Aaron Hasson

Caroline Tao
Charles Crawford
Igor Kaspin

About Tesla
Founded in 2003
Assembled a team of specialists from the
car industry based in Silicon Valley
Roadster : first production sport car
Model S: first truly mass-produced car; fully
assembly in-house.
Crisis in the car industry
Purchased NUMMI plant operational onethird less than normal cost, $1billion
Company-owned sales stores

About Tesla Contin

(Values in
Millions)

Mkt Cap

EV

P/E

EV/EBITDA

EV/Sales

Tesla

31,560

34,006

-426.4

759.1

16.9

BMW

54,570

120,020

9.4

10.2

1.5

Expected to grow in future

High company value
Revenue increased from $116,744,000 to
$966,931,000 between 2010-13
Lower operating expenses due to cost
saving

Sales Forecast
2013

2014

2015

2022

2023

2024

Total # of cars sold in the market

(in million)

69

71

73

90

92

95

All EVs market share

0.20%

0.21%

0.30%

5.39%

7.55%

10.20%

Growth rate of EV market

5.53%

42.14%

40%

35%

20%

Tesla Market Share

16%

22%

27%

18%

15%

12%

Tesla Sales Revenue (in billion)

1.82

2.67

4.86

57.21

66.68

71.95

Tesla Sales Growth

47.01%

81.82%

30.38%

16.56%

7.90%

Tesla SG&A

22.00%

21.56%

21.13%

18.34%

18.00%

18.00%

Assumptions: SG&A: Decrease 2% every year.

Cost of sales: Decrease 2.75% per year from 77% to 46%
Gross margin: Increase 2.2% per year from 22% to 46%

Income Statement
2014

2015

2023

2024

Revenues

3.090B

4.871B

66.844B

72.126B

Cost of revenues

2.162B

3.408B

32.064B

32.614B

Gross Profit

826M

1.303B

29.644B

33.573B

Total Operating
Expenses

975M

1.252B

17.181B

18.539B

EBITDA

(149)M

50M

12.462B

15.034B

Net Income

(248)M

(350)M

4.172B

5.454B

Assumptions:
Depreciation: 5.27% of
sales
Tax Rate: 40%
ZEV credit sales: 76.1
million in 2014
Not included stock-based
compensation in
calculations

Discounted Cash Flow

2014

2015

2023

2024

Operating Cash Flow

(29)

(93)

7.694B

9.254B

Working Capital

2.030B

3.201B

3.403B

3.672B

Change in Working
Capital

1.440B

1.170B

483M

268M

CAPEX

218M

256M

3.521B

3.800B

Free Cash Flow

(1.688)B

(1.521)B

3.689B

5.185B

Assumptions:
Capex = depreciation = change in
fixed assets

Discounted Cash Flow Continu

Total PV 2014 - 2024

2,947,449

Terminal Value

187,932,552

Total PV of Terminal Value

65,913,264

Total Firm Value

68,860,713

Total Equity Value

68,860,713

# of shares after offering

125,380

Value per share

$442.95

Assumptions:
Terminal Value: 10x EBITDA
Required Return: 11%
Current Risk free rate: 2.24%

Beta: 1.4
Risk Premium: 6.29%

Lets compare to BMW again...

(Values in Millions)

Mkt Cap

EV

P/E

EV/EBITDA

EV/Sales

Tesla (Now)

31,560

34,006

-426.4

759.1

16.9

BMW (Now)

54,570

120,020

9.4

10.2

1.5

Tesla (Future)

55,537

55,537

10.18

3.69

0.77

Current VS Optimistic Case

Current

2020

2021

2022

2023

2024

Tesla Market Share

21%

20%

18%

15%

12%

Tesla Sales Revenue

30,741

43,976M

57,207M

66,682M

71,952M

Value per share

$442.95
VS

Optimistic

2020

2021

2022

2023

2024

Tesla Market Share

23%

22%

20%

17%

14%

Tesla Sales Revenue

33,669M

48,264M

63,564M

75,573M

83,944M

Value per share

$516.43

Current VS Pessimistic Case

2020

2021

2022

2023

2024

Tesla Market Share

21%

20%

18%

15%

12%

Tesla Sales Revenue

30,741

43,976M

57,207M

66,682M

71,952M

Value per share

$442.95
VS
2020

2021

2022

2023

2024

Tesla Market Share

18%

15%

10%

8%

5%

Tesla Sales Revenue

23B

29B

27B

30B

19B

Value per share

$121.61

1.1 Million Cars sold by 2024?

EV Market Only Hits 8%, Not 10%
Sales Price per Car Decreases 5% per year
Decreasing Market Share - Only 8% in 2024

Thank You!