TSLA - Tesla: Insurance Network And FSD Are A $195.15B Untapped Revenue Stream

2024-06-17 09:30:02 ET

Summary

• Tesla, Inc.'s $25K Model 2 project is still ongoing, leading to a 36.61% stock rise since its lows after reports of its potential cancellation.
• Tesla aims to sell 20M cars by 2030 and start producing $25K vehicles by 2025, while also expanding into AI, robotics, and vertical integration.
• Tesla outperforms BYD Company in operating and net income margins, FCF, and cash reserves. EU tariffs on Chinese EVs reduce BYD's pricing advantage.
• At full potential, FSD, Insurance, and Tesla Charging Network could add revenue streams totaling $195.15B.
• Tesla's fair stock price is estimated at $239.95, with a potential future price of $494.82 by 2029, indicating strong growth potential. The stock is rated a "strong buy."

Thesis

In my previous article on Tesla, Inc. ( TSLA ), I covered news that said that Tesla had scrapped its affordable Tesla Model 2 project (which is Tesla's $25K car) and will focus on the RoboTaxi (an autonomous taxi) project. This article, which Reuters originally published, sent shockwaves through Tesla's stock. Nevertheless, the stock recovered a little and, since then, its price has risen by around 4.80%.

In that article, I explained why Tesla could survive without a $25K car offering by demonstrating through a model that if Tesla sold 3.89M cars by 2029 with an average price across all models of $58K, the fair stock price would be $255.68, and the future stock price for year 2029, 555.55.

Nevertheless, Tesla announced that it hadn't scrapped its affordable EV project , which helped push the stock up by 36.61%. Nonetheless, Tesla's stock remains 26.38% down year over year....

For further details see: