Tesla: Car or Tech Company?
NEW YORK (TheStreet) -- The question of what Tesla
And the question is understandable: its valuation makes it look like a tech company. But it makes cars. Really nice cars. Really safe, fast cars. Really safe cars that run on powerful batteries with unquestionably the best center consoles anywhere. But in the end, they're cars.
Does that make Tesla a tech company?
Of course not. Tesla is a car company that is priced like a tech company. And not just any tech company, but a really good tech company. Just as Amazon
What all of these companies have in common is they have used technology to disrupt. Worth a premium? Sure, but does it deserve a technology premium?
Again -- of course not. But that's an argument that is hard to win in a momentum-driven market. Historically, Wall Street is famous for packaging one thing and selling it as another. Investors love to buy into those stories. They're like Beanie Babies for grownups.
Reality: None of this really matters. Tesla's valuation is in the ether, everybody knows it and it will continue to confound until the day something doesn't meet expectations, at which point its shares won't be able to hold a charge. Until then, even if it really is a car company, it will be lumped in with tech stocks. It's just the way it is.
--Written by Herb Greenberg.
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