Tesla has gone through plenty of smear campaigns by mainstream media and us the alternative analyst are already used to it. We follow it closely, ignore the noise and hold Tesla shares.
This quarter yet again, Wall Street and the media dramatically underestimated Tesla. Yet again. I don’t understand how these people are so far off the mark every single time. But that’s beside the point.
But, let me start from the beginning.
Tesla’s Q1 results were entirely uneventful. However, within this boredom, Elon Musk managed to drop three bombshells.
Let me walk you through.
1. Outperforming estimates
Tesla smashed practically every record, such as revenues, profitability, and cash on hand if you include its Bitcoin position.
Wall Street put a consensus of 77 cents per share. They saw extremely positive delivery numbers in Q1 and came out with a number they thought Tesla could never meet.
Undeniably, 77 cents per share was an optimistic number. But just like in the story of David vs. Goliath, Tesla managed to beat the consensus numbers with 93 cents per share and a 74% revenue growth, with 10.4 billion in revenue in Q1.
And they did all that after dealing with the lockdowns, not making any model S or X, and dealing with the worst semiconductor shortage in history.
2. Model Y prediction
The second bombshell Elon dropped was eye-popping. He said Model Y will be the best-selling vehicle in the world by the end of 2022. And I wouldn’t bet against Elon. He has a track record of delivering on his promises. Needless to say, Elon has just sent two astronauts into space.
To put this in perspective, the best-selling title is currently at the hands of Toyota, with 1.5 million Corollas sold a year. Don’t get me wrong; Corolla is a good car. But Elon is betting that Tesla will produce 1.5 million of the Model Y only. Not to mention, Tesla is selling Models 3, S, X, and soon Cybertruck and the new Model Zero. That means we’re looking at probably 2.5 million deliveries in 2022, which would be an insane growth.
3. Decentralized energy
And the last bombshell was massive but highly underwhelming in the way it was delivered. The Tesla energy business grew by 100% in revenue in Q1. And on the call, can’t meet the demand and turning away the clients.
We know Tesla can produce and store electricity. But this is the first time that Elon spoke about redistribution of electricity. Of course, this is just the first stage where he can redistribute power during extreme weather conditions. But what he said is they can distribute their own decentralized energy.
That would mean a revolution in the most antiquated and unfair industry. This is a massive statement for the long-term vision of Tesla.
Now you have to realize all these breakthroughs happened while Tesla managed a healthy $17 billion cash, repaying $1.2 billion in loans and building two new factories.
It’s a company with a 50% average compounded growth rate.
And this is the point I want to emphasize.
Tesla is growing too fast to accurately estimate how many vehicles they will produce in the year. They have two gigafactories under construction and two more currently expanding and increasing the production. It’s one of the biggest companies in the world, growing at the rate of the startup.
And since the Wall Street gang is too short-sighted, they miss the opportunity every time.
Additionally, you have to keep in mind they’re more than a car company. Just like Apple changed from a computer company to what they are today, Tesla is transforming into an AI, autonomous software, and energy company at the very least.
So for those of you that understand the opportunity and ignore the mainstream FUD, it’s the perfect time to discount shopping. Wall Street shortsightedness is our gain as they provide discount opportunities.
Dan Ives from Wedbush securities estimates the price to reach $1,000 by the end of this year, and Cathie Wood’s price target for Tesla by 2024 is $7,000.
The recent dip may have been the last time we got a significant pullback due to the gift from the Wall Street analysts. So, just buy and hold and look to add some more as short-term issues arrive.
It could be your last chance.