all right so I needed to do a completely separate video about Tesla 10 Xing or not that's the reason why it wasn't in my last video at all because honestly there's just a lot of nuance to it there's so much meat to get into that it just would have tripled the length of that video so I decided to make its own dedicated video here and you're right guys I should have mentioned that somewhere in my other video but I failed to do so so I apologize it's my fault here but we're here today and you guys are going to get the truth without the hype about this exact question is there a 10x in Tesla or not which of course means some of you guys really appreciate that approach in all my videos and some of you guys are going to be a little bit mad at me and hey that's okay it's been part of my YouTube Journey this entire time so I expect nothing less I'm completely used to it I got blasted whenever Tesla was at $400 and I said it was way overvalued when everybody else was out there saying it's going to 700 or a th000 the real truth without the hype was it was sitting at a PE over a thousand so that baby was coming down whether we liked it or not had nothing to do with whether I was bullish or bearish on Tesla or anything else like that obviously I'm bullish on Tesla but that was just a ridiculous price to pay and after it had that huge runup I got blasted for saying hey it could trade down for years and sure enough here we are it has traded down for a few years now and that wasn't me being smarter than everybody else or having some insight or you know any sort of inside information or anything else like that I just simply applied 20 plus years of investing knowledge in this situation and understanding exactly how Wall Street works exactly how stocks work over the long run now in the short run I have no idea what's going to happen I have no clue neither does Warren Buffett neither does really any other investor out there they just don't know going to happen in the short term it's really impossible to make those sorts of predictions however when you've been investing as long as I have you understand that valuation matters in the end and that makes it easy to see scenarios where a stock gets significantly overvalued you know obviously at a PE of a thousand it's way overvalued at that stage and then more importantly that means it's going to trade down or flat for some time as that valuation kind of starts to come back to fair value longterm certain truths just hold true in the stock market and that's all I did was apply those truths to that situation now if I made this video back in Jan January when the shares were right around 100 bucks or so we were gobbling up shares like crazy I know I was I know a lot of you guys were I know my group members were just gobbling up like crazy then yeah back then I can absolutely say a 10x is it would be a 10x stock at that stage and don't forget to sale ends tomorrow to join my group if you want to see buys like that in real time and just a whole bunch else we don't have time to get into it today just check out the pin comment and take advantage before it ends tomorrow so at $100 per share that makes absolute sense to me that we could see a th000 in the future but now we are sitting at closer to $300 per share meaning I need almost three times the amount of run in the stock price in order to get that same exact 10x so that to me is a much more murky picture than it was whenever it was at 100 I'm not saying it's impossible I'm just saying it's a much taller order than it was just a few months ago so here the five reasons why 10x from here is going to be very difficult for Tesla and then we will discuss the truth with Tesla if it doesn't make another 10x run again and either way regardless of whether you agree or disagree with what I'm about to say you need to understand that truth truth in order to really understand what you have with Tesla stock so the first reason it's going to be difficult to hit a 10x is because multiples always compress as companies mature look I look at a lot of those videos same way you guys do or Tesla 2030 or Tesla 2035 or Tesla 2040 or whatever's out there and the big flaw that I see with each one of those videos that I watch and actually there's some great information in there some great uh background a lot of work that's gone in there but the biggest flaw that I see is thinking that as Tesla marches its way up from you know basically being close to a trillion dollar company right now to the largest company in the world potentially is that somehow Wall Street is going to pay this crazy multiple for Tesla stock when that's just not the way it works as you kind of move from you know midcap to large cap and into that rarified erir of the five six seven stocks that are Mega cap type territory those multiples get pressed get compressed all the way through that journey and it's happened with every single stock you always get a much higher multiple when you're early in your growth stage versus later in your growth stage now I don't mean in terms of your ability to grow Revenue later on or anything else like that I mean in regards to going from you know the the number 300 stock in the world in terms of market cap to the number one market cap that's the growth that I'm talking about if you can show it to me I would love to see it but I've never seen the largest market cap stock in the world also traded at a crazy 120 PE or an 80P or something like that it just doesn't happen and if it does it falls down very very quickly shortly after that we're istically as they move up the chart up the ladder up the standings per se possibly into that number one category later on the multiple is going to get compressed from here as you kind of model things out looking for that 10x using the same multiple Teslas getting today to me is not a realistic way to look at it regardless of whether they get into software whether they get into all these other avenues that they have coming the point being that's not how Wall Street thinks that's not how large investors think and guess what by the way when you start getting up into those higher higher levels you involve more and more larger institutional type investors big money big big Pension funds things of that nature and you've got to understand exactly how they think which leads me perfectly into reason number two that it's going to be hard to 10x and that would be market cap gets increasingly harder to gain it's very easy to go from a you know 100 million to a$2 billion market cap it's still relatively easy to go from two billion to 10 billion but it's infinitely harder to go from one trillion to 10 trillion or five trillion or even just hit your second two trillion or 3 trillion it gets infinitely harder and that's simply because the amount of capital to come into it whenever it's at you know let's just say $100 million market cap in order to double that up is relatively easy at that lower number there's not a lot of money has to flow into that stock in order to push it up to that next level but you get up over a trillion it takes a lot of money to push it to two trillion and then of course two trillion to four trillion takes a lot more it just gets infinitely harder so getting to that first trillion is much easier than getting to that second trillion much less 10 trillion or in this case you know we need right you know just over eight trillion to get there that is a lot of money that has to flow into Tesla stock and be willing to stay into Tesla stock long term and that's really really really hard to do now I'm not saying it's impossible I'm not saying it can't happen but when Apple kind of had its epic run up over a trillion and then almost a three trillion man to think it could go from three trillion to Six Trillion which still isn't a 10x that's a much much much harder proposition than it was just making that initial run that it had up can they get there it's possible that they can and same thing with Tesla but man it takes so much more and it is so much harder and people are viewing this in a spreadsheet lens and that's the reason why sometimes spreadsheets are flawed and why models don't work all the time and a lot of those other things like that that we obviously saw last year none of the models freaking work they all broke because you're you can't account for the fact that more money has to Capital us to run in it looks nice and linear on a spreadsheet hey Tesla does this well people bought it at this price so they're going to buy it at this price it's not how it works because you got more money that comes in and the further out you go in terms of needing larger and larger chunks of money the more and more conservative that big money gets they're not risky they're not ping into Tesla stock when it was 100 million dollar market cap they just weren't even touching stocks like that however they'll happily pile the money into Apple who's nice mature steady and already there and you see how hard it is to move that from A3 trillion market cap to a $5 trillion do market cap much less an8 trillion do market cap like Tesla's going to need oh yeah and by the way you generally to get that money to come in you need polish management which you know as much as I love Elon and I think he's the driver behind all this he's not polished the way Tim Cook is those are all things that you have to factor in that a spreadsheet just can't see it can't figure out and it can't know and you there's no way to evaluate that but they're all important in terms of moving that thing up the market cap scale and the third reason why it's going to be hard for Tesla to 10x is that everybody is assuming FSD a is going to be allowed anytime soon and B that it won't be heavily regulated which both of those I think are false I think Tesla's FSD is eventually going to be allowed I agree completely but it is going to have to jump through so many regulatory and you know at the state local and federal level and it's just going to take a lot of time a lot more time than what people think and I still in terms of the thesis behind it I look at FSD now and I'm like okay I have the money to buy a Tesla if I was going to buy a Tesla I'm sure as heck not paying the price that Tesla's charging for that right now in regards to FSD it's not worth it to me at all to spend an extra $10,000 on a vehicle for FSD it's just not and I think most people are going to Bonk at that think about your car whatever car you bought last if they're tacking an additional $10,000 on the price of that vehicle for something that is years away from possibly being legal much less actually used a lot of people even though they may say I would buy it I would buy it I think the vast majority of folks buying new vehicles are not adding that $10,000 add-on maybe I'm wrong and it could be a Smash Hit I I would not be surprised by that at all but I have another fear with FSD that nobody wants to talk about but it's absolutely the reality and that is if FSD kind of becomes more of a a safety thing kind of like think back the airbags back in the day Tesla's going to be forced to share that with everyone for free they're not going to get compensated for that it's going to be hey we I could see a scenario to where the government says hey we're going to allow FSD but you have to share the tech and everything behind it all the data that Tesla's been collecting to put them miles ahead of the competition which is 100% true they're going to force them to say hey turn all that over so that way we can legalize it so that way everybody can do this safely obviously I hope they're able to strike deals ahead of time and they're able to kind of get ahead of this a little little bit and start drawing in revenue from everybody else which would be great but to put that outside of the realm of possibility especially with the political environment here in the US I think that's very very naive at best so a lot of times when I think about FSD I'm just not sure it's the massive opportunity that everybody puts it out there as I agree it's a large opportunity but I'm not sure I buy fully into the fact that it's going to be this massive opportunity that's just going to bring trillions of dollars into the pockets of Tesla there's just a lot of political Regulatory and more importantly customer accepting that I'm not sure nearly as much of a shoe in as a lot of the YouTubers and a lot of the videos out there make you think it's just a complete shoe in it's just guaranteed you've already seen the timelines for this get completely blown out of the water it's going to be years into the future despite the fact that was coming next year for I don't know six seven eight years now so don't be surprised if we see some of these things hindered up now obviously if it doesn't definitely helps our case in terms of getting that 10x out of Tesla but if any of those stickler points regulation at the state local or federal level and then of course the customer themselves Bing at the price point with it if any of those things kind of go wrong it really puts a hole in that 10x thesis the fourth reason why it's going to be hard to 10x from here because it assumes all the other business lines are also successful as well I've seen very few models where people were not actually including all the different avenues that Tesla's looking into being successful almost all of them have some varying degree of success with all those different deals and that's just not how it's going to work in practicality no company has all hits and no misses they just don't Apple doesn't Microsoft doesn't nobody has that sort of track record so to think Tesla's going to have that now is not true and they've had failures in the past as well so that's again another assumption that's kind of works in those models to create that 10x in the future however whenever I kind of back up and I kind of take a bigger picture look here I kind of see that hey no company has ever had 100% success rate with their products so why am I all of a sudden applying that to a thesis with Tesla it's just not realistic now which ones are going to work which ones aren't nobody knows who knows he likes to aim big and part of aiming big means you're going to have some massive hits and you're also going to have some massive misses so for me you've got to factor in some misses into this that's going to make it harder to 10x and the fifth reason why it's going to be hard for Tesla to 10x from here is because a company having multiple 10xs in the first place is very rare and guess what guys Tesla has already had multiple 10xs already now that doesn't mean another one's impossible or anything else like that but unless you're a stock from back in the 80s or 70s or something like that with all that timeline behind you it becomes incredibly hard to get a 10x anytime soon for another time time after you've already had multiple in the first place you can go back and look through the history of the stock market guys and I challenge you to find somebody with you know five 10 X's during that time it's just very very very hard very very very rare and that doesn't mean Tesla can't be that rare company but they got to get themselves there first and it's just going to be a difficult world to Ho from here especially given where they started from and where they're at right now that is an incredible feat to say the least now after all you guys are done blasting me down in the comments and everything else let's all come back here let's talk about what happened and what the truth is behind Tesla if we don't get another 10x I'm not saying we will or we won't I'm just saying it's going to be extremely hard from here right now so if we don't get that 10x here is the simple truth about Tesla it is still a great investment for the future guys I don't need Tesla to 10x in order to make me a lot of money in the future because there's no point in banking on 100x pulling me out of whatever situation I'm in or creating my wealth for me because I know that's not reality in terms of wealth building and in terms of actual return from my investment if Tesla just 5x's over the next 10 years that's an incredible investment an incredible return on investment and there's not going to be too many Investments that beat Tesla during that time frame there's going to be very very few just a handful that may beat Tesla during that time frame so I don't need a 10x I don't need half of a 10x in order for it to be a great investment for me so that right there is the truth you have to understand is it doesn't matter whether or not Tesla 10x is from here or not it can still be a great investment with or without a 10x it does of course it's better if you get the 10x absolutely but if you don't get it it's okay it doesn't matter one way or another it's still a great investment long term and if you aren't too mad at me and you want to see all my buy and sell alerts at real time see my watch list complete with price targets you want to take five courses for free you want to use our stock analyzer tool completely for free you want to be a part of the best 67 and8 figure Discord out there you want to slide into my DMs jump on our live q&as you want get you want access to three to five videos every week that just get released to our members there make sure you take advantage of the sale that's going on right now for my group before that expires because the price goes up and just see if it's right for you at least check out the pin comment and click this video here if you want to see exactly what I'm buying in this market and click here to see my exact plan for this Market thanks for watching and we'll see you in the next [Music] one
