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GT Advanced Technologies Inc. Message Board

  • ionlyreplitosmarties ionlyreplitosmarties Feb 20, 2014 11:01 AM Flag

    Screaming SHORT!!

    "However, portfolio manager John Stephenson of First Asset Investment Management is in no rush to buy Tesla's stock, which was trading at 137 times its estimated 2014 earnings as of Thursday morning.

    "Even if you consider it a technology company, the average [price-to-earnings multiple] in the technology sector is 18 so it's way overvalued," says Stephenson, who believes Tesla is at a disadvantage to many tech companies. "There's no possibility of it becoming mass market because the battery technology isn't even up to snuff and won't be there for years."

    Stephenson also doubts Tesla will be able to sustain its gross margins above 25%. "If you look at the margins of the competitors, BMW is 6.8% gross margin versus Daimler at 5.8%," says Stephenson. "If [Tesla] could achieve 25% margin continuously, then all obviously competition is coming in here."

    "This is a screaming short," says Stephenson.


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    • "There's no possibility of it becoming mass market because the battery technology isn't even up to snuff and won't be there for years."

      Did he say "battery technology isn't even up to snuff"?

      Well, guess who just flew in from Hong Kong and knows a thing or two about that and who will be called upon to help do something about it? Apple and Tesla have a common need and have friends in all the right places.

      What will Tesla stock do when they announces their new "safe, longlife, multicycle, safely-disposable, rechargeable battery"? Apple will make a similar announcement.

      John's jaw will drop.

    • Here's the difference. Tesla can hardly be said to have a business moat. Ford, BWM, Mercedes, Toyota, Porsche, and other car makers have R&D and channel to do anything Tesla can...and will if the electric car market proves worth developing.

      GTAT has a solid moat in emerging sapphire and solar markets. It's a question of these markets developing, not of where GTAT stands in them. Not quite the same with Tesla.

      If an Apple buys Tesla, sure, nobody is losing money. But I'll believe that when I see it.

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