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Tesla Stocks' Floating Price Is a Dangerous Game to Participate

Author: Igor Balanchuk
17 September 2020, 15:42
Votes: 4

The stock prices of car manufacturer Tesla (TSLA) are steadily growing for about a year with only three downfalls during this period. The last negative tendency began in September and lasted for a week. Will TSLA stocks continue to grow or fall? Login Casino examined the latest financial news and trends to sum up all the factors influencing Tesla stock prices.

Tesla Stocks' Floating Price Is a Dangerous Game to Participate

Why does stock for Tesla receive such wide attention?

A stock exchange is one of the most prospective and dangerous places at the same time. One can receive millions or even billions of dollars from one deal, while others can lose all their money. However, the development of new technologies and immediate access to a variety of information sources makes the process of earning money via stock exchanges not so random as it was decades ago. Machine learning allows processing massive amounts of data while AI in games and gambling industry helps to develop profitable but balanced winning systems.

In such a new reality, prospective technical giants are using all the available sources to increase their influence on the market. A firm's appearance on a stock exchange is the target for most companies, as it's a sign of global goals, perceptiveness, and influential status in the business world. The Initial Public Offering of Tesla (named TSLA) was in the middle of 2010 with a price of $17 per share in NASDAQ. If someone invested in Elon Musk's firm in 2010, they would probably be very satisfied with their predictions. The recent capitalization and development level transformed the firm into a tech giant with a few hundred dollars per share.

SpaceX and Mars conquering as the representation of huge plans

Despite the fact that modern people have probably heard about Tesla electric automobiles, much fewer know that this company has a broader pool of interests and achievements. Thus, Elon Musk was actively promoting the space fly for the Tesla Roadster. Moreover, the car passed the Earth's gravity on a Falcon Heavy rocket that was produced on another Musk's firm - SpaceX.

The price of Tesla is not only electric vehicles

While Mars exploration is still a dream for the upcoming decades and cannot be considered a serious business project, but manufacturing and producing solar panels is a reality. Tesla Motors creates a prospective production circle around the cars it produces, adding to it a battery fabrication. Furthermore, they are promoting an idea of a million-mile battery, which should change the game rules and order in the electric vehicles industry.

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Is Tesla leading a software race in the automotive industry?

Another part of Tesla's influence is the software part of automobile creation. Thus, Musk insists that their corporation created an Ai-driven car that can be driven without any physical presence of the alive person, while the skeptics ask reasonable questions about the conditions that help to control such an automobile without human presence. Nevertheless, Tesla is actively fighting for the creation of unified software for autonomous vehicles that will allow implementing autopiloting on the roads.

Growing manufacturing and sales rates

Even the COVID-19 didn't ruin Elon Musk's plans. Thus, Tesla manufacturing was among the first that presented a safe workers' approach and continued production of the cars. During the first quarters of 2020, about 200 000 cars were produced, while opening new factories in Shanghai and Fremont would only increase those numbers. The fact that Tesla is building new production facilities is also increasing the confidence that the company is developing in the right direction.

All these aspects increase investors' interest to buy Tesla stock shares and join a rapidly growing tech firm. It's easy to calculate the profit of a person who has bought the considered securities for $17 (a 5-for-1 stock split skipped in this article), which now are fluctuating around $2000 per share. The income can be compared to those who forecasted Bitcoin price 10 years ago and bought a few coins in 2010.

Tesla stock: price of Tesla is overrated?

Nevertheless, many experts consider Tesla's stock price highly overrated and expect a rapid downfall when all the pitfalls come on the surface. We live in the world when media popularity makes things more critical; at the same time, people can quickly check the information and define if everything is true. Interestingly, Tesla's case is one of the hardest to analyze, so we'll highlight drawbacks to make decision-making fair enough.

Financial tricks and doubtful profits in Tesla Motors

tsla stoc: price of tesla

One of the most evident elements that stay against the high prices of TSLA shares is the firm's financial situation. Even though the company showed profits since the middle of 2019 and entered the list of the S&P 500, some authorities doubted such economic balance sheets. Bloomberg even asked to check if the company compliance with Generally Accepted Accounting Principles.

Simultaneously, the manufacturing facilities like in New York were built using about 1 billion dollars of taxpayer money, which shows that the company's financial situation is in the shade a bit. It's hard to forecast the profits when all the producing factories are finished and begin working in full capacity, but now there are plenty of questions concerning Tesla's real finances.

Tesla's competitors on the market of electric vehicles

Another controversy relates to the automotive market, even if we focus on electric vehicles only. Even though Tesla holds the biggest market share in terms of electric car sellings in the first half of 2020, its share is 18%. The nearest competitor VW Group has 12.6%, while Renault-Nissan-Mitsubishi Alliance is third in this rating and holds almost 9.5%. Of course, Tesla's manufacturing capacities look astonishing, but the global market is actively developing. Thus, car manufacturers cooperate to take more influence on the market and build shared battery plants. Moreover, new producers are showing quite similar growth rates as Tesla does - a Chinese manufacturer, NIO, increased their stock by 350% over the last 12 months compared to Tesla's 400%. It means that Tesla is still the most significant player in the market, but global competition becomes more rigid and should be considered when praising Musk's firm.

How far has Tesla's autopilot gone?

It is hard to claim when the autonomous driving software will be presented, so we'll focus on the recent facts. According to Elon Musk, he is already riding to the work with almost absent interventions, while he also claimed that such software should be created from scratch using another programming paradigm. Some experts don't believe in this idea until specific roads with the necessary sensors and controllers will be built, which looks reasonable today. It means that opening a robotaxi has to pass a long way or make a quantum leap at least.

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Tesla's law violations

It sounds a bit paradoxical, but Tesla electric cars are polluting the environment. Of course, there is no harmful emission while one of Tesla's Model cars is riding, but the manufacturing process is not perfect at all. Thus, the electric automobile producer received numerous fees due to laws violations, including paint and inflammable materials' wrong usage and storage. Adding a complex issue of batteries' production and utilization, Tesla is not looking as the promoter of a "green" environment.

Controversial Elon Musk personality

That is another item that can be stated in both advantages and drawbacks of Tesla Motors. Even though it's hard to underestimate the role of Elon Musk in the company's success, he is the person who can harm the whole corporation. His controversial Tweets, biased sayings, and unfounded statements seem to be the primary reason why Tesla stock prices are fluctuating so much today, while Tesla's option chain is hard to build and forecast.

All these reasons force one to think about the perspectives of buying Tesla's shares. The highlighted disadvantages are bringing a balance into the current optimistic situation with TSLA prices and avoiding drastic changes of short interest.

NASDAQ TSLA: changes' overview

The ten-years' period of Tesla shares being present on NASDAQ can be divided into 3 major periods. The first one was since IPO and till April 2013, when the prices were fluctuating around $20 per share, which was a rather similar result to starting at $17 on an opening day. The next period to look at was from April 2013 till December 2019, when TSLA stock could be bought for an average of $200. Even though the ten-times boost (from $20 to $200) seemed to be a success for shareholders, the year 2020 brought a new wave of popularity for Tesla.

tesla stock predictions

The highest point the TSLA stock achieved was almost $2500 per share at the end of August. Despite the fact that many experts doubted even a $1000 point for TSLA, the Musk-owned car maker showed that everything is possible. September 2020 can be considered as the period of most instability. For instance, the last summer day finished with the price of around $2500 per share, but a drastic downfall decreased the cost to about $1600 per share on September 8. September 14 ended with a price of $2100. It means that TSLA shares lost 36% in one week, but regained 37.5% during the next 7 days.

Tesla stock predictions

Stock exchanges are the place for risky people who are ready to bet their funds and hope for success. TSLA shares seem to be a perfect fit for such a game, as they can grow or fall more than 30% in only a single week. Unfortunately, making predictions for future changes is a tough task, even knowing the market's situation and analyzing all the drawbacks and advantages of the firm led by Elon Musk. However, if one is sure that today's short interest or option chains for TSLA stock are suitable for the risk - he or she is welcomed to make a bet.

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Frequently asked questions

What is the price of Tesla stock?

The price of Tesla stock varies significantly in recent months, so it should be checked on the online platforms that present NASDAQ share prices, where TSLA stock is traded.

Should I buy stock in Tesla?

It depends on your level of a market analysis or simply gut feeling. Today, experts are divided into two opposite categories, overestimating and underestimating TSLA stock prices.

How to buy stock in Tesla?

One has to become a broker at the NASDAQ Stock Exchange. As of now, Tesla doesn't have the option of directly selling its shares.

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