividends in the foreseeable future. Accordingly, the Stockhub users suggest using the free cash flow valuation method (rather than the dividend discount model).  
=== Competition ===
==== Automotive ====
{| class="wikitable"
|+Model S competition comparison
!Category
!Model S<ref name=":8">https://www.porsche.com/usa/models/taycan/taycan-models/taycan/</ref>
!Porsche Taycan<ref name=":8" />
|-
|-
|Which financial forecasts to use?
|Is the vehicle fully electric?
| Stockhub
| style="background: orange; color: white;" |Yes
|The only available long-term forecasts (i.e. >15 years) are the ones that are supplied by the Stockhub users (the forecasts can be found in the financials section of this report), so the Stockhub users suggest using those.
| style="background: orange; color: white;" |Yes
|-
|-
| colspan="3" |'''<div style="text-align: center;">Growth stage 2</div>'''
|What's the top acceleration of the vehicle?
| style="background: green; color: white;" |3.1 seconds
| style="background: red; color: white;" |5.1 seconds
|-
|-
|Discount rate (%)
|What's the maximum distance range of the vehicle on a single battery charge?
| 15%
| style="background: green; color: white;" |405 miles
|There are two key risk parameters for a firm that need to be estimated: its cost of equity and its cost of debt. A key way to estimate the cost of equity is by looking at the beta (or betas) of the company in question, the cost of debt from a measure of default risk (an actual or synthetic rating) and apply the market value weights for debt and equity to come up with the cost of capital.
| style="background: red; color: white;" |200 miles
|-
|-
|Probability of success (%)
|What's the top speed of the vehicle?
| 90%
| style="background: green; color: white;" |155 miles per hour
| Research suggests that a suitable rate for a company in this growth stage (i.e. stage 2) is 90%.
| style="background: red; color: white;" |143 miles per hour
 
|-
|-
| colspan="3" |'''<div style="text-align: center;">Growth stage 3</div>'''
|Which design type is the vehicle?
| style="background: orange; color: white;" |Sedan (i.e. car)
| style="background: orange; color: white;" |Sedan (i.e. car)
|-
|-
|Discount rate (%)
|What is the safety rating of the vehicle?
| 10%
| style="background: orange; color: white;" |5 out of 5 stars
|There are two key risk parameters for a firm that need to be estimated: its cost of equity and its cost of debt. A key way to estimate the cost of equity is by looking at the beta (or betas) of the company in question, the cost of debt from a measure of default risk (an actual or synthetic rating) and apply the market value weights for debt and equity to come up with the cost of capital.
| style="background: orange; color: white;" |5 out of 5 stars
|-
|-
|Probability of success (%)
|How many seats does the vehicle have?
|100%
| style="background: green; color: white;" |5 seats
|Research suggests that a suitable rate for a company in this growth stage (i.e. stage 3) is 100%.
| style="background: red; color: white;" |4 seats
 
|-
|-
| colspan="3" |'''<div style="text-align: center;">Growth stage 4</div>'''
|What's the cargo capacity of the vehicle?
| style="background: green; color: white;" |28 cubic feet
| style="background: red; color: white;" |17.2 cubic feet
|-
|-
|Discount rate (%)
|Which drive wheel does the vehicle have?
| 10%
| style="background: green; color: white;" |All-wheel drive
|There are two key risk parameters for a firm that need to be estimated: its cost of equity and its cost of debt. A key way to estimate the cost of equity is by looking at the beta (or betas) of the company in question, the cost of debt from a measure of default risk (an actual or synthetic rating) and apply the market value weights for debt and equity to come up with the cost of capital.
| style="background: red; color: white;" |Rear-wheel drive
|-
|-
|Probability of success (%)
|What's the price of the vehicle?
| 100%
| style="background: red; color: white;" |$99,990
|Research suggests that a suitable rate for a company in this growth stage (i.e. stage 4) is 100%.
| style="background: green; color: white;" |$86,700
 
|-
|-
| colspan="3" |'''<div style="text-align: center;">Other key inputs</div>'''
|What's the vehicle's price per cargo capacity?
| style="background: green; color: white;" |$3,571 per cubic feet
| style="background: red; color: white;" |$5,041 per cubic feet
|-
|-
|What's the current value of the company?
|What's the vehicle's price per seat?
|$950.54 billion
| style="background: green; color: white;" |$19,998 per seat
|As at 5th June 2022, the current value of the Tesla company is $950.54 billion.
| style="background: red; color: white;" |$21,675 per seat
|-
|Which time period do you want to use to estimate the expected return?
| Between now and five years time
|Research suggests that following a market crash, the average amount of time it takes for the price of a stock market to return to its pre-crash level (i.e. the recovery period) is at least three years.<ref>https://www.newyorkfed.org/mediabrary/media/medialibrary/media/research/staff_reports/research_papers/9809.pdf</ref> Accordingly, Stockhub suggests that to account for general market cyclicity, it's best to estimate the expected return of the company between now and five years time.
|}
|}


===Sensitive analysis===
{| class="wikitable"
 
|+Model 3 competition comparison
The main inputs that result in the greatest change in the expected return of the Tesla investment are, in order of importance (from highest to lowest): 
!Category
 
!Model 3<ref>https://www.tesla.com/model3</ref>
#The size of the total addressable market (the default size is $3.0 trillion);
!Mustang Mach-E<ref>https://www.ford.com/suvs/mach-e/?gnav=header-electrified-vhp</ref>
#Tesla peak market share (the default share is 10%); and
#The discount rate (the default time-weighted average rate is 10%).
 
The impact of a 50% change in those main inputs to the expected return of the Tesla investment is shown in the table below.
 
{| class="wikitable sortable"
|+Tesla investment expected return sensitive analysis
!Main input
!50% worse
!Unchanged
!50% better
|-
|-
|The size of the total addressable market
|Is the vehicle fully electric?
|N/A
| style="background: orange; color: white;" |Yes
|(24%)
| style="background: orange; color: white;" |Yes
|N/A
|-
|-
|Tesla peak market share
|What's the top acceleration of the vehicle?
|N/A
| style="background: red; color: white;" |5.8 seconds
| (24%)
| style="background: green; color: white;" |5.2 seconds
| N/A
|-
|The discount rate
 
|N/A
|(24%)
| N/A
 
|}
 
==Appendix==
 
=== Competition ===
==== Automotive ====
{| class="wikitable"
|+Model S competition comparison
!Category
!Model S<ref name=":8">https://www.porsche.com/usa/models/taycan/taycan-models/taycan/</ref>
!Porsche Taycan<ref name=":8" />
|-
|Is the vehicle fully electric?
| style="background: orange; color: white;" |Yes
| style="background: orange; color: white;" |Yes
|-
|What's the top acceleration of the vehicle?
| style="background: green; color: white;" |3.1 seconds
| style="background: red; color: white;" |5.1 seconds
|-
|-
|What's the maximum distance range of the vehicle on a single battery charge?
|What's the maximum distance range of the vehicle on a single battery charge?
| style="background: green; color: white;" |405 miles
| style="background: green; color: white;" |272 miles
| style="background: red; color: white;" |200 miles
| style="background: red; color: white;" |247 miles
|-
|-
|What's the top speed of the vehicle?
|What's the top speed of the vehicle?
| style="background: green; color: white;" |155 miles per hour
| style="background: green; color: white;" |140 miles per hour
| style="background: red; color: white;" |143 miles per hour
| style="background: red; color: white;" |124 miles per hour
|-
|-
|Which design type is the vehicle?
|Which design type is the vehicle?
| style="background: orange; color: white;" |Sedan (i.e. car)
| style="background: orange; color: white;" |Sedan (i.e. car)
| style="background: orange; color: white;" |Sedan (i.e. car)
| style="background: orange; color: white;" |SUV (i.e. car)
|-
|-
|What is the safety rating of the vehicle?
|What is the safety rating of the vehicle?
Line 1,521: Line 1,380:
|-
|-
|How many seats does the vehicle have?
|How many seats does the vehicle have?
| style="background: green; color: white;" |5 seats
| style="background: orange; color: white;" |5 seats
| style="background: red; color: white;" |4 seats
| style="background: orange; color: white;" |5 seats
|-
|-
|What's the cargo capacity of the vehicle?
|What's the cargo capacity of the vehicle?
| style="background: green; color: white;" |28 cubic feet
| style="background: red; color: white;" |23 cubic feet
| style="background: red; color: white;" |17.2 cubic feet
| style="background: green; color: white;" |59.7 cubic feet
|-
|-
|Which drive wheel does the vehicle have?  
|Which drive wheel does the vehicle have?  
| style="background: green; color: white;" |All-wheel drive
| style="background: orange; color: white;" |Rear-wheel drive
| style="background: red; color: white;" |Rear-wheel drive
| style="background: orange; color: white;" |Rear-wheel drive
|-
|-
|What's the price of the vehicle?
|What's the price of the vehicle?
| style="background: red; color: white;" |$99,990
| style="background: red; color: white;" |$46,990
| style="background: green; color: white;" |$86,700
| style="background: green; color: white;" |$43,895
|-
|-
|What's the vehicle's price per cargo capacity?
|What's the vehicle's price per cargo capacity?
| style="background: green; color: white;" |$3,571 per cubic feet
| style="background: red; color: white;" |$2,043 per cubic feet
| style="background: red; color: white;" |$5,041 per cubic feet
| style="background: green; color: white;" |$735 per cubic feet
|-
|-
|What's the vehicle's price per seat?
|What's the vehicle's price per seat?
| style="background: green; color: white;" |$19,998 per seat
| style="background: red; color: white;" |$9,398 per seat
| style="background: red; color: white;" |$21,675 per seat
| style="background: green; color: white;" |$8,779 per seat
|}
|}


{| class="wikitable"
{| class="wikitable"
|+Model 3 competition comparison
|+Model X competition comparison
!Category
!Category
!Model 3<ref>https://www.tesla.com/model3</ref>
!Model X<ref name=":13" />
!Mustang Mach-E<ref>https://www.ford.com/suvs/mach-e/?gnav=header-electrified-vhp</ref>
!Audi e-tron<ref>https://www.audiusa.com/us/web/en/models/e-tron/e-tron/2022/overview.html#2022-Audi-e-tron%C2%AE</ref>
|-
|-
|Is the vehicle fully electric?
|Is the vehicle fully electric?
Line 1,556: Line 1,415:
|-
|-
|What's the top acceleration of the vehicle?
|What's the top acceleration of the vehicle?
| style="background: red; color: white;" |5.8 seconds
| style="background: green; color: white;" |3.8 seconds
| style="background: green; color: white;" |5.2 seconds
| style="background: red; color: white;" |5.5 seconds
|-
|-
|What's the maximum distance range of the vehicle on a single battery charge?
|What's the maximum distance range of the vehicle on a single battery charge?
| style="background: green; color: white;" |272 miles
| style="background: green; color: white;" |348 miles
| style="background: red; color: white;" |247 miles
| style="background: red; color: white;" |222 miles
|-
|-
|What's the top speed of the vehicle?
|What's the top speed of the vehicle?
| style="background: green; color: white;" |140 miles per hour
| style="background: green; color: white;" |155 miles per hour
| style="background: red; color: white;" |124 miles per hour
| style="background: red; color: white;" |124 miles per hour
|-
|-
|Which design type is the vehicle?
|Which design type is the vehicle?
| style="background: orange; color: white;" |Sedan (i.e. car)
| style="background: orange; color: white;" |SUV (i.e. car)
| style="background: orange; color: white;" |SUV (i.e. car)
| style="background: orange; color: white;" |SUV (i.e. car)
|-
|-
Line 1,576: Line 1,435:
|-
|-
|How many seats does the vehicle have?
|How many seats does the vehicle have?
| style="background: orange; color: white;" |5 seats
| style="background: green; color: white;" |7 seats
| style="background: orange; color: white;" |5 seats
| style="background: red; color: white;" |5 seats
|-
|-
|What's the cargo capacity of the vehicle?
|What's the cargo capacity of the vehicle?
| style="background: red; color: white;" |23 cubic feet
| style="background: green; color: white;" |88 cubic feet
| style="background: green; color: white;" |59.7 cubic feet
| style="background: red; color: white;" |56 cubic feet
|-
|-
|Which drive wheel does the vehicle have?  
|Which drive wheel does the vehicle have?  
| style="background: orange; color: white;" |Rear-wheel drive
| style="background: orange; color: white;" |All-wheel drive
| style="background: orange; color: white;" |Rear-wheel drive
| style="background: orange; color: white;" |All-wheel drive
|-
|-
|What's the price of the vehicle?
|What's the price of the vehicle?
| style="background: red; color: white;" |$46,990
| style="background: red; color: white;" |$114,990
| style="background: green; color: white;" |$43,895
| style="background: green; color: white;" |$65,900
|-
|-
|What's the vehicle's price per cargo capacity?
|What's the vehicle's price per cargo capacity?
| style="background: red; color: white;" |$2,043 per cubic feet
| style="background: red; color: white;" |$1,307 per cubic feet
| style="background: green; color: white;" |$735 per cubic feet
| style="background: green; color: white;" |$1,168 per cubic feet
|-
|-
|What's the vehicle's price per seat?
|What's the vehicle's price per seat?
| style="background: red; color: white;" |$9,398 per seat
| style="background: red; color: white;" |$16,427 per seat
| style="background: green; color: white;" |$8,779 per seat
| style="background: green; color: white;" |$13,180 per seat
|}
|}


{| class="wikitable"
{| class="wikitable"
|+Model X competition comparison
|+Model Y competition comparison
!Category
!Category
!Model X<ref name=":13" />
!Model Y<ref name=":13" />
!Audi e-tron<ref>https://www.audiusa.com/us/web/en/models/e-tron/e-tron/2022/overview.html#2022-Audi-e-tron%C2%AE</ref>
!Volkswagen ID.4
|-
|-
|Is the vehicle fully electric?
|Is the vehicle fully electric?
Line 1,611: Line 1,470:
|-
|-
|What's the top acceleration of the vehicle?
|What's the top acceleration of the vehicle?
| style="background: green; color: white;" |3.8 seconds
| style="background: green; color: white;" |4.8 seconds
| style="background: red; color: white;" |5.5 seconds
| style="background: red; color: white;" |8.5 seconds
|-
|-
|What's the maximum distance range of the vehicle on a single battery charge?
|What's the maximum distance range of the vehicle on a single battery charge?
| style="background: green; color: white;" |348 miles
| style="background: green; color: white;" |330 miles
| style="background: red; color: white;" |222 miles
| style="background: red; color: white;" |275 miles
|-
|-
|What's the top speed of the vehicle?
|What's the top speed of the vehicle?
| style="background: green; color: white;" |155 miles per hour
| style="background: green; color: white;" |135 miles per hour
| style="background: red; color: white;" |124 miles per hour
| style="background: red; color: white;" |100 miles per hour
|-
|-
|Which design type is the vehicle?
|Which design type is the vehicle?
Line 1,635: Line 1,494:
|-
|-
|What's the cargo capacity of the vehicle?
|What's the cargo capacity of the vehicle?
| style="background: green; color: white;" |88 cubic feet
| style="background: green; color: white;" |76 cubic feet
| style="background: red; color: white;" |56 cubic feet
| style="background: red; color: white;" |55.6 cubic feet
|-
|-
|Which drive wheel does the vehicle have?  
|Which drive wheel does the vehicle have?  
| style="background: orange; color: white;" |All-wheel drive
| style="background: green; color: white;" |All-wheel drive
| style="background: orange; color: white;" |All-wheel drive
| style="background: red; color: white;" |Rear-wheel drive
|-
|-
|What's the price of the vehicle?
|What's the price of the vehicle?
| style="background: red; color: white;" |$114,990
| style="background: red; color: white;" |$62,990
| style="background: green; color: white;" |$65,900
| style="background: green; color: white;" |$41,230
|-
|-
|What's the vehicle's price per cargo capacity?
|What's the vehicle's price per cargo capacity?
| style="background: red; color: white;" |$1,307 per cubic feet
| style="background: red; color: white;" |$829 per cubic feet
| style="background: green; color: white;" |$1,168 per cubic feet
| style="background: green; color: white;" |$742 per cubic feat
|-
|-
|What's the vehicle's price per seat?
|What's the vehicle's price per seat?
| style="background: red; color: white;" |$16,427 per seat
| style="background: red; color: white;" |$8,999 per seat
| style="background: green; color: white;" |$13,180 per seat
| style="background: green; color: white;" |$8,248 per seat
|}
|}
==== Energy generation and storage ====


{| class="wikitable"
{| class="wikitable"
|+Model Y competition comparison
|+All Tesla energy storage competition comparison
!Category
!Model Y<ref name=":13" />
!Volkswagen ID.4
|-
|-
|Is the vehicle fully electric?
! !!Powerwall!!'''Megapack'''
| style="background: orange; color: white;" |Yes
| style="background: orange; color: white;" |Yes
|-
|-
|What's the top acceleration of the vehicle?
|Is the source of energy solar?||style="background: orange; color: white;" |Yes||style="background: orange; color: white;" |Yes
| style="background: green; color: white;" |4.8 seconds
| style="background: red; color: white;" |8.5 seconds
|-
|-
|What's the maximum distance range of the vehicle on a single battery charge?
|Is it designed for houses (i.e. smaller electricity demand)?||style="background: green; color: white;" |Yes||style="background: red; color: white;" |No
| style="background: green; color: white;" |330 miles
| style="background: red; color: white;" |275 miles
|-
|-
|What's the top speed of the vehicle?
|Is it designed for commercial buildings (i.e. greater electricity demand)?||style="background: red; color: white;" |No|| style="background: green; color: white;" |Yes
| style="background: green; color: white;" |135 miles per hour
| style="background: red; color: white;" |100 miles per hour
|-
|-
|Which design type is the vehicle?
|What's the energy capacity of the product?
| style="background: orange; color: white;" |SUV (i.e. car)
|style="background: red; color: white;" |13.5 kilowatt hour
| style="background: orange; color: white;" |SUV (i.e. car)
|style="background: green; color: white;" |3.5 megawatt hour
|-
|-
|What is the safety rating of the vehicle?
|What’s the power of the product?
| style="background: orange; color: white;" |5 out of 5 stars
|style="background: red; color: white;" |5 kilowatts
| style="background: orange; color: white;" |5 out of 5 stars
|style="background: green; color: white;" |1.54 megawatts
|-
|-
|How many seats does the vehicle have?
|How long does it take to charge the battery if there’s sufficient solar energy?
| style="background: green; color: white;" |7 seats
|style="background: red; color: white;" |2.7 hours
| style="background: red; color: white;" |5 seats
|style="background: green; color: white;" |2.3 hours
|-
|-
|What's the cargo capacity of the vehicle?
|What's the price of the product?
| style="background: green; color: white;" |76 cubic feet
|style="background: green; color: white;" |$10,500
| style="background: red; color: white;" |55.6 cubic feet
|style="background: red; color: white;" |$1,000,000
|-
|-
|Which drive wheel does the vehicle have?
|What's the price per energy capacity?
| style="background: green; color: white;" |All-wheel drive
|style="background: red; color: white;" |$593 per kilowatt hour
| style="background: red; color: white;" |Rear-wheel drive
|style="background: green; color: white;" |$286 per kilowatt hour
|-
|}
|What's the price of the vehicle?
Note: 1 megawatt is equivalent to 1,000 kilowatts.
| style="background: red; color: white;" |$62,990
| style="background: green; color: white;" |$41,230
|-
|What's the vehicle's price per cargo capacity?
| style="background: red; color: white;" |$829 per cubic feet
| style="background: green; color: white;" |$742 per cubic feat
|-
|What's the vehicle's price per seat?
| style="background: red; color: white;" |$8,999 per seat
| style="background: green; color: white;" |$8,248 per seat
|}
 
==== Energy generation and storage ====
 
{| class="wikitable"
{| class="wikitable"
|+All Tesla energy storage competition comparison
|+Powerwall competition comparison
!What's the name of the product?
!Powerwall
!LG Chem
!SonnenCore
|-
|-
! !!Powerwall!!'''Megapack'''
|Is the source of energy solar?
|style="background: orange; color: white;" |Yes
|style="background: orange; color: white;" |Yes
|style="background: orange; color: white;" |Yes
|-
|-
|Is the source of energy solar?||style="background: orange; color: white;" |Yes||style="background: orange; color: white;" |Yes
|What's the energy capacity of the product?
|style="background: green; color: white;" |13.5 kilowatt hour
|style="background: red; color: white;" |9.3 kilowatt hour
|style="background: orange; color: white;" |10 kilowatt hour
|-
|-
|Is it designed for houses (i.e. smaller electricity demand)?||style="background: green; color: white;" |Yes||style="background: red; color: white;" |No
|What's the price of the product?
|-
|style="background: red; color: white;" |$10,500
|Is it designed for commercial buildings (i.e. greater electricity demand)?||style="background: red; color: white;" |No|| style="background: green; color: white;" |Yes
|style="background: green; color: white;" |$7,000
|-
|style="background: orange; color: white;" |$9,500
|What's the energy capacity of the product?
|style="background: red; color: white;" |13.5 kilowatt hour
|style="background: green; color: white;" |3.5 megawatt hour
|-
|What’s the power of the product?
|style="background: red; color: white;" |5 kilowatts
|style="background: green; color: white;" |1.54 megawatts
|-
|How long does it take to charge the battery if there’s sufficient solar energy?
|style="background: red; color: white;" |2.7 hours
|style="background: green; color: white;" |2.3 hours
|-
|What's the price of the product?
|style="background: green; color: white;" |$10,500
|style="background: red; color: white;" |$1,000,000
|-
|-
|What's the price per energy capacity?
|What's the price per energy capacity?
|style="background: red; color: white;" |$593 per kilowatt hour
|style="background: green; color: white;" |$593 per kilowatt hour
|style="background: green; color: white;" |$286 per kilowatt hour
|style="background: orange; color: white;" |$753 per kilowatt hour
|style="background: red; color: white;" |$950 per kilowatt hour
|}
|}
Note: 1 megawatt is equivalent to 1,000 kilowatts.
 
{| class="wikitable"
{| class="wikitable"
|+Powerwall competition comparison
|+Solar Roof competition comparison
!What's the name of the product?
!Powerwall
!LG Chem
!SonnenCore
|-
|Is the source of energy solar?
|style="background: orange; color: white;" |Yes
|style="background: orange; color: white;" |Yes
|style="background: orange; color: white;" |Yes
|-
|What's the energy capacity of the product?
|style="background: green; color: white;" |13.5 kilowatt hour
|style="background: red; color: white;" |9.3 kilowatt hour
|style="background: orange; color: white;" |10 kilowatt hour
|-
|What's the price of the product?
|style="background: red; color: white;" |$10,500
|style="background: green; color: white;" |$7,000
|style="background: orange; color: white;" |$9,500
|-
|What's the price per energy capacity?
|style="background: green; color: white;" |$593 per kilowatt hour
|style="background: orange; color: white;" |$753 per kilowatt hour
|style="background: red; color: white;" |$950 per kilowatt hour
|}
 
{| class="wikitable"
|+Solar Roof competition comparison
|-
|-
! !!Solar Roof!!Traditional roof tile
! !!Solar Roof!!Traditional roof tile
Line 2,673: Line 2,477:
|Agriculture, Forestry and Land Use
|Agriculture, Forestry and Land Use
|}
|}
=== Liquidity ===
Our assessment reveals that Tesla's shares exhibit a high level of liquidity, as evidenced by its bid-ask margin of 0.0297%. To gauge the bid-ask margin, we divided the ask-bid spread by the ask price. Our criterion for classifying an investment as 'highly' liquid is a bid-ask margin of 1% or less. For more details on liquidity ratings, please refer to the appendix section of this report.
Furthermore, the average daily trading volume of Tesla, Inc. shares is 132,160,233 for 30 days and 127,970,670 for 90 days, which, based on the current share price (i.e. $168.29), equates to a share value of $22.24 billion and $21.54 billion.
{| class="wikitable"
|+Tesla bid-ask margin
!Metric
!Amount
|-
|Bid price (USD)
|168.24
|-
|Ask price (USD)
|168.29
|-
|Spread (USD)
|0.05
|-
|Margin (%)
|0.0297
|}
{| class="wikitable"
|+Average Tesla shares trade volume
!Days
!Average shares volume
|-
|30 days
|   132,160,233
|-
|90 days
|  127,970,670
|}
{| class="wikitable"
|+Tesla shares trade volume over the last 90 days
!Date
!Volume
|-
|28/04/2023
|        122,515,800
|-
|01/05/2023
|        109,015,000
|-
|02/05/2023
|        128,259,700
|-
|03/05/2023
|        119,728,000
|-
|04/05/2023
|          95,108,500
|-
|05/05/2023
|        107,440,900
|-
|08/05/2023
|        112,249,400
|-
|09/05/2023
|          88,965,000
|-
|10/05/2023
|        119,840,700
|-
|11/05/2023
|        103,889,900
|-
|12/05/2023
|        157,577,100
|-
|15/05/2023
|        105,592,500
|-
|16/05/2023
|          98,288,800
|-
|17/05/2023
|        125,473,600
|-
|18/05/2023
|        109,520,300
|-
|19/05/2023
|        136,024,200
|-
|22/05/2023
|        132,001,400
|-
|23/05/2023
|        156,952,100
|-
|24/05/2023
|        137,605,100
|-
|25/05/2023
|          96,870,700
|-
|26/05/2023
|        162,061,500
|-
|30/05/2023
|        128,818,700
|-
|31/05/2023
|        150,711,700
|-
|01/06/2023
|        148,029,900
|-
|02/06/2023
|        164,129,000
|-
|05/06/2023
|        151,143,100
|-
|06/06/2023
|        146,911,600
|-
|07/06/2023
|        185,710,800
|-
|08/06/2023
|        164,489,700
|-
|09/06/2023
|        199,882,300
|-
|12/06/2023
|        150,337,900
|-
|13/06/2023
|        162,384,300
|-
|14/06/2023
|        170,575,500
|-
|15/06/2023
|        160,171,200
|-
|16/06/2023
|        167,563,700
|-
|20/06/2023
|        165,611,200
|-
|21/06/2023
|        211,797,100
|-
|22/06/2023
|        166,875,900
|-
|23/06/2023
|        176,584,100
|-
|26/06/2023
|        179,990,600
|-
|27/06/2023
|        164,968,200
|-
|28/06/2023
|        159,770,800
|-
|29/06/2023
|        131,283,400
|-
|30/06/2023
|        112,267,600
|-
|03/07/2023
|        119,685,900
|-
|05/07/2023
|        131,530,900
|-
|06/07/2023
|        120,332,100
|-
|07/07/2023
|        113,602,000
|-
|10/07/2023
|        119,425,400
|-
|11/07/2023
|          91,972,400
|-
|12/07/2023
|          95,672,100
|-
|13/07/2023
|        112,681,500
|-
|14/07/2023
|        119,771,100
|-
|17/07/2023
|        131,569,600
|-
|18/07/2023
|        112,434,700
|-
|19/07/2023
|        142,355,400
|-
|20/07/2023
|        175,158,300
|-
|21/07/2023
|        161,050,100
|-
|24/07/2023
|        136,508,500
|-
|25/07/2023
|        112,757,300
|-
|26/07/2023
|          95,856,200
|-
|27/07/2023
|        103,697,300
|-
|28/07/2023
|        111,446,000
|-
|31/07/2023
|          84,582,200
|-
|01/08/2023
|          83,166,000
|-
|02/08/2023
|        101,752,900
|-
|03/08/2023
|          97,569,100
|-
|04/08/2023
|          99,242,600
|-
|07/08/2023
|        111,097,900
|-
|08/08/2023
|          96,642,200
|-
|09/08/2023
|        101,596,300
|-
|10/08/2023
|        109,498,600
|-
|11/08/2023
|          98,866,600
|-
|14/08/2023
|          98,595,300
|-
|15/08/2023
|          88,197,600
|-
|16/08/2023
|        112,484,500
|-
|17/08/2023
|        120,718,400
|-
|18/08/2023
|        135,813,700
|-
|21/08/2023
|        135,702,700
|-
|22/08/2023
|        130,597,900
|-
|23/08/2023
|        101,077,600
|-
|24/08/2023
|          99,777,400
|-
|25/08/2023
|        106,612,200
|-
|28/08/2023
|        107,673,700
|-
|29/08/2023
|        134,047,600
|-
|30/08/2023
|        121,988,400
|-
|31/08/2023
|        108,861,700
|-
|01/09/2023
|        132,272,500
|-
|05/09/2023
|        129,469,600
|-
|06/09/2023
|        116,959,800
|}


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