Why I Bot $TSLA
Tesla has a young founder, huge target addressable market (TAM), emerging optionality, profitable financials, growing at 15%+ per year, benefits from network effects and is in the S&P 500. When you have a business that meets all of these, how can you not buy?
Apologies, I lied to you like your parents lied about Santa.
Lying to your kids about Santa is lying to your kids.
— fat baby funds (@fatbabyfunds) December 21, 2020
Tell me why I’m wrong!
I didn’t buy $TSLA. I own $FB. All of those descriptions are more true for $FB than $TSLA.
Young Founder – Musk is 49. Zuck is 36. $FB wins
TAM – I honestly can’t state the TAM for either, but I can safely say the TAM for $FB is higher (Social media, payments, marketplace, online dating, messaging, VR, AR, e-commerce, etc…). $FB wins.
Profitable – Tesla has to play games to be profitable. $FB has 37% operating margins. Oh, yeah… $FB also has 3x more sales. $FB wins.
Growth – $FB is growing 19% CAGR 1Y TTM vs $TSLA at 15%. $FB wins.
Network Effects – Social networks benefit so much more from network effects. $FB wins.
Data – $FB is a company driven by collecting your data. $TSLA has some data, but nowhere close. $FB wins.
S&P 500 – Both are in the S&P 500 at this point. Not really a catalyst going forward. $FB wins.
VALUATION – BONUS – See profitable. 3x sales + growing faster + 10x more profitable + larger TAM. $FB wins.
Once again, I apologize for lying. I wanted to emphasize why investing is nuanced. Maybe I am missing the forest for the trees. Maybe I am wrong about $FB going forward, but then sub in $AMZN. I am trying to bend the constructs of our minds.
P.S please mess with me back. Together our minds grow stronger.
