TSLA will join S&P 500 on December 21!

[VI Tesla]

https://www.cnbc.com/2020/11/16/tesla-stock-jumps-on-news-company-is-joining-sp-500.html

Finally

This'll be interesting to see how it will practically roll out!

'But adding Tesla is no easy feat after the stock’s record run pushed the company’s market valuation above $380 billion, making it the largest company ever to be added to the S&P, according to analysis from equity research firm Baird.

According to S&P Dow Jones Indices, there’s over $11.2 trillion in assets benchmarked to the S&P 500, with roughly $4.6 trillion of the total in indexed funds.

“Due to the large size of the addition, S&P Dow Jones Indices is seeking feedback through a consultation to the investment community to determine if Tesla should be added all at once on the rebalance effective date or in two separate tranches ending on the rebalance effective date,” S&P said.'

 

[TeslaHugger]

This is awesome. I bought a few shares just waiting for them to join the S&P500. I didn't think it would happen so soon. Should have bought more.

 

[VI Tesla]

This is awesome. I bought a few shares just waiting for them to join the S&P500. I didn't think it would happen so soon. Should have bought more.

Yah, that 's always the case. Wish I could have bought more.

 

[FutureBoy]

I’m curious how this will play out for the stock price over time. In the short term, as the institutional funds but in, the price will certainly go up. But there are already so many people who think that Tesla is over priced. So once the price has gone up a while I’d expect the unbelievers to cash out which could cause the stock price to fall some what.

But the bulls with true belief will continue to hold. So I’d expect that while the price might come back down some, I wouldn’t expect it to fall back to the current levels. But with the higher price, I’d expect that new buyers might be priced out. So perhaps that stabilizes he price a bit?

Plus the index funds don’t jump in and out except to rebalance periodically. So that should also stabilize the price a bit.

Or I might just be totally clueless about all of the above.

 

[T3slaDad]

I'm a firm believer that Tesla is going to 3x every year over the next 3-5 years. There are so many developments that they are accomplishing during this critical time frame that everyone who didn't buy and hold each year will be saying "man, I wish I bought some!"

Also, remember that many options exist to buy partial shares now, and even after they join. If anything, put away a few bucks each paycheck and buy fractional shares of Tesla so you're not kicking yourself in 5 years! You know Tesla isn't going out of business, so what's the risk of a few bucks each check?

 

[C T Rick]

I bought in March. Sold off enough to pay for the 40 pre split/ 200 that I currently own.

So my 2 motor might go to his and hers or 3 motor his and hers.

Let’s see what the final trim options will be priced at to see if the wife gets one too?

Rick

 

[TerryMack]

I'm a firm believer that Tesla is going to 3x every year over the next 3-5 years. There are so many developments that they are accomplishing during this critical time frame that everyone who didn't buy and hold each year will be saying "man, I wish I bought some!"

Also, remember that many options exist to buy partial shares now, and even after they join. If anything, put away a few bucks each paycheck and buy fractional shares of Tesla so you're not kicking yourself in 5 years! You know Tesla isn't going out of business, so what's the risk of a few bucks each check?

My Tesla Stock went up 4.5 times in the first year!

 

[TeslaHugger]

My Tesla Stock went up 4.5 times in the first year!

I wonder if there are still people who bought Tesla way back when it was $10-$20 range who have still kept their stock. I'm sure some of them sold when it went up to $300 or even $800.

 

[Faffle]

I bought 100 shares a few weeks back, rough price of base model CT. Maybe it will go up enough to upgrade my CT. I believe in Tesla's ability to expand in both vehicles and batteries so i was long term before the s&p 500 news. This news is very encouraging.

 

[T3slaDad]

I wonder if there are still people who bought Tesla way back when it was $10-$20 range who have still kept their stock. I'm sure some of them sold when it went up to $300 or even $800.

Talk to many of its early employees who invested in the ESPP plan. They would have been foolish to sell their stock then or even now unless they needed it!

My motto has always been, invest in the company you work for as if it's a 401k. Never touch it unless you absolutely need to, know there's something that will bring exponential higher returns, or unless you foresee the company going under. All my company stocks over the years have paid off very nicely by not touching them, and the only time I sold any was to convert them into TSLA because I saw the insurmountable potential early on.

I'm a very happy camper, but man I wish I also converted my 401k into TSLA back then!! Oh well, stock hindsight is always 20/20. I can't complain with my returns so far ?

 

[Crissa]

Keeping money in the company you work for is putting all your eggs in one basket.

Companies don't always do well. And when yours doesn't, they hit both your 401K and your paycheck.

-Crissa

 

[T3slaDad]

Keeping money in the company you work for is putting all your eggs in one basket.

Companies don't always do well. And when yours doesn't, they hit both your 401K and your paycheck.

-Crissa

To clarify, I wasn't meaning invest in your company instead of a 401k. I meant if you participate in an ESPP plan (discounted shares) in addition to your other investment routes, don't turn around and sell the stock unless you have to, find a much better ROI, or think the company's going belly up.

Don't put your eggs in one basket. Don't invest in what you don't know. Only invest what you're willing to lose. Etc...

 

[ldjessee]

I participated in two ESPP in my career so far. The first one, I sold them as soon as I could. The stock was rising quickly (split twice in 3 years), but I sold them as soon as I could, because I was a struggling single father at the time and I needed money on hand more than I needed future money.
People laughed at me, told me I was throwing away money. Then in a quarter, due to incompetence and criminal mismanagement (in my opinion), the stock plummeted and the next quarter it was delisted.
Those who had held on lost everything, mostly due to blackout periods (where as employees, we could not buy nor sell stock).

The second time, I kept them. I was in a much more financially stable place, could wait on the returns. Those sat even after I left the company, but then they became publicly traded, my share converted to the new publicly traded ones... and I diversified into a managed fund... and lost most of it in the several stockmarket falls since.

This has lead me to my opinion that the stock market is gambling for crazy and/or rich people. It is nothing you can rely on nor depend on unless you can sink a lot of money in... and not really care if that money goes away.

Just my opinion though.

 

[MEDICALJMP]

Analyst Sees Tesla At $578 On A Decade Of Hypergrowth, Says EV Credits Don't Matter.


Mohit Manghnani
Benzinga Editor
https://www.benzinga.com/analyst-ra...de-of-hypergrowth-says-ev-credits-dont-matter

New Street Research Managing Partner Pierre Ferragu said that electric vehicle credits for Tesla Inc TSLA 1.21% are short-term and will go away in three to four years. He added that EV credits do not factor in his earnings model, in an interview with Fox Business.

The Tesla Analyst: New Street Research analyst Pierre Ferragu upgraded Tesla to Buy, with a 12-month target of $578.

The Tesla Thesis: Ferragu said that EV credits do not matter to Tesla's profit as the $1.5 billion credit this year is like free money that Tesla will re-invest in its business.

Ferragu added that he doesn't value Tesla based on its current year's profit as it is trading at a multiple of 100. According to the analyst, what matters is how Tesla will do in 2025. He sees the Elon Musk-led company making $16 per share just from the automotive business by 2025.

More importantly, the $16 earnings per share do not factor in EV credit revenues as it is "going away relatively rapidly in the next three or four years," he said.

In his view, Tesla's gross margins excluding credits are about 20%, which is a leading gross margin for an electric car manufacturer. The margin will continue to expand with the higher-margin Model Y.

His research estimates that Tesla had an addressable market for 20 million units. The Model S, 3, X, Y directly addressed 8 million units with an additional "trading up" opportunity of 12 million units. The Cybertruck adds an extra 3 million units.

Why It Matters: Morgan Stanley had upgraded Tesla with a $540 price target, and S&P 500 added the automaker's stock to its index.

Ferragu, in a tweet, said that he didn't care for the company's inclusion in the S&P 500 index, and the move did not feature in his outlook for Tesla.

Price Action: TSLA shares closed higher by 10.20% at $486.64 on Wednesday.

 

[CEB12]

I’m curious how this will play out for the stock price over time. In the short term, as the institutional funds but in, the price will certainly go up. But there are already so many people who think that Tesla is over priced. So once the price has gone up a while I’d expect the unbelievers to cash out which could cause the stock price to fall some what.

But the bulls with true belief will continue to hold. So I’d expect that while the price might come back down some, I wouldn’t expect it to fall back to the current levels. But with the higher price, I’d expect that new buyers might be priced out. So perhaps that stabilizes he price a bit?

Plus the index funds don’t jump in and out except to rebalance periodically. So that should also stabilize the price a bit.

Or I might just be totally clueless about all of the above.

Maybe the price will rise as it did in the past and that would bring about another split to bring the price per share down again. So many people missed out on Tesla when the share price was at 49.00 and was to expensive at 1700.00 but the split brought it down to 356.00 putting buyers back into the market. My 2 cent worth!