I’m on a journey to make 30 predictions in 30 days – and strengthen my decision making abilities in the process. Join me on the journey by shooting me an email with your thoughts and predictions.
Tesla Motor company's stock will increase another 10% this year and another 30% by the end of 2017.
Yes - this is my second stock prediction that I am making in 5 days. Someone recently recommended that I read Tesla founder Elon Musk’s first blog entry outlining the strategy for Tesla back in 2006 (click here to read it). What is remarkable is that he lays his blueprint out very clearly with a focus on being energy efficient, using batteries that can be reused, and selling a high end car that will fund Tesla’s expansion into affordable cars.
Musk goes so far as to say that, “ the second model will be a sporty four door family car at roughly half the $89k price point of the Tesla Roadster and the third model will be even more affordable.”
That car that was released last week and it is $35k dollars. Unfortunately, there is already a waitlist of over 200k people - each of which paid $1k to be on a list for a car that will begin to be produced and released in 2017.
I can’t remember the time when so many people were excited for a car that was built for mass production.
I believe that Tesla Motors is revolutionizing an industry that has failed to adapt to the times. Remember when the CEO’s from the Big Three auto companies flew to Washington D.C. on private planes to petition for a $25 Billion dollar government bailout? It’s an industry with little awareness - no wonder it was ripe for a strategic innovator like Elon Musk to make a dent.
The only hesitation that I have is that Tesla needs to a) significantly increase their production speed/output and b) sell all those cars in order to truly justify their price earnings ratio at the current stock price of $250 a share.
But the market prices stocks based on the future - not necessarily on what the company is doing today.
Tesla is building an auto company like a startup. Building demand ahead of supply. Driving anticipation (pun intended). Using design and access limitations to posture itself. Targeting buyers that are influencers and forward thinkers - which will eventually cross over to the hearts and minds of a larger population of potential buyers.
Tesla is just getting started and they have the brains the momentum, and the DNA to do it. They are creating excitement around an industry that has really failed to innovate.
Sound familiar? Think Apple.