We concede that TSLA should have some option value for its battery tech moonshot but a 1,160 PE ratio? Come on, man!
Toyota (TOY) currently trades at 8x earnings.
Tesla makes an incredible product, in our opinion, the best automobile in the world and no other comes close. Classic case of great company, bad stock with a junk credit rating to boot.
Best to trade this one like pork bellies or be Howard Marks (see Tweet below).
There is no free lunch and somebody or many somebodies are about to get seriously fucked, just as the TSLA shorts have been skewered over the past year.
Stock Splits – The New Free Money
Seriously, though, stock splits are the new, new free money. TSLA is up almost 75 percent since it announced its 5:1 split just a few weeks ago, which is tantamount to walking into a bar and asking to change a $50 bill for five $10 bills and having the bartender hand you back eight $10 bills.
But, hey, maybe there’s some scarcity value premium to $50 bills,
Gawd, we love efficient markets.