ANALYSIS | MUSK COULD USE SOME EXTRA TESLA MOJO RIGHT NOW'
0Analysis | Musk could use some extra Tesla mojo right now'
Musk appeared on the conference call and began a litany of reasons why Tesla was set for an 'epic end of the year' despite supply chain issues. a strong dollar and 'China going through some kind of recession.' The tone came out a bit came across defensively as if the chief executive was looking for reasons to put the results on the back burner The richest moment was when he said Tesla market cap: $696 billion ended up being worth twice Saudi Arabian Oil Co. or Saudi Aramco would have. which is $4.2 trillion at current levels. Musk was careful to make a caveat with 'that doesn't mean it's going to happen.' which is certainly a possibility worth considering. Consider: In December 2020. Tesla announced it was selling $5 billion in new equity when the stock was trading at around $217 n announced a share sale. Today it is only 46 times. I think from a certain perspective that looks like bargain prices. The bigger problem is that Tesla is sticking to a 50% annual growth target. which means vehicle sales will grow from just under a million units last year to more than 10 million by 2027. That's not to smack ambition well. maybe a bit on the robot but rather to say that all of this is going to take a gigatonne of cash to pull off. It's worth noting that the slight disappointment in third quarter sales is due to Tesla's sales spending falling to less than 5% of sales. Selling. general and administrative expenses are now strikingly where sales were a third down. This seems to point in the direction that more spending is needed instead of less.'
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