Good morning investors!

Every Thursday we release our latest “Deep Dive” — a high level, easy to follow stock analysis designed to give our IE+ members an EDGE when it comes to properly valuing a company. We do the heavy lifting so you can make more sound investing decisions.

Today’s deep dive target is Tesla — the world’s most valuable automaker in the world with a polarizing stock and a polarizing CEO.

In today’s article we will look at the company’s performance, recent results, and dive deeper into its valuation to determine whether the stock is a BUY, SELL, or HOLD as we begin 2024, based on our opinion alone.

Before we share our research, what are your thoughts on Tesla?

Alright, set your Tesla to full self driving and let’s dive in.

For previous CMG subscribers, you may remember that that I’ve done an analysis of Tesla twice before — once in a January 2022 newsletter where I made predictions for the year and another in June of 2023.

In the January 2022 deep dive, I said Tesla was extremely overvalued and I predicted the stock would crash 80% by the end of the year. I was wrong, the stock only fell 75%. 😉

Here’s a look at my prediction from that newsletter — I was bit more vocal in my opinions back then:

In the June 2023 deep dive, I gave Tesla some credit. I was quite impressed by its growth and the shoring up of its balance sheet but the share price had once again gotten ahead of its valuation. I called for the stock to at least drop to 100, which would have represented a -65% decline in share price.

Here’s a look at my prediction from that newsletter:

As of the close on 4/17, Tesla’s share price is 158, which represents a decline of -43% from that last Deep Dive.

Tesla has issued three earnings reports since then, with a fourth on the way next week. So the question now is — does today’s valuation make sense and is the stock actually a buy here? Let’s find out.