Tesla Daily is providing an update on Tesla. Rob discusses the fact that Benchmark funds need to buy Tesla.
SP500 index funds acquired Tesla shares Dec 18, 2020. They got in at $695.
Benchmark funds that did not get Tesla before are now down about 50 basis points or 0.5% when compared to the SP500 Index funds.
If Tesla went to $1400 the Benchmark funds that chose not to have any Tesla would be down 160 basis points. They would need to find ways of outperforming the Index funds by 1.6%. It would be safer for those managers to just get in and trade on other stocks where they knew they could win all the time.
Tesla is running now to $880 based upon the Benchmark fund buying frenzy. However, there is limited visibility into this action.
The earnings that Tesla will announce will be very good on Jan 27, 2021. We know this because of the announced 180,000 cars sold and delivered in Q4. Net income could triple. This would take some of the edge off of the people concerned about price-earnings ratio. However, Tesla is already up almost 30% from SP inclusion day (Dec 18) and it could double or triple again in 2021.
As Tesla, goes over $1000 per share again. They can announce another 5:1 stock split. The last time they did this it drove the stock price up 50%.
In the second quarter, the Berlin and the Texas factories could complete and start making cars. The 4680 pilot battery plant could ramp.
Tesla will have over $30 billion to drive expansion and execution. Tesla could raise another $10 billion for less than 1% dilution when the stock is over $1000. Tesla could buy Volkswagen for less than 10% dilution when Tesla stock is over $1000. I do not think Tesla will buy Volkswagen, but they can buy pieces of car makers or battery makers. If some of the legacy carmakers go under, then Tesla can scoop up factories like they scooped up the first Fremont plant.
When Tesla is at $1 trillion the domination game becomes easier.
I think a double in stock price from here in 2021 is very likely and possibly a triple. Tesla will produce 1 million cars in 2021.
SOURCES- Tesla Daily, Brian Wang analysisWritten By Brian Wang, Nextbigfuture.com (Brian owns shares of Tesla)
