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Motors is on -- -- for the past month -- Tesla has been skyrocketing up.
Straight towards 100 dollars a share after languishing.
In the forties or below for several years it's also funny no shortage -- -- -- bonds.
Even though they offer only one point 5% interest so why is Tesla doing so well.
While most other electric car companies like this current code I've been going bust is Wall Street's vision a little too rosy right now a debate.
On the markets infatuation with Tesla between -- fix the car coach.
At AOL auto blogger and Colin -- senior research analyst for north -- capital markets folks could deceive both Lauren.
First to -- does Tesla deserved.
All the praise and particularly the high price of the stock right now.
Well I think it produced a really cool car in a fury and oh I -- electronics and the Nvidia chips that are -- there are very very.
-- and really cutting -- -- first for consumers if you want that and you want to make a political statement.
Or personal statement.
It's a great car but as far as the stock that's a whole other animal and I think that it's inflated and we put them up on a pedestal.
When their total sales for this year -- only been 4750.
And you look at the other manufactures a creaky knees or other cars in that category.
And it's -- if you compare it's really not that big of a deal but -- over inflated it and given it a lot of play.
Right now the Colin we're all happy that they had a big part of they had a profit of eleven million dollars last quarter hour was that a big profit because it was eleven million dollars.
And -- 68 million dollars of the money coming in as you know.
Carbon credits from California so you take out the 68 million.
In the carbon credits and might my question to you is.
-- Tesla is business models survive without government input whether it's the carbon credits or or the money that they get back to consumer.
Absolutely that is what I do want to fact check real quick before -- -- of the company actually sold nearly 5000 cars.
In the first quarter it was four 4750.
You know as a -- and ended up delivering 4900.
For the first quarter so almost 5000 cars.
Under the credits absolutely we're in the very very early stages first -- -- cost reduction on this vehicle.
And so to see them you know benefitting from -- credits is is something that is always a concern for an analyst.
You -- a sustainable business model is but as we move forward into Harbaugh and the production.
When you see significant cost reduction just from the suppliers -- on what -- meals -- -- on the technology side are right that at all costs on.
Lauren what do you say about that could its business model survive.
The pullback of of government assistance.
Well that the nice thing is that they're actually selling some stock in order to -- out this government loans -- given credit for that gives them a little bit more freedom.
But what I do think is that the average consumer doesn't can't afford 70000 dollars for -- car and they're expecting 21000.
Vehicles to be sold this year.
That may be out very aggressive at the nation when you look at the sales of ED cards are crossed and every single manufacturer is taking a lots.
So far they're making a profit.
But that's -- didn't get a really look at these numbers and take a look at their financials and I'm not a financial analyst I'm not -- -- Collins the expert on that.
But I will tell you I personally wouldn't invest in the stock I think it's artificially inflated its almost like a -- -- everyone wants to get on board.
And then eventually you know that -- the stock's gonna drop from love a lot because I don't think that people can afford 70000 dollars on average sale of a car is about 25000.
-- up pet rock is.
-- what Cecil is right now.
Not by any stretch you know that the market that they're dressing as a two and a half million car market a year.
Selling Tony 1000 cars -- -- -- a fraction a percent of the stressful market we're looking at the premium vehicles.
I don't -- to copiers the other electric vehicles were really looking at Mercedes BMW.
Audi does those types of vehicles you know over 45% -- these vehicles -- least isn't cash out of pocket -- -- introduced a leasing products here in the last month and a half do you think that's gonna enable significant amount of sales.
There are seeing none with at least another two and half quarters of backlog and orders in hand at this point and you know I think we're just scratching the surface here in terms of total demand.
But -- -- in the market so far is that once these cars who delivered it it causes a stir in the neighborhood you know pre school parking lots.
The cars are great they perform extremely well they're built for luxury buyers as a third -- on buses and commuter vehicle this is her this is an.
Retrofit all -- this is a commuter vehicle it's a toy.
-- well it usually as it is but on the other hand with a with a price rate is 62087000.
-- for everybody on the other hand Warren.
I gotta put -- the consumer reports says they have never ever in the history consumer reports -- a better constructed car.
Unlike unlike the other car companies -- -- -- that went bust or in the process of going bust.
This is a premium car that gets the highest rating also unlike those other car companies.
Elon Musk has put his own money into this I guess.
And they are gonna be paying off the government -- they did get government loans in the beginning.
But this is a guy who knows how to create a company that succeeds -- answered votes.
Well I think the first stop there is no infrastructure for dealerships right now so that -- definitely gonna -- total sales.
Yes they're available and sat on my back New York in certain cities.
But in order to make those numbers that he's looking for that 21000 -- you -- at a dealership infrastructure and right now they're trying to sell direct to consumers.
That is definitely going to be an issue because you got service facilities to keep in mind.
Remember what these cars they're getting mileage -- gonna still need to have brake pads and wiper -- and things that wearing terror.
And those that's where you're gonna need to have -- dealership infrastructure and no one has a Tesla dealership and they're only selling them.
Basically at malls and -- -- and so forth is going to be an issue with and a lot of states don't want.
Tough -- to sell vehicles direct to consumers because of franchising -- and franchising groups that are saying.
-- -- dealer group and we want to double the consumer directly and so that's going to be an issue.
We're not gonna come do any kind of -- continued to but -- I just wondered how high you think this stock goes it's now trading at about ninety -- some people say you go up to 200 what say you.
You know we've got a 95 dollar price target now we're -- back on 2016 times.
We have it's a twelve month price target you know is really approaching that right here you know if they.
Execute on this business -- over the next five to seven years this could be -- 16870.
Dollars -- you -- well anywhere it's a little bit early to say that a strong and straight there that got a lot of support from -- you ain't seen nothing yet folks Colin rush Lauren -- great to see you both thanks for company again let's see you David I want one that's all I have to thank I had garage first.
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