Buy Tesla Shares: Is it worth it? Forecasts And How To [2021]

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Published: January 11th, 2021 by Valentina

Buying Tesla shares? Founded by the histrionic and visionary Elon Musk, Tesla is one of the most discussed American companies in the past few years and … this is not a coincidence!

Its production of high-quality electric cars with high autonomy, together with the often overly optimistic and extravagant announcements of its “boss”, have allowed Tesla to have a global reputation.

In short, could we overlook the opportunity to invest in Tesla shares? 

Of course not!

Exactly for this reason, we have chosen to write this article in order to understand everything together with you:

  • Where to buy Tesla shares;
  • If it is convenient to buy Tesla shares;
  • How to buy Tesla shares in the UK
  • What is the price of Tesla shares.

Trading Tesla shares

Before proceeding further, however, we recommend opening a trading account with one of the best online brokers that you can find just with a click.

We have selected the best brokers – also for beginners, because they are very simple to use. Obviously they are reliable, safe and commission-free:

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    Not only that: these are brokers that will allow you to open a free demo account, with which you can experiment your ideas and strategies, without real risks for your capital.

    The operations carried out in the demo account, in fact, will consist of virtual money made available by the broker himself. In short, the ideal way to understand and learn!

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    Is it worth buying Tesla shares in 2020?

    We will try to understand immediately if it is convenient to buy Tesla shares in 2020.

    This is a very common question, since Tesla shares have experienced moments of positive and negative fluctuations in recent years, while still guaranteeing huge satisfactions for investors. But what will happen in the nearest future?

    Let’s try to understand it, step by step.

    Who is Tesla and what does it do

    The basis of our focus can only start from who Tesla is even if, probably, you already know what we are talking about.

    Founded in 2003 by Martin Eberhard and Marc Tarpenning, Tesla is today one of the main operators of electric cars. However, its fame began a few years later, when Elon Musk joined the company and took over the presidency in 2008.

    In the early stage,Tesla produced only very high-end electric sports cars. However, over the years, Musk has chosen to partially modify the strategy, expanding the range of models available, in order to embrace the wishes of a wider clientele.

    IPO Tesla

    Tesla entered the stock market in 2010, and its popularity immediately grew. Since then, in fact, the price of its shares has grown so much that many investors think they are facing an opportunity that can not be missed.

    Yet, in hindsight, Tesla’s market performance has been far from being equated with its economic and financial performance. In other words, much of Tesla’s growth in equity markets is driven by expectations rather than results.

    How much does Tesla sell? Economic and financial analysis of the company:

    Tesla experienced an important growth in turnover between 2009 and 2018. A development that can deceive about the sustainability of the corporate business which, however, has lent many weak sides in terms of margins and profitability.

    The problem of expenses and debts

    In other words, Tesla’s problem is not that it cannot sell, but that the company uses too much money to reach this result. And this explains why Tesla is a constantly losing company, with some flashes of positivity in recent times, but with a too irregular trend to justify the success of the stock prices.

    However, the last quarterly of 2019, bode well. In the last part of 2019, Elon Musk’s company reported results beyond expectations, capable of generating euphoria on the financial markets.

    In the fourth quarter of 2019, the company reported earnings per share of $ 2.14 versus the expected $ 1.72, and revenues of $ 7.38 billion versus the expected $ 7.02 billion.

    Regarding the announcements made by Musk, the entrepreneur said he expects a continuous growth in liquidity which, of course, will be suspended when new models will be launched or if it becomes necessary to increase the production rate.

    It is evident that practical references are not lacking. Like that of the Model Y, whose production has been started in a Californian plant. And that soon, moreover, will also be produced in the new gigafactory that Tesla has in mind to exploit in Brendeburg, Germany.

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    Tesla 2020 forecast

    It is therefore useful to focus the attention on the Tesla 2020 forecasts, with Musk declaring that the company’s sales should be around 500 thousand units without problems.

    This is not a new estimate, given that Musk had already anticipated it in a 2019 tweet. But it is also clear that this number could undergo changes, given the impacts of the coronavirus pandemic.

    The forecasts for the other corporate balance sheet items were also positive. In particular, on the revenue front, Musk stated that:

    • $ 436 million came from the corporate division that deals with storing solar energy;
    • $ 580 million came from services, including auto repairs and merchandise.

    Musk’s attention was particularly focused on the first of these two. For Tesla, it is possible that the increase in the turnover of solar batteries may grow by 50% in 2020.

    However, there is no news regarding the new guidelines on corporate accounts, which should be drawn up after the outbreak of the pandemic in China. In fact, this Asian country is one of the main markets for Tesla in terms of prospects and the company has opened a factory in Shanghai. It is clear that what happened in recent weeks can bring significant changes to the international development plans of this US company, which has no direct competitors to worry about, but it is – in some way- competing with companies like Ferrari, Daimler (Mercedes) and Porsche.

    How to buy Tesla shares in the UK

    Now that we have some more information about Tesla, let’s try to answer the question: How to buy Tesla shares in the UK?

    The answer is simple.

    You can:

    • Go to your bank. Here, it is required to open a security deposit account enabled to host shares of US companies, order the purchase of Tesla shares, and pay the related fees. Of course, you can also do everything from home, but – as we will see shortly – this is not the best way;
    • Open an account for free with one of the best online brokers, such as eToro, and trade Tesla shares as underlying assets of the operator’s CFDs.

    In our opinion, the second way is considerably cheaper.

    By doing so you can:

    • Avoid the costs of opening and managing bank relations, considering that eToro allows you to open your trading account here for free and use it as long as you want without any commission;
    • Avoid the typical commissions of any purchase and sale of shares. eToro does not charge any commission for opening and closing positions, because its remuneration is mainly linked to the spread, i.e. the differential between the two prices;
    • Negotiate in a simpler and more comfortable way, given that the trading platforms of the best known brokers are unrivaled in terms of usability;
    • Leverage trading, thus increasing the possibility of generating a profit for the trader, against a reduced capital asset (but pay attention to the proportional increase in the risk of losses!).

    The benefits certainly don’t end here. For example, we remind the possibility of getting a real training in the sector. Or, the possibility to access continuous assistance for the resolution of any problem.

    Trade with a demo account

    Evidently, given that trading always involves a more or less high financial risk, our suggestion is to start investing through the use of specific demonstration platforms.

    Trading with a demo account allows you to practice:

    • with the broker’s trading platform you have chosen;
    • with your strategy, testing it in real market conditions but without any risk of losing your capital.

    Once you feel confident enough to invest “real” money and put it at risk, you can certainly do the conversion of your account with a click and without expenses.

    Remember also that it is good practice to use the demo account not only in the early stages of online trading, but also later to test a new strategy.

    Tesla’s share price

    In the moment we are writing, Tesla’s share price is around $ 546. The trend of the last month is negative, considering that in the period we are considering the peak was 917.42 dollars, which represents the highest of the last 12 months.

    In order to consult the price of Tesla shares in real time, you can use your broker’s trading platform. Here, you can also manage the technical indicators in order to analyse the stock graph.

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    Conclusions

    That is, where to buy Tesla shares?

    We hope we provided some interesting evaluations of Tesla, its characteristics, and the possible investment opportunities.

    We have seen that Tesla is a mysterious object of desire, which has been able to celebrate a rather strong growth on the stock markets thanks to the continuous expectations generated.

    However, it is also true that very often Tesla has been the reason of very disappointing earning results and, above all, there is always an excessive debt on the company’s balance sheet, which represents the risk of making the company dependant on external lenders. Will Elon Musk always be able to convince the public of the goodness of his project, if the expected results should be coming slowly?

    Some expectations for the future

    Of course, we don’t know. But we believe that if Tesla manages to:

    • renew its range of models by expanding the customer base – without losing the value of your brand image;
    • be successful in some key markets, such as the Chinese one;

    It is probable that the future results of Elon Musk’s company will be more satisfactory than those we have seen in the past few years.

    Obviously, it is also necessary to deal with present developments and with one’s own strategy.

    As for the present, it is clear how the 2020 coronavirus pandemic could harm the corporate accounts by slowing down plans in key markets such as China.

    Better to practice with a demo account

    Regarding the second topic, we invite who is interested in investing in Tesla, to carry out a careful analysis of the strategy, in order to understand whether or not buying Tesla shares is actually compatible with own’s risk profile.

    Having said that, the thing to do is to enter the most operational phase.

    We therefore advise all those who are interested in buying Tesla shares, to do so by opening of a free trading account such as that of eToro (official website).

    We also invite readers to invest first using the “demo” account. In this way, it will be possible to see what it means to invest in this company, without putting real money at risk. The funds used will in fact be those of the broker. You can open a demo account on the official eToro website in few seconds!

    When was Tesla Motors founded?

    Its foundation dates back to 2003, the year of birth of the California-based company.

    Which is Tesla Motors’ turnover?

    In 2019, revenue was $ 24.57 billion.

    Where to buy Tesla shares without commissions?

    With the best trading platforms, you can buy Tesla shares without commissions, thanks to the free CFDs.

    What is Tesla’s Target Price?

    Tesla shares have a target price of $ 750 by 2020.

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