It has been a long time coming but Tesla is finally starting to be valued like and automobile company – which it is. That means it has to compete with numerous experienced companies in a highly capital intensive industry. It also has to deal with the same labor relations that other car companies do. At $300 the valuation still looks high relative to my DCF models, but it is leaving the ludicrous zone.
GE, on the other hand, is the only major company that I have modeled that is undervalued. In today’s bubbly market, everything I look at seems very expensive. GE under $20 is starting to look like a bargain. Maybe not a big enough bargain to pull the trigger, but definitely a big enough bargain to follow closely.