Tesla Motors chairman Elon Musk plans to take the company public before the end of the year. Before you call your broker to get in on the ground floor, think twice. Blogging Stocks' Zac Bissonette advises prospective investors to "stay away!" He doesn't base this advice on any of Tesla's financials. In fact he says he hasn't seen a registration statement or prospectus. Instead, he's looking at the money that initial investors lost in the airline industry, the hundreds of startup automakers over the years, the internet bubble that went bust and the struggling satellite radio companies. He reminds us that "world-changing technologies often fail to lead to profits for the investors." And then he offers this last bit of advice: "If the Tesla IPO is a hot one and investors start dumping boring profitable companies to pile in, I say take the hint and run the other way." You have been warned.
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Story redux:
“Some stock blogger thinks the Tesla IPO won’t do well. He knows nothing at all about the company or its financials, but bases his prediction on a general pessimism regarding technological innovators. Clearly, Tesla’s death is imminent.”
Come on guys; you’re really reaching for things to whine about at this point. If you don’t have any actual news to report, do you think you could refrain from making up excuses to complain?
Actually Hunter, most IPO’s don’t make money. In fact, it is often smart to wait a few weeks until the stock price comes down to the level it should be at before buying a stock that just had an IPO. That is just basic finance knowledge.
But I agree, this “news” does not warrant a “Tesla Death Watch” title.
BlueEr03
But I agree, this “news” does not warrant a “Tesla Death Watch” title.
Fair enough. Since this advice is based on past performance of other IPOs, and isn’t directly related to (known) problems with Tesla Motors’ finances, I’ll remove the “Death Watch” designation.
However, we’re not picking on Tesla. We’ve reported on other companies’ stock issues, and we’ll keep watching Tesla as it goes public.
Yeah but, if you got the stock at the initial price and sold quickly couldn’t you make a bundle? I’m sure Tesla stock will skyrocket when it first hits the market. Not that I would try this but I’m sure Elon Musk some savy investor will find a way to profit from it.
They already made the movie. “Tucker: The Man and His Dream” directed by Francis Ford Coppola, staring Jeff Bridges as Preston Tucker.
Of course there are some differences. Tucker actually built about 50 cars.
Here is a title for the Tesla story movie: “Musk, The Man and His Odor”.
Musk stinks…
Tesla makes and sells one model. Reminds me of Saturn when those first hit the streets. How many years are they going to sell this unchanged model?
Building a new factory from the ground up to build automobiles in Arizona or where ever is no small endeavor. That one little venture could bankrupt the company.
So now they think they can take on Toyota and Honda and rule the automotive world building their very own car(whitestar)?
So now they make and sell two models. How well does AC performance scale up? How much more performance potential exists in those motors? Does the existing motor have a lot more performance and the inverter is the limiting factor? Or are you battery limited?
I think the institutional investors will be smarter than the individual investors who gave Tesla its kick-off cash. They will look at sources of future income and see two products, one in an everlasting state of development (The Roadster) which, even if fully developed, will never be more than a niche product due to its format (two-seated roadster??). The other product is the Whitestar, which exists only in our imagination. Not a complex analysis here – until Tesla has a product, a distribution network and a customer base, the stock will be a speculation stock.