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Tesla (TSLA) announces its earnings for Q4 today and the stock is already pushing higher. This article explains some simple reasons why I own the stock and why I am going to continue to buy it. You might want to buy it too after looking at my reasoning.
Tesla is at an all-time high in terms of its valuation. Right now its market capitalization is about $837 billion. Seeking Alpha says that its price-to-earnings (P/E) ratio is very high at 345 times earnings. Why would anyone buy a stock with this sky-high P/E?
Looking To the Future
Well, for one, things are not as they seem. It really makes no sense to look at the past earnings with this fast-growing company.
This is the main point that a popular YouTube analyst on Tesla makes. His name is Rob Maurer and he has a channel called Tesla Daily. For example, his video today about the company’s upcoming earnings shows how the company is extremely profitable.
He goes through all the numbers. He says Tesla’s historical and even its forward P/E ratios are irrelevant. He shows how the earnings are growing so fast. This is due to…
