Analysis of Tesla Motors share price

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The stock market shares of quoted large American companies are now available to investors through online trading platforms. Among them we have chosen to study those of the Tesla Group at this moment. In this article you will learn important practical information about the company’s activities and historical data from technical analyses of its rate over the last ten years.  

Latest news

Tesla ready to continue its development after good results in 2020

06/01/2021 - 13h43

Tesla marked the year 2020 in the automotive sector with an impressive rise. The automotive group is determined to achieve even better performance in the new year

Elements that can influence the price of this asset:

Analysis N°1

This is why, we advise you to carefully follow all the official statements made by the company and its direction especially concerning its Master Plan 2. The reaching of the objectives fixed by the company and the means used to achieve this will be very important. You should therefore put attention to all the financing solutions used by the company, the eventual strategic alliances and of course the group’s financial results.

Analysis N°2

Once again, we draw your attention to the importance of a good study of the competition, since Tesla Motors operates in a highly coveted sector because it is considered as the future. The race for electric and autonomous vehicles has been in full swing for the last few years and Tesla is not the only company investing a lot in these innovations. Each announcement of the manufacture or the release of a new vehicle from either of these companies could have a direct effect on the direction that Tesla Motors shares could take.

Analysis N°3

In conclusion, any important announcement coming from this sector of activity is likely to influence the price of Tesla Motors shares and represents an excellent entry point on the market with punctuated and highly volatile accentuations and trend reversals.

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About the Tesla Motors Group:

The Tesla Group, or Tesla Motors, is an American Company that specialises in the design, manufacture and sale of electric vehicles. However, its activities can be divided into various sectors including the sale of vehicles, the sale of motor-propulsion components for electric vehicles and the provision of development services.

Because of their two major production sites, they generally touch the American market but also China and Norway.


The major competitors of Tesla Motors:

Tesla Motors is specialised in the production of electric vehicles and therefore has had to face increasingly hard competition over recent years from other major vehicle constructors around the world which have launched into the ecologically friendly vehicle sector. To assist you in achieving pertinent analyses of the Tesla Motors share price we present here details of the major competitors to Tesla Motors in this sector:


The major partners of Tesla Motors:

Tesla Motors has also implemented various strategic partnerships that have enabled this company to keep its position as leader in this industry sector. Here are the major partners of Tesla:

In 2014 the French Group, Allianz, specialised in insurance, and more particularly its French automobile insurance subsidiary, signed a partnership with Tesla Motors thereby offering their services to clients of this automobile brand.

The Tesla Motors Group and the NVidia Company have also been partners since 2016 for the initial development of the largest tactile screen created for an automobile. NVidia already supplies the integrated leisure systems and digital dashboards for each of the vehicles produced by Tesla Motors such as the recent Model X.

Still in 2016 the Japanese Panasonic Group announced an investment of over 30 billion Yen in a Tesla Motors photovoltaic cells and modules manufacturing unit. This announcement spurred an increase of 30% in the Tesla share price during the trading period.


Price analysis of Tesla Motors shares:

The price for Tesla shares is currently quoted on the Nasdaq Global Select American market. It is also included in the composition of the Nasdaq 100 stock exchange index.


Important stock market data about Tesla Motors shares:

Let us now look together at some highly important information about Tesla Motor Company shares, and more precisely the Tesla Motors Company and its position on the national and international stock markets. This general information will be useful for you to gain a better overall understanding of this asset’s position on the stock markets and thereby assist in calculating a better analysis of its price in real time.

The shareholdings of the Tesla Motors Company are composed as follows: 13.5% FMRC, 8.23% Baillie Gifford & Co, 7.37% T Rowe Price Associates, 5% Tencent Holdings, 3.50% Vanguard Group, 2.39% BlackRock, 1.65% Jennison Associates, 1.62% MSIM, 1.41% State Street Corporation and 1.28% Capital World Investors.


Economic and financial history of the Tesla Company:

To better understand the historic stock market charts of Tesla Company shares and be able of analysing past trends it is important to know the events that marked the recent history of this company. This is what we offer here with some important dates and information from the last few decades.


How was the Tesla Motors Group financed?

The first investment that enabled the launch of the Tesla Company was that of the co-creator of PayPal, Elon Musk, who became President of the Executive Council of Tesla. He was also responsible for the initial two rounds of financing and co-directed the third round with Vantage Point Venture Partners. This last round led to the entry of new but well known investors such as Sergey Brin and Larry Page, co-founders of Google, and Jeff Skoll, previous President of the EBay Group.

In 2007 no less than 105 million dollars was raised by the group during a private financial deal whereby Elon Musk participated to the extent of 37 million dollars. Elon Musk went on to finally manage the group in 2008 following the departure of Ze’ev Drori, a Californian entrepreneur who had taken over from Martin Eberhard in 2007.

Following the launch of a network of around 3,000 superchargers that enable a full charge in less than 45 minutes, Tesla invested several billion dollars in the construction of a battery factory in Nevada to equip the Model 3. For this they had to raise around 4 billion dollars on the stock markets since 2013. It is important to note that the share price had multiplied by 11 since its quote price in 2010.

Finally, in 2017 Tesla again raised new capital amounting to 1.2 billion dollars by issuing 1.3 million ordinary shares and ceding first round convertible securities maturing in 2022.


What are the future possibilities for Tesla Motors?

Before taking a position on the course of Tesla Motors shares, you are probably wondering about the future of this company which has recently raised significant funds in the financial markets. For that, it is important to look at the commercial strategy put in place by Elon Musk himself.

More than 10 years ago, he launched the Master Plan, whose strategy was primarily based on the democratization of electric vehicles by leveraging on the profits generated by high-end vehicles, which would then be used to finance inferior sectors. But recently, Elon Musk has announced to the public his Master Plan 2, which specifies to investors and the press the plan envisaged by the directors of the company in the years to come.

The first thing that called our attention about this new strategic plan is a more diversified range of electric vehicles produced by the group including vehicles such as compact SUVs or pickups. We can also notice the manufacture and future commercialization of heavyweights, the Tesla Semi and of an electric bus.

In the long term, the group also announced the development of a range of autonomous vehicles with the launching of a fleet of self-driving vehicles and the possibility of sharing Tesla electric vehicles with other users when their owners are not using them. We also noticed that the takeover of the company Solar City, specialized in the installation of solar panels and created by Elon Musk cousin, himself, is an ideal solution to provide for the solar energy projects of the group, which the company had already talked about during the announcement of his Master Plan 1.

However, there are still some questions as to how these developments and projects will be financed. This is the reason why the price of Tesla Motors shares went down after the announcement of its Master Plan 2. Financial analysts estimate in fact that these projects could cost nearly 3 billion dollars to the company. It is easy to understand how the lack of data concerning the way they are going to finance those porjects, could influence investors who are doubting about their feasibility. The feasibility of this plan should therefore be closely monitored on the long term. On a first instance, we expect an increase in the cost of the company and thus a decrease in profitability with repercussions on this title on the stock market.

In addition to the money needed to carry out these projects mentioned in the strategic plan of Tesla Motors, particularly concerning the development of the SUV and the pickups, which could cost several hundred million dollars to the company, provided that they use materials already used by other manufacturers, some other projects could also pose a problem concerning the long time that it may take to manufacture them. This is particularly the case for the design of the heavyweights announced by the group which could take from 5 to 9 years to be manufactured and thus face significant competition by manufacturers specialized in this type of vehicles. If the company only relies on the sales of its electric cars such as the Model S, the Model X and the Model 3, it may encounter a significant financial shortfall and a certain delay in the realization of the projects initially mentioned.

Frequently Asked Questions

Is the Tesla stock part of NASDAQ?

The National Association of Securities Dealers Automated Quotations (NASDAQ) is the second largest equity market in the United States just behind the NYSE. It's an electronically and continuously managed stock market. NASDAQ collects technological stocks with great potential. Service provider equities and the industrial sector are also listed. The TESLA stock entered NASDAQ on June 29th 2010. And with a market capitalization of over $ 100 billion, the TESLA share is now one of the flagship values of NASDAQ.

When is the best time to buy Tesla shares?

Tesla shares are not a cyclical stock. In 4 months, its price was multiplied by 3 reaching a historic high of 968 dollars on February 4th 2020. The next day the share dropped a staggering 20%. This kind of volatility is typical of speculative values. The value maximisation is not based on the value of its assets or recurring profitability. The stock market only anticipates the growth potential of the company which could, over the next 5 or 10 years, become a leading car manufacturer on a global scale. Financial markets merely enhance the future value of the company. Investing in Tesla stock should be viewed from a long-term perspective. The best time to acquire the stock would obviously be after a stock market crash.

When is the best time to buy Tesla shares?

The Tesla share price has recently rocketed. Should I sell the share and collect the profit? It all depends on the rate you got it at. With a capital gain of 300, 400 or 500%, it's probably worth selling the share. As a matter of fact, its high volatility will offer the opportunity to buy the stock at a lower price later to make a new capital gain. Choosing when to sell Tesla stock depends on the investor's philosophical approach to financial markets. A speculator can seek a quick return on investment and regularly collect their profit even if it means buying and selling the same share several times. But investing in Tesla shares can also be a long-term bet. The markets are betting on a leading position for this company in the next few years.

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