It sort of twigged. Why do some analysts have such loony share prices on Tesla? Take this Nomura analyst with a $500 target price which for a company losing $16mn a day would make it a $90bn market cap company, or more than BMW, Fiat Chrysler & Yamaha combined. However when looking at the analyst’s other coverage it is all tech stocks – Intel, Nvidia, Micron etc. So for a company like Tesla that competes in the auto industry, sells automobiles and has to abide by auto regulations somehow a tech analyst is the answer.. Perhaps a tech analyst covering autos is the way forward so they can put zany valuations to justify poorly executing companies. As an old autos analyst myself, if I told technology related investors I was covering Intel, they would laugh me out of the meeting room.
In any event maybe the Nomura analysts’ other coverage is wrong. Perhaps he should be comparing Tesla to all those other tech stocks that have been such dreadful investments, lost billions and floundered. I once did a study which showed that over the last 25 years that Intel made 60% more net income on its own than Sony, Panasonic, Sharp, Toshiba, NEC, Mitsubishi Electric, Hitachi, Fujitsu, Fuji Film, Canon, Nikon, Advantest, Tokyo Electron, Nidec, Konica Minolta, Casio, Seiko, Kyocera and Olympus combined.