Why I Own And Buy Tesla (TSLA) Stock For The Long Term.
Yet Another Bull Case.
I thought I’d include a quick section about why I started buying Tesla stock in 2015 and why I continue to today.
My VERY Basic Investment Approach: In the world of MEME stocks it’s easy to forget the basic purpose of investing. Companies need your investment to bring new ideas to market. The stock market provides easy access to capital for companies delivering good ideas. Successful execution of good idea delivery is measured in happy customers and revenue.
I invest in companies that are building the world I want to live in. In that world, boring things get automated, creativity wins and experiences are delightful. I measure delight by how long it takes a first time customer to smile. Example, the first time you feel a Tesla go from 0–60 you smile, 100% of the time! It’s truly delightful, customer and revenue growth prove it.
I avoid companies that only innovate on business model or prioritize stock piling cash over innovation. Both are attributes of legacy businesses with less growth potential. Sitting on a mountain of cash is a sign they’re out of good ideas, plus these businesses are boring to follow.
Tesla Bull Case: We know Tesla’s “why” is to accelerate the world’s transition to sustainable energy. Their first principles approach to design and vertically integrated manufacturing and sales are well publicized. This is “how” they become the world’s largest company by accelerating the transition.
Many people miss the “what” they may make in the future to accelerate the transition. Each product is more ambitious than the last, so people routinely forget that they successfully delivered the last “crazy” thing. Their track record of delivering disruption at scale is amazing, albeit often late. I now assume if they get a product into beta, they will figure out how to scale it and make it delightful.
In the next decade Tesla could be beta testing a complete home energy solution. This would include roof, power storage, HVAC and mobile connection (called a wall charger today). Customers will make lots of energy at home, storing it in home batteries and cars. The cars can become mobile power sources that are loaned out autonomously.
Tesla software could allow owners to provide energy and rides for a fee. Distributed ownership means more people can profit from optimizing the power grid and relieving traffic congestion. Semi trucks and mega packs will help businesses and utilities participate at larger scale. This ecosystem will become cheaper over time, to a point where clean power and mobility become viewed as a basic human right. Access will be on the scale of the mobile phone.
Life will be quieter, cheaper, cleaner and more delightful.
Growth Metrics: On top of the above optimism about a bright future, Tesla’s metrics make it clear. They have built a money machine to fund doing right by humanity. No matter how you quantify financial success, they check the box. What critics routinely get wrong is the power of this momentum.
Tesla is building the world I want to live in, TSLA stock is how I buy a part of that future today.
Compulsory disclaimer “this is not financial advice”.
