Why I’M All In On TESLA In 2022
If you invested a hundred dollars in Tesla shares in September, 2019, you could have made $2,100. That’s a lot of profit for doing absolutely nothing.
So today let’s discuss the three biggest reasons why I believe Tesla stock is set to really explode in 2022, starting with reason three and working our way up to number one.
I’ll also be revealing what price I bought back in there and after selling all my shares for a huge profit a couple of months ago. So let’s make investing in business interesting so that you can grow your wealth. Before we dive in, I’d like to remind you I’m not a financial advisor.
I’m just sharing my own thoughts as a successful businessman with 30 plus years of experience. Please do your own research before making any financial decisions.
Let’s kick this off with the news that Elon Musk has almost sold the 10% of Tesla shares he planned to unload. Until now Tesla stock has been a bit like a sprinter running with a parachute attached to his back.
As you can imagine, it just wants to explode but it keeps getting held back. That drag could have been caused by Elon Musk selling his shares. Elon is a drag man.
I’m extremely excited to see what happens next. Now on the surface Elon selling his shares in the first place might seem a little bit strange but when you actually look into it, things become a lot clearer.
Elon has reported over $15 billion tax bill. Yes, I said billions. As he takes no salary from Tesla, it makes sense that you would have to sell Tesla stock to cover this.
Now when Elon must sell stock, it’s not just him selling that can cause a downward trend, it’s actually the algorithms he triggers. A lot of trading is done by these huge computer systems.
And when big positions are sold, it means that they can react violently. This is only magnified by people panic selling from the news that the CEO is selling out. I mean, if you’d invested in one of my companies and all of a sudden I start selling my stock, you’d probably be a bit concerned and consider getting out yourself.
This understandably might cause a train reaction causing the stock price to drop. He did try to avoid some of this backlash by handing over the choice whether to sell his shares or not to a Twitter poll.
But I honestly think he knew exactly what people were going to say as he played on the whole billionaire tax angle at the time. I mean, who wouldn’t want a billionaire to pay more tax?
However, even though he did try and minimize the effect of selling his stock, afterwards Tesla did dip below a $1 trillion market cap for a little while.
But, how does this actually affect me? Well, everything I just mentioned was a bit of a panic at the time, but Elon Musk has sold nearly $14 billion in Tesla stock now and has said he’s nearly finished selling.
This is fantastic news for all investors as it drives negative media attention away from Tesla. This is important as everyday investors are highly effected by herd mentality and tend to follow what everyone else is doing. Therefore by having less negative news surrounding Tesla, it should fill people with confidence to buy back and not to sell.
Honestly, since Elon is nearing the end of his 10% target, it seems to be nothing but go, go, go for Tesla. And everybody seems just as excited as me for Tesla’s future, which is just what the share price needs to explode.
I believe this is a start of an amazing year for Tesla. I know many people think they’re too late and they’ve missed the boat, but I couldn’t disagree more. Tesla have absolutely smashed their end of year targets and they’re showing no signs of slowing down. This news had an absolutely insane impact on the stock.
I will just settle on my phone, watching it go up and up and up, which is always a fun thing to do. This is important as the more targets they meet or even exceed, the more the stock price will react in this way and making investors some nice profits.
Tesla are leading the way when it comes to electric vehicles. And if there’s one thing I’ve noticed throughout 2021 is there’s a lot more Tesla on the road. I can’t even grab a quick Mc D’s without seeing a Tesla anymore, it’s crazy. So let’s talk about exactly what targets they smashed and why I think this is gonna keep happening in the future.
Luckily, Tesla are a public company so we can dig into a lot of their figures. This is understandable, otherwise, people would just be investing blindly.
In 2019, Tesla sold a total of 367,500 vehicles. In 2020, they delivered 499,550 vehicles, including my one. And as 2021 came to a close, companies have been releasing their fourth quarter earnings reports and other information to investors.
And Tesla’s rapport was absolutely staggering. I mean, more times she nearly fell out. When I read the figures in the last quarter of 2021 alone, Tesla delivered a total of 390,000 vehicles just to put that into perspective.
Wall street experts were expecting a total of 266,000 vehicles. So this is a considerable achievement which left the 2021 final delivery figures that are staggering 936,172 vehicles.
Now that’s not a home run. I don’t know what it is. This is extremely promising for Tesla as companies all around the globe have been struggling with supply chain issues, shipping times and staff shortages.
So to overcome all of these obstacles, and not only pleased investors, but absolutely smashed expectations out of the park, I have to say, I take my hat off to you Elon. What if this is just a one-off, how will this affect Tesla in the future? Well, I believe that many people aren’t taking into account a secret weapon that Tesla is waiting to deploy.
Three words, Dormant — Giga — Factories. This is the main reason why I don’t think Tesla are gonna stop exceeding expectations any time soon. They’ve never had much of an issue with demand.
It’s been more of a struggle producing enough cars to meet that demand. Put simply more people want Tesla that they can make. However, that might be started to change as they have two new giga-factories ready to ramp up production.
These are in Austin, Texas, and Berlin, Germany. They are also planning a $188 million extension to their Shanghai factory. Just look at the size of the current giga-factory in Shanghai compared to Berlin and even Texas.
Tesla are really stepping things up. When these are operating at full capacity, they should be able to produce as many vehicles as the biggest car manufacturers.
The exciting thing about the Berlin factory, is this means Europe won’t have to receive cars shipped in from other continents. This means EU countries will avoid some of the import duties and therefore Tesla can increase their margins.
We haven’t even mentioned the 381 acres of land Tesla has bought next to his Austin, Texas factory. Honestly, it feels like Texas is gonna become like Disney land for Tesla at some point, ultimately more cars being produced will mean that their supercharged revenues will grow as well as their subscription revenue from every car.
At the same time as addressing the pickup market which is one of the fastest growing segments over the last decade with a new cyber truck vehicle model.
The beauty of all these is they don’t even need any more factories to make this a reality. However, new factories will probably be announced in 2022 which will continue to grow in the future.
Just think all it took was for Tesla to exceed expectations and within moments of the market opening, Tesla stock was nearly 10% up and close to just over 13.5%.
This is a lot like when Hertz announced they were going to buy a hundred thousand Tesla model 3s causing Tesla stock to jump 13%. Tesla has also proven they aren’t scared of doubling in Bitcoin and has actually made more profit from that than all of it’s car sales combined.
Tesla’s rumored future stock split is actually really exciting. Their last stock split was announced on August the 11th, 2020 and actually happened on August the 31st.
Within that time period, the stock increased by over 80%. It was absolutely insane. Now here’s where it gets interesting. When Elon Musk was asked about stock split a few months ago, he replied with “not yet” which implies it’s on the cars for the future.
There is even a theory going around that Elon Musk is hiding clues in his tweets as to the exact date of the future split.
Recently, I was watching Meek Kevin break down these tweets and I was really intrigued. This is Elon Musk tweeting so it could be mad enough to be true, that’s for sure.
The main reason companies choose to split their shares is so that they can lower the trading price of their stock to a range that seems more comfortable to most investors and ultimately increasing their shares appeal.
However, now we have fractional shares. People are able to invest as little or as much as they like. So the stock price isn’t the big barrier it once was. Think of it like having a nice big chocolate cake and someone came in and sliced it into five pieces. You still have the same amount of cake, but it will be easier to eat.
The slices will be smaller. So therefore a stock split shouldn’t actually affect the price of the stock. It just multiplies everything by five. However, in the past, this process has caused a lot of hype. I mean, just imagine a group of school kids came rushing in wanting to buy a slice of your cake.
You’d probably be able to sell all the slices for more than the original price as the demand would be so high. My point here is, a stock split is often seen as a rally point, creating lots of excitement around a stock and retail investors begin to pile in.
This is great news for people who have invested in the stock and already have the cake before it gets sliced up.
So if a stock split is announced and it looks pretty likely in 2022, then I expect to see a real pump in the stock price as people pile in upon the news. It’s almost like seeing some sort of event. And if you’re not there, you’re just not called. So I’ll definitely be there ’cause I’m the coolest boomer going.
Tesla having a stock split could also be a good thing for the long term as it will make the stock seem cheaper and more accessible to less experienced investors which should help newbie investors invest into Tesla with confidence.
I’m not gonna dive deep into the theories about Elon secret Twitter clues. It’s just speculation and not factually proven. I’ll just let you decode those hidden messages yourself. But if you find something, let me know. Personally, a few months ago I was looking at my portfolio and the profit from Tesla was absolutely mind boggling.
I always buy and hold long-term. But when I saw the numbers so far in the green, I just couldn’t help but sell it an average price of $1,149. So I feel this is a perfect opportunity to clear some details up and reveal what price I bought my shares back then.
I’d really like to ask how do you go about paying taxes when you liquidate your stocks?
Well, but all the Tesla’s stock I sold was held inside a stocks and shares ISA. This is a lot like a rough IRA in the USA. So, therefore, I didn’t have to pay any tax on my profits.
I didn’t sell Tesla to buy Rivian. I sold Tesla and put a very small slice of the profit into Rivian gradually to avoid the IPO hype. To this day, my position in Rivian is not even 2% of what I’d invested in Tesla.
I just wanted some skin in the game and to track the stock. I have most of my profits in cash within the ISA. I bought back aggressively when Tesla stock hit around $900.
That I knew it was an absolute bargain. My average buyback price is currently $924. And I’m now just looking to hold it long term.
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