When Should You Buy Tesla Inc (NASDAQ:TSLA)?

Let’s talk about the popular Tesla Inc (NASDAQ:TSLA). The company’s shares saw a decent share price growth in the teens level on the NasdaqGS over the last few months. As a large-cap stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. But what if there is still an opportunity to buy? Today I will analyse the most recent data on Tesla’s outlook and valuation to see if the opportunity still exists. View our latest analysis for Tesla

What’s the opportunity in Tesla?

The stock seems fairly valued at the moment according to my valuation model. It’s trading around 6% above my intrinsic value, which means if you buy Tesla today, you’d be paying a relatively reasonable price for it. And if you believe the company’s true value is $315.34, there’s only an insignificant downside when the price falls to its real value. Furthermore, it seems like Tesla’s share price is quite stable, which means there may be less chances to buy low in the future now that it’s fairly valued. This is because the stock is less volatile than the wider market given its low beta.

What kind of growth will Tesla generate?

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company’s future expectations. With profit expected to grow by 77.23% over the next couple of years, the future seems bright for Tesla. It looks like higher cash flows is on the cards for the stock, which should feed into a higher share valuation.

What this means for you:

Are you a shareholder? It seems like the market has already priced in Tesla’s positive outlook, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the track record of its management team. Have these factors changed since the last time you looked at the stock? Will you have enough conviction to buy should the price fluctuates below the true value?

Are you a potential investor? If you’ve been keeping tabs on Tesla, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the optimistic prospect is encouraging for the company, which means it’s worth diving deeper into other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.

Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Tesla. You can find everything you need to know about Tesla in the latest infographic research report. If you are no longer interested in Tesla, you can use our free platform to see my list of over 50 other stocks with a high growth potential.

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