In a video interview, Aswath Damodaran, a renowned figure in the investing world, has disclosed his purchase of Tesla Inc TSLA stock at approximately $180. This revelation has sparked discussion among investors, with Redditors at r/ValueInvesting sharing their thoughts on whether Tesla is a good buy at its current price.
During the interview, Damodaran talked about how the Magnificent Seven stocks saved the market in 2023. He discussed his investment in each of these stocks, highlighting that he bought Tesla stock just a week back at $180 a share.
Shares of Tesla are currently trading just below $180. Here’s what Redditors have to say about Tesla stock’s price right now.
Some Say It Is An Opportune Time
Redditor solodav highlighted that Damodaran, known for his valuation expertise, made the purchase at what seems like an opportune time. Damodaran has a history of buying without requiring a margin of safety, emphasizing his willingness to buy at or below intrinsic value.
Warhawk_1 recalled Damodaran’s previous actions, noting that he bought Tesla when there was a high bankruptcy risk but sold early during the beginning of the bull run when positive gross margins were achieved.
Redditor daynighttrade defended Tesla’s diversified offerings beyond cars, citing the vast charging network and advantages over legacy automakers by avoiding dealer markups. He compared Tesla to Apple, emphasizing the broader perspective.
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Others Expressed Caution
Some Redditors expressed caution regarding Tesla’s current situation. namron79 pointed out concerns, including the absence of delivery guidance for the year, economic challenges in China, and uncertainties around Model 3 refresh qualifications for tax credits.
Redditor ughthat raised concerns about Tesla’s P/E ratio of 40, increased competition, and regulatory scrutiny. The sentiment leaned towards skepticism, waiting for substantial evidence that Tesla is more than just a car company. “With the current trajectory I think everything above $100 is overvalued,” the Redditor stated.
Teembeau expressed skepticism about purchasing Tesla shares, citing concerns such as its high P/E ratio, a market capitalization surpassing that of the top five automakers combined, and the difficulty of overcoming consumer brand loyalty. CEO Elon Musk‘s conduct and doubts regarding the company’s self-driving technology were also noted. “Everyone knows that self-driving doesn’t work,” the Redditor wrote.
Technical Analysis Suggests Support At $160
ChungWuEggwua suggested that Tesla’s stock could potentially drop to the $160s, finding support based on technical analysis. However, the Redditor highlighted the importance of Tesla proving itself beyond being just a car company.
Investors are encouraged to conduct thorough research, consider various perspectives, and assess their risk tolerance before making investment decisions. As Damodaran’s purchase prompts discussions, it underscores the dynamic nature of investment choices and the importance of individual analysis.
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Photo: Sheila Fitzgerald/Shutterstock
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