Yet, their stock is valued like one of those startups.
Can you expand on that? In theory, TSLA could become the next Toyota or GM. I guess that technically fits under 'somewhat'.
Market Cap Revenue Price/Sales
Toyota $201B $266B 0.76
VLKAY 91B 269B 0.34
Tesla 61B 12B 4.93
GM 60B 144B 0.41
Honda 56B 139B 0.40
Ford 47B 160B 0.30
Are you seroius? Someone says the market cap of Tesla is "somewhat" bounded, and you ask how? Is it totally unbounded? Is what they are doing unprecedented beyond comparison?
Do you think the market cap of Tesla is infinity? It's already multiples of companies that produce a magnitude more cars and infinite more profit. Not good enough for you? What is it that you think Tesla does so well that justifies an unlimited market cap?
This is insane. Wish HackerNews existed during the DotCom bubble. It was bad enough being accused of sexism during the Theranos bubble.
GM currently makes more cars in a week, then TSLA does in a year. And it does so on positive margins.
It's certainly possible for TSLA to get to that point, but it is anything but a sure thing. Why anyone would be surprised that it is one of the most shorted stocks in the world is beyond me. If they fail to grow to GM's size, the shorts will be justified.
To put it in tech terms, it's valuing Mozilla > Apple, because Mozilla sold a million Firefox OS phones. Except that in this imaginary world, Mozilla doesn't even ship a web browser, and keeps having to ask its landlord for an extension on the rent payment due date. Obviously, Firefox OS will sweep the world by storm! Who doesn't like freedom? Surely, the users will switch en masse, and leave the old dinosaurs like Apple and Google broke.
In 2008, any 'we will change the world because everything social' startup.
in 2016, any 'we will change the world because everything crypto' startup.
All you need is a slide deck about how the <Whatever> market has been growing X% YoY and is worth $XYZ billion dollars, and how your <Website/App/Coin> will change everything. Hell, these days, you don't even need a slide deck, just a whitepaper.
As long as you don't actually have any revenue, you can keep people hopeful. Maybe you will grow into Amazon. Most of the time, you will grow into pets.com.
Why? Because it's an off the charts volatile basket case.
You can't talk about shorts without talking about hedging, both stocks and (convertible) bonds. This is a complicated financial play. Unfortunately, as happens, retail chumps will get roasted either way.