Given the continual rise of Tesla after the S&P500, it is worth looking back at the compensation package that musk agreed with Tesla in lieu of pay.
It is documented here.
https://www.businessinsider.fr/us/elon-musk-tesla-compensation-package-tranches-explainerAnd I'm going to look in reverse order at the tables.
First, market cap.
Now at the time of agreement, in 2018, the Shorts laughed themselves silly. Tesla was valued at $57bn. So a target of 650bn was deemed totally ludicrous.
Today, at $544bn, they are no longer laughing.
I did a ROM on what it would take for Tesla to meet the top target of 650bn and came out with around $700. Given that, today, Tesla is pre market at $579, it is a short hop to $700.
Even then, given the current market sentiment, it is only a week or two before Tesla hits 10 out of 12 on that list.
Granted it could crash, but it would take some pretty bad news, like a refusal to give approval for Giga Berlin and an order to take the factory down and make the site good. This is not on the cards today.
Then there are the operating goals.
So the second goal will be missed, very closely, by the most optimistic evaluation of deliveries in 2020. At the average vehicle price for Q3 ($63k), lower than both Q2 and Q1, Tesla would have to deliver tens of thousands of vehicles over the 500k bracket to make the second operating target.
2021 is, however, a different story. The run rates of Fremont, today and Shanghai (estimated), run to combine to 1.11m vehicles.
Of course we need to factor in price drops. Average vehicle prices dropped by $4,700 from Q1 to Q3 this year. So if we take that off the 63k value as an estimation of 2021 price drop, we get $58k.
Roughly 1.11m vehicles at circa $58k means $64bn in revenue. Profits are expected to be higher with high volumes of Shanghai M3 (and MY??) being sold in Europe. This has already begun and we can expect it to continue.
So targets 2 and 3 crushed on the operating goals sheet.
However, this ignores both Berlin and Texas. Both larger than shanghai but, at the same time, only in phase one and ramp up. So let us say 6 months to deliver 100k vehicles each of the 500k target (assuming the Texas target is the same as the Berlin phase 1 target).
That gives me 1.31m.
That gives me $76bn and knocks off 4 of the 8 on the target list.
Taking this to the logical conclusion, let us say that peak output would be at an average vehicle price of $40k. Then working backwards, Tesla needs to deliver 4.4m vehicles per year to meet the operating targets, with around $176bn in revenue.
So what does it take? Another 3 factories? I guess it depends on whether you believe the "leaks" or not.
We have been leaked that Shanghai's final output is sized at 1m per year.
Ditto Berlin leaked at 2m per year
Even if we assume Fremont stays static (poor assumption), Fremont will continue to produce 560k per year.
That leaves another 840k from Texas to hit the 8th and top target on that list.
So, I guess, the only question is, whether Tesla can hit 4.4m vehicles (assuming an average selling price of $40k), by 2028, or not.
Odds anyone?