Again, the annual deadline for ISA contributions continues. It made me think about how major stocks have been transported over the past year. For example, one-time stock market beloved Tesla (NASDAQ: TSLA) has taken hamm over the past year. But as an investor, what can we learn from Tesla stock performance this year since our last ISA contribution deadline?
Stock prices have skyrocketed over the past year!
This is not just a theoretical question for me. I think Tesla has a lot to do, from its large installed user base to its own technology and its booming energy storage department.
If I could buy stocks with what I thought was an attractive rating, I would be happy to own it. So I’ve been keeping an eye on the price to see if it reaches a point that I think will provide the right amount of value.
A lot of attention has been paid to prices that have been crumbling over the past few months. Tesla crashed 44% since December.
However, the long-term photos remain positive.
Over the past year, Tesla has scored 59%. So the £20k I invested in it a year ago is now worth around £31,750.
Continuous growth outlook – and concerns
There were no dividends during that period. Tesla has never declared a dividend despite its profitability.
Instead, it puts the extra cash to get back within the business. That’s a fairly common practice for growth companies.
Tesla has many opportunities to grow. It is one to update and expand the range of vehicles and sell higher volumes. But others are from the energy storage sector to unrevealed products like unmanned taxis and robots.
The first quarter was great for the energy business. This week, Tesla announced it had rolled out 10.4GWH of energy storage products in the first three months of the year. It was a big jump from the same period last year
In contrast, car delivery volumes fell 13% year-on-year (production fell 16%, but still significantly higher than delivery).
The stock price crashes over the past few months have partially reflected investors’ concerns about declining sales. byd With sales increased, Tesla’s brand continues to be influenced by boss Elon Musk’s popular profile in some markets.
The stock still looks high to me
Clearly, Tesla has tough sales challenges.
However, they have a large economy, a proven vertical integration model, and much longer experience than some of their rivals. I continue to see this as a solid business with a potentially strong future.
I was not prepared to invest a year ago because I felt it was too expensive. How’s it now?
Tesla trades at a price-to-return ratio of 131.
That’s very expensive for me, especially for companies with a challenging competitive environment where sales are substantially declining in their core business.
I’ll continue to keep my inventory on my watchlist without buying for now.
