Give me a stock tip.

Fueled by Caffeine said:

There is someting very wrong with the stock market right now.. it's not reflecting relaity.. not that it has to 100% but the fundamentals seem off

 

Ya' think   100+ year average P/E ratio for the S&P 500 is 15.5 and it's currently standing a little north of 25.  So, reality would be a 40% contraction from current valuations but the fed is overriding the return to normalcy and the Wall Street consensus is for the S&P 500 to close the year at 3,600 (~6% higher than current levels).  I think the make or break is how soon and how efficacious the vaccine is (if it's not widely being deployed by early spring 2021 or has below ~70% effectiveness we're hosed).

It's not just the valuations that are screwed up.  BP reported earnings a while back.  Disastrous quarter, they lost a ton of money and cut their sacred dividend in half.  Estimate was $-.99, they lost $1.98.  The stock popped 8% the next day.  There's a whole lot of examples of irrational pricing out there.

So I'm sitting here, 90% in cash, watching the market go skywards.  Ouch.  I hate it when reality disagrees with me. 

Fueled by Caffeine said:

There is someting very wrong with the stock market right now.. it's not reflecting relaity.. not that it has to 100% but the fundamentals seem off

 

 Welcome to the "K" shaped recovery.

Same thing happening in the UK too

SVreX (Forum Supporter) said:

RX Reven' said:

Robbie (Forum Supporter) said:

Whelp, if you'd picked TSLA on 11/29/19 when you originally posted this your $500 would now be worth about $1700. 

If MTN had jumped in like he said on 4/3/20 with $500, He'd have $1169. 

I missed the TSLA opportunity but the $3,000 in Amazon stock I bought 27ish years ago closed today at $92,118 which is safely more than my total debt (mortgage, car loan, and wife's credit card...my credit card has $39.60 on it it can be ignored).  My Amazon in my Roth IRA so no tax will be owed if I wait until I'm 59.5 (3.5 years away) or get E36 M3 canned from my job.

2 weeks after you "missed" the TSLA opportunity, I took it.

I bought TSLA on 7/14 for $1,499.  Terrible price.  Today it is $1836.  That's a 22% gain in one month.

Scratch that.

TSLA split this morning.  5:1.

It's not up 22% since 7/14.  It's up 63%.

Crazy.

Apple split this morning as well.

In reply to ShawnG :

Wow.  I missed that.  I rode their previous 7:1 split to over 1000% increase.  Add today's 4:1 split...

That means my Apple stock has split 28:1.

so if you were to buy TSLA today after the split what's the chance that it just keeps going up?

mostly curious because i just dumped the entirety of my skyline fund into it to see if we can't fast track things

It has to burst one of these days,  I missed my shot at getting it back when it was $180 a share and I backed down.  I did get some Apple though and it's doing quite well

In reply to Patrick (Forum Supporter) :

Real investment advisors say there is no difference between 10 shares @ $10 and 1 share at $100. 
 

However, I like splits. It seems when people are used to paying $2000 per share and they see it drop to $400 per share that they just run the price back up. 
 

Definitely NOT scientific. 

In reply to Patrick (Forum Supporter) :

Even with the overvalued price tag, I'm still expecting it to rise by more than 100% more. 
 

But don't listen to me. Listen to the people who are saying it is overvalued and will collapse. 
 

I am ONLY using play money that I can afford to lose. 

yeah I'd be really afraid of putting any large amount of money into TSLA right now. 

Not that I don't think they are doing good things as a company. I think they are. 

But, (split adjusted) last year on 9/2 they were $45.49. Today (now) they are $479ish. Is Tesla 10x the company it was 1 year ago? Unlikely. 

If the price of anything else you bought in 2019 was 10x higher today you would look at the seller like they were crazy, and you would only buy if you REALLY had to. But somehow, with stocks, when the price goes up, so also does the demand...

In reply to Robbie (Forum Supporter) :

You are correct. I completely agree that is the way it should work. 
 

But the world is topsy turvy, and doesn't work the way it should anymore. 

SVreX (Forum Supporter) said:

In reply to Patrick (Forum Supporter) :

Even with the overvalued price tag, I'm still expecting it to rise by more than 100% more. 
 

But don't listen to me. Listen to the people who are saying it is overvalued and will collapse. 
 

I am ONLY using play money that I can afford to lose. 

TSLA doesn't make sense, and never really has. I don't think that you know any less than the people who are saying it is overvalued and collapse. FWIW, I think it is overvalued, by a considerable amount. I don't think it will collapse. Which makes me worried about the market in general.

TSLA's battery development will probably make them more valuable than their car production. 

In reply to AngryCorvair (Forum Supporter) :

That's the thing. 

I think people are looking at Tesla as a car company and not a tech company.

mtn (Forum Supporter) said:

SVreX (Forum Supporter) said:

In reply to Patrick (Forum Supporter) :

Even with the overvalued price tag, I'm still expecting it to rise by more than 100% more. 
 

But don't listen to me. Listen to the people who are saying it is overvalued and will collapse. 
 

I am ONLY using play money that I can afford to lose. 

TSLA doesn't make sense, and never really has. I don't think that you know any less than the people who are saying it is overvalued and collapse. FWIW, I think it is overvalued, by a considerable amount. I don't think it will collapse. Which makes me worried about the market in general.

"the market" is driven by the decision-making of people.  think of the average person.  half the population is dumber than that person.  even within brokers, analysts, etc, people who should know better, each of those groups has an average person, and half of the group is dumber than that.  i don't try to explain anyone's decisions but my own, and even then it's difficult sometimes.  buy into whatever you want at whatever price you're willing to pay.  set a stop loss price at which you sell, to (hopefully) avoid losing your ass when the bubble bursts.

ShawnG said:

In reply to AngryCorvair (Forum Supporter) :

That's the thing. 

I think people are looking at Tesla as a car company and not a tech company.

then i guess to some extent those people are just getting lucky.  the battery E36 M3 is where it's at, long-term.

One of Warren Buffett's tricks is to consider each stock purchase like you are buying the entire company for the entire market cap (total # of shares * price). Then you can easily see what you expect to get as a return on your investment. 

You still need to figure out what you think the company will return to it's owner (profit/dividends, share price change, value of tech or IP, assets/debts, etc) on your timetable - and that is not in any stretch an easy or exact calculation, but at least you can put the whole thing into perspective. 

Also, if you decided NOT to buy Tesla shares anytime in the last 2ish years, why did you decide that? What has changed about the company now? If you did the same calculation above both last year and today, you had better have found some very compelling evidence that the inherent value of the Tesla corporation has increased more than 10x if you answered no last year and yes this year. 

There was a time when companies were evaluated by things like net worth, profits, and market share. 
 

Then along come companies like Netflix, Zoom, FaceBook, and TSLA. Suddenly companies are valued by potential, enthusiasm, and reach. 
 

Totally different. 

Robbie (Forum Supporter) said:

Also, if you decided NOT to buy Tesla shares anytime in the last 2ish years, why did you decide that? What has changed about the company now? If you did the same calculation above both last year and today, you had better have found some very compelling evidence that the inherent value of the Tesla corporation has increased more than 10x if you answered no last year and yes this year. 

agree 100%.  last year my reason was "because that guy is a kook."  

Thanks to AirBnB, real estate is no longer valued by appraisals of sold properties and appreciation,  but by cash flow potential. 

SVreX (Forum Supporter) said:

Thanks to AirBnB, some real estate is no longer valued by appraisals of sold properties and appreciation,  but by cash flow potential. 

FTFY

In reply to AngryCorvair (Forum Supporter) :

I said it was because his cars are crap quality and he can't manufacture paper bags.. 

Fueled by Caffeine said:

In reply to AngryCorvair (Forum Supporter) :

I said it was because his cars are crap quality and he can't manufacture paper bags.. 

I agree. 
 

And I can name 100 developers who build crap houses and have made millions selling their crap to consumers who want to buy it. 
 

Meanwhile, I have made very little money building exceptionally well built homes that consumers aren't interested in buying. 
 

Who cares if it's crap?

SVreX (Forum Supporter) said:

There was a time when companies were evaluated by things like net worth, profits, and market share. 
 

Then along come companies like Netflix, Zoom, FaceBook, and TSLA. Suddenly companies are valued by potential, enthusiasm, and reach. 
 

Totally different. 

How do you think the 'dot com boom' companies were valued in 1999?

Then how were they valued in 2001?