1 00:00:00,100 --> 00:00:05,300 I mean I stand by my prediction long-term you know that that 2 00:00:05,300 --> 00:00:07,400 Tesla will be the most valuable company in the world. 3 00:00:07,500 --> 00:00:10,500 Tesla will be the most valuable company in the world. 4 00:00:10,600 --> 00:00:13,400 That is what Elon Musk just said, December 22nd. 5 00:00:13,400 --> 00:00:16,600 So that was very recent just this month, he repeated his 6 00:00:16,600 --> 00:00:18,400 prediction again that he thinks his company. 7 00:00:18,400 --> 00:00:21,100 Tesla will become the most valuable company in the world. 8 00:00:21,100 --> 00:00:24,200 Now, he's even made comparisons that he thinks it will become 9 00:00:24,200 --> 00:00:27,700 worth, more than Saudi aramco, more than Apple and more than 10 00:00:27,700 --> 00:00:30,400 all these other companies combined a Massive 11 00:00:30,400 --> 00:00:33,300 multitrillion-dollar market cap company, and these predictions 12 00:00:33,300 --> 00:00:35,400 are ones that lots of people. Hold, we have Steven, from 13 00:00:35,400 --> 00:00:38,700 solving, the money problem, a very popular Channel on YouTube. 14 00:00:39,000 --> 00:00:41,900 He's basically all in on Tesla. That's been as portfolio for a 15 00:00:41,908 --> 00:00:44,200 long period of time. I think he's done really well on 16 00:00:44,200 --> 00:00:46,500 it. And his prediction is that Tesla 17 00:00:46,500 --> 00:00:49,600 like Elon Musk. It will be the most valuable 18 00:00:49,600 --> 00:00:52,500 company in the world with a multitrillion-dollar market cap. 19 00:00:53,000 --> 00:00:55,500 We have Jeremy from Financial education, just putting out a 20 00:00:55,500 --> 00:00:58,100 video. I think yesterday where he gave 21 00:00:58,100 --> 00:01:02,300 his base case for Tesla Implying that it would have 50 billion 22 00:01:02,300 --> 00:01:05,099 dollars of net income. And again have a multi-trillion 23 00:01:05,099 --> 00:01:07,800 dollar valuation. So I'm aware I'm surrounded by a 24 00:01:07,800 --> 00:01:10,100 lot of YouTube channels that are very bullish on Tesla. 25 00:01:10,100 --> 00:01:12,500 They think this company is going to be massive, it's going to be 26 00:01:12,500 --> 00:01:14,400 huge. They have lots of reasons to 27 00:01:14,400 --> 00:01:17,600 back that up and that comes at a time where the stock is down. 28 00:01:17,600 --> 00:01:21,100 Big, it's down 72%. So naturally, a lot of people 29 00:01:21,100 --> 00:01:23,600 are asking the question. Is this a good time to be 30 00:01:23,600 --> 00:01:25,600 jumping into Tesla? And I've asked the same 31 00:01:25,600 --> 00:01:28,800 question, I've come to a different conclusion, so I'm 32 00:01:28,800 --> 00:01:31,900 hopeful that in this So I can share an opposing view about 33 00:01:31,900 --> 00:01:35,500 Tesla of why I'm not buying the stock without being labeled a 34 00:01:35,500 --> 00:01:37,600 hater. I don't have anything against 35 00:01:37,600 --> 00:01:39,300 anybody that's invested in Tesla. 36 00:01:39,300 --> 00:01:41,900 I don't think there are dumb or stupid or anything like that, 37 00:01:42,200 --> 00:01:45,000 but I think it's good to hear opposing viewpoints with any 38 00:01:45,000 --> 00:01:47,600 company. And I think if you get into the 39 00:01:47,600 --> 00:01:50,300 attitude of only hearing viewpoints that reaffirm your 40 00:01:50,300 --> 00:01:53,100 biases, it can cause a little bit of an echo chamber. 41 00:01:53,400 --> 00:01:54,700 So, in this video, I'm laying out, why? 42 00:01:54,700 --> 00:01:58,200 I'm not investing in Tesla, why? I think this company has way 43 00:01:58,200 --> 00:01:59,800 more risk inherent in the investment. 44 00:02:00,000 --> 00:02:01,900 Most investors are giving it credit for. 45 00:02:02,100 --> 00:02:04,300 I think it's a much riskier investment than most people 46 00:02:04,300 --> 00:02:06,700 realize and this is something that I've done routinely and I 47 00:02:06,708 --> 00:02:09,000 hope these videos are valuable. I hope these different 48 00:02:09,000 --> 00:02:10,699 contrarian view points are valuable. 49 00:02:10,900 --> 00:02:13,400 I've done something similar with palantir when it was trading 50 00:02:13,400 --> 00:02:16,200 around $30 per share. I made a video about why I'm not 51 00:02:16,200 --> 00:02:18,000 buying it. I think the company had a lot 52 00:02:18,000 --> 00:02:19,400 more risk. I think investors are too 53 00:02:19,400 --> 00:02:21,500 enthusiastic. I think they're predicting too, 54 00:02:21,500 --> 00:02:24,700 good of a future for it. Pounders like six or seven 55 00:02:24,700 --> 00:02:28,500 dollars a share down its down 70% during the peak of Arc 56 00:02:28,500 --> 00:02:31,300 invest hype. Be wary of 2021. 57 00:02:31,400 --> 00:02:34,100 I made a video warning about Arc, invest how I thought it 58 00:02:34,100 --> 00:02:37,600 would have low perspective. Returns it's down to 80% since 59 00:02:37,600 --> 00:02:40,600 that video and so I'd like to make these opposing Viewpoint 60 00:02:40,600 --> 00:02:43,100 videos because I think they can be helpful when you're doing 61 00:02:43,100 --> 00:02:44,900 research. And I think this one will be 62 00:02:44,900 --> 00:02:47,600 helpful to consider even if your Tesla investor. 63 00:02:47,700 --> 00:02:49,600 That would be the Hope here. So let's go ahead and Jump Right 64 00:02:49,600 --> 00:02:52,500 In will bring up Tesla here. And the big thing that's drawing 65 00:02:52,500 --> 00:02:56,400 attention to test the stock a recently is both at the CEO, 66 00:02:56,400 --> 00:02:59,200 obviously, Elon Musk is an attention-grabbing person. 67 00:02:59,400 --> 00:03:01,300 Tesla Is an attention-grabbing stock. 68 00:03:01,300 --> 00:03:04,600 It's always been that way, but especially so over the past six 69 00:03:04,600 --> 00:03:06,500 months because of the breathtaking fall of the 70 00:03:06,500 --> 00:03:08,700 company. Now, I've seen a lot of dramatic 71 00:03:08,700 --> 00:03:11,600 Falls of companies. We've seen meta, we've seen 72 00:03:11,600 --> 00:03:14,300 PayPal. We've seen Netflix, we've seen a 73 00:03:14,308 --> 00:03:18,200 lot of companies fall, but none quite like Tesla, because the 74 00:03:18,200 --> 00:03:21,100 size of this company was massive, a trillion dollar 75 00:03:21,100 --> 00:03:24,100 market cap and it's down 73 percent year-to-date. 76 00:03:24,400 --> 00:03:27,700 And then if we look at it in, just the past 90 days, three 77 00:03:27,700 --> 00:03:31,800 months, it's down 59%, Don't we look in the past month. 78 00:03:31,900 --> 00:03:34,000 One month, then it's down. More than a percent that day 79 00:03:34,000 --> 00:03:37,500 down 40%. This is a breathtaking dramatic 80 00:03:37,500 --> 00:03:40,900 fall and there's been a lot of finger-pointing people blaming 81 00:03:40,900 --> 00:03:44,600 Elon Musk, Elon Musk blaming the fed and the, you know, it goes 82 00:03:44,600 --> 00:03:47,700 on and on people blame different things but regardless, that is 83 00:03:47,700 --> 00:03:50,800 why people are focused on Tesla. Now, what does this fall do? 84 00:03:50,800 --> 00:03:53,100 Of course, it makes the valuation cheaper for Tesla. 85 00:03:53,100 --> 00:03:55,900 So people are wondering now, they should buy the dip for the 86 00:03:55,900 --> 00:03:59,500 company and I think that question that one question. 87 00:04:00,000 --> 00:04:02,200 Is reliant on one other question. 88 00:04:02,500 --> 00:04:04,700 The other question of whether or not you should buy, the dip is 89 00:04:04,700 --> 00:04:07,700 reliant on. The question is Tesla, a car 90 00:04:07,700 --> 00:04:09,500 company. This is an important question 91 00:04:09,500 --> 00:04:12,400 for Tesla investors. Listen to Gene Munster call in 92 00:04:12,400 --> 00:04:16,300 on the phone for CNBC I think he accurately portrays this 93 00:04:16,300 --> 00:04:20,399 question which of the panelists talked about this today but is 94 00:04:20,399 --> 00:04:22,100 this a tech company or a car company? 95 00:04:22,500 --> 00:04:24,600 And I think that to me is the bigger question. 96 00:04:24,600 --> 00:04:26,200 If you think it's a car company, you shouldn't own. 97 00:04:26,200 --> 00:04:29,700 It this means that they're going to have minimal market share. 98 00:04:29,900 --> 00:04:31,700 Share that their margins will go away. 99 00:04:31,700 --> 00:04:33,600 That other companies are going to catch up to them. 100 00:04:34,000 --> 00:04:36,300 If you think they have some sort of a competitive Tech advantage 101 00:04:36,300 --> 00:04:41,700 or on manufacturing, whether it's FST batteries that will 102 00:04:41,700 --> 00:04:43,500 yield higher margins than typical. 103 00:04:43,500 --> 00:04:46,700 And there's a massive Market doesn't getting into so Melissa, 104 00:04:47,000 --> 00:04:49,800 80% of this is the vortex over the next month. 105 00:04:49,800 --> 00:04:52,000 I think the bigger question investors should be asking here 106 00:04:52,000 --> 00:04:54,500 is this the car or tech company? If you believe it's a tech 107 00:04:54,500 --> 00:04:57,100 company I think you should own it here despite what the the 108 00:04:57,100 --> 00:04:59,500 sock is trying to tell us and think long term, it goes higher 109 00:04:59,500 --> 00:05:02,000 and to Stan, why this question is so important of whether or 110 00:05:02,008 --> 00:05:05,500 not Tesla's a car company or a good tech company is because of 111 00:05:05,500 --> 00:05:07,900 the implications in those definitions. 112 00:05:08,000 --> 00:05:10,700 If you're to break down the differences between a good tech 113 00:05:10,700 --> 00:05:13,700 company in a car company, it looks something like this. 114 00:05:14,000 --> 00:05:16,500 Good tech companies have high Returns on Capital employed, 115 00:05:16,600 --> 00:05:19,100 they're typically asset light, they have high gross, margins, 116 00:05:19,100 --> 00:05:22,000 High profit margins, High operating margins, they have 117 00:05:22,000 --> 00:05:24,300 reoccurring Revenue, they're highly scalable. 118 00:05:24,500 --> 00:05:28,100 They also have high barriers to entry large Network effects. 119 00:05:28,300 --> 00:05:30,300 They have a lock in creating a note. 120 00:05:30,400 --> 00:05:33,200 This is what defines a good tech company. 121 00:05:33,200 --> 00:05:35,500 Now, a car company. On the other hand is very 122 00:05:35,500 --> 00:05:39,800 different car, companies are not good companies period, it's not 123 00:05:39,800 --> 00:05:43,000 a good industry, not good. Place to be car companies have 124 00:05:43,000 --> 00:05:47,000 low Returns on Capital employed, that's also very sporadic car. 125 00:05:47,000 --> 00:05:50,600 Companies are capital intensive, they faced intense competition. 126 00:05:50,700 --> 00:05:53,000 They're highly cyclical. They're sensitive to the 127 00:05:53,000 --> 00:05:55,100 economy, they sell a product, that's not a reoccurring 128 00:05:55,100 --> 00:05:57,800 purchase rather. It's a one-time lumpy expense 129 00:05:58,100 --> 00:05:59,700 that the lifespan can be extended for you. 130 00:05:59,900 --> 00:06:03,600 Years during economic slowness, overall car companies are bad 131 00:06:03,600 --> 00:06:06,300 businesses and their different than tech companies. 132 00:06:06,500 --> 00:06:09,400 That is why they trade differently from tech companies. 133 00:06:09,600 --> 00:06:13,300 An example of this a great example is Ford a car company 134 00:06:13,400 --> 00:06:18,000 for trades at the same price it did in 1987 over 30 years ago, 135 00:06:18,200 --> 00:06:20,600 the only gains over that time period is basically, the 136 00:06:20,600 --> 00:06:23,800 dividends that spade and that has not kept up with the market 137 00:06:23,800 --> 00:06:25,800 Ford's earnings per share. Not a compounder. 138 00:06:25,800 --> 00:06:28,400 They don't just continuously grow over time, rather, they're 139 00:06:28,400 --> 00:06:31,100 highly cyclical and Suitable Ford's Returns on Capital 140 00:06:31,100 --> 00:06:34,500 employed, overall are incredibly low, most of the time, be lower 141 00:06:34,500 --> 00:06:37,600 the cost of capital and more than that, they're also highly 142 00:06:37,600 --> 00:06:40,000 cyclical. This company never knows whether 143 00:06:40,000 --> 00:06:41,900 the Investments it makes are going to be profitable. 144 00:06:41,900 --> 00:06:45,800 And again, the sensitivity to the economy market Cycles. 145 00:06:45,800 --> 00:06:49,000 Make this company overall with its Investments, very 146 00:06:49,000 --> 00:06:51,800 unpredictable, even Ford's revenue is not very stable. 147 00:06:51,800 --> 00:06:55,000 It typically goes down a lot during recessions and takes a 148 00:06:55,008 --> 00:06:56,100 long time. Period to recover. 149 00:06:56,100 --> 00:06:59,200 Now, investors realize all of these things with Ford and it's 150 00:06:59,200 --> 00:07:01,800 priced appropriately. Really four trades below a 151 00:07:01,800 --> 00:07:04,700 commodity multiple of a 12 forward P/E, that means that 152 00:07:04,700 --> 00:07:08,400 investors are literally pricing it as a wealth destructive 153 00:07:08,400 --> 00:07:11,700 company, a company that does not create wealth above the cost of 154 00:07:11,700 --> 00:07:14,700 capital, the pricing a day, seven forward P/E. 155 00:07:14,800 --> 00:07:17,800 So all of these various concerns with Ford the cyclic ality the 156 00:07:17,800 --> 00:07:21,100 sensitivity to the economy, the low Returns on Capital employed. 157 00:07:21,100 --> 00:07:23,700 The historically, bad performance are being priced 158 00:07:23,700 --> 00:07:27,400 into the stock, by investors it trades at a below, commodity 159 00:07:27,400 --> 00:07:29,400 multiple with this seven forward P/E. 160 00:07:29,800 --> 00:07:31,900 A very low multiple. And for again, is not 161 00:07:31,900 --> 00:07:34,900 cherry-picking, it's not unique in this, this is the car 162 00:07:34,900 --> 00:07:39,400 industry companies like GM trade at a 64 PE, because they suffer 163 00:07:39,400 --> 00:07:42,800 from the very same thing. This is an industry-wide problem 164 00:07:42,800 --> 00:07:45,000 with these Investments. Now, the big outlier here, of 165 00:07:45,000 --> 00:07:47,900 course is Tesla. This company does not trade at a 166 00:07:47,900 --> 00:07:52,700 six or seven forward P/E ratio, even after the dramatic 72% 167 00:07:52,700 --> 00:07:55,900 sell-off year-to-date, 50% over the past three months, the 168 00:07:55,907 --> 00:08:00,300 company still trades at a 28.8 forward, P/E ratio, Which is 169 00:08:00,300 --> 00:08:03,300 four times as much as GM and Ford four times the price for 170 00:08:03,300 --> 00:08:06,000 this company's next year's earnings and that's what raises 171 00:08:06,000 --> 00:08:08,900 this big question of if Tesla's different than other car 172 00:08:08,900 --> 00:08:11,700 companies. Because if Tesla is the same 173 00:08:11,900 --> 00:08:15,000 around the same as other car companies, it deserves to fall 174 00:08:15,000 --> 00:08:18,200 in price by another 70%, that's the implications there. 175 00:08:18,500 --> 00:08:20,800 So we have to show that Tesla is different than other car 176 00:08:20,800 --> 00:08:23,500 companies by a substantial amount to be trading up four 177 00:08:23,500 --> 00:08:25,300 times a multiple. So let's go ahead and jump into 178 00:08:25,300 --> 00:08:26,800 this. Question is Tesla different than 179 00:08:26,800 --> 00:08:29,100 a car company. Well, a lot of people attribute 180 00:08:29,100 --> 00:08:32,799 different The Buttes to Tesla one of them that I heard really 181 00:08:32,799 --> 00:08:37,100 frequently six months to a year ago was unlimited demand. 182 00:08:37,100 --> 00:08:40,100 That was one of the biggest talking points from Tesla bowls. 183 00:08:40,299 --> 00:08:43,400 I've heard it over and over and over again, Tesla doesn't have 184 00:08:43,400 --> 00:08:45,600 demand issues. It sells as many vehicles as it 185 00:08:45,600 --> 00:08:48,200 can produce, it's only limited by the amount of vehicles. 186 00:08:48,200 --> 00:08:51,100 It can produce. In fact we have people with 187 00:08:51,100 --> 00:08:52,900 interviews. One year ago that say this 188 00:08:52,900 --> 00:08:55,600 pretty explicitly. Here's one of the most notable 189 00:08:55,600 --> 00:08:59,700 Tesla analysts who is pure. They have unlimited demon so far 190 00:08:59,900 --> 00:09:04,400 Six months, wait times for all cars, unlimited demand so far, 191 00:09:04,400 --> 00:09:08,000 six months plus wait time. That's not a random clip. 192 00:09:08,000 --> 00:09:11,700 I'm not cherry picking here. I could find a dozen two dozen 193 00:09:11,700 --> 00:09:14,900 clips of people saying the same thing on CNBC Tesla, both saying 194 00:09:14,900 --> 00:09:18,300 the exact same thing Tesla has unlimited demand unlimited 195 00:09:18,300 --> 00:09:20,400 demand, unlimited demand. Now what's happened over the 196 00:09:20,400 --> 00:09:22,100 past year? Well it seems like the unlimited 197 00:09:22,100 --> 00:09:25,900 demand thesis that part of the thesis is starting to vanish. 198 00:09:25,900 --> 00:09:28,400 It seems like there's a little bit of cracks in that unlimited 199 00:09:28,400 --> 00:09:29,600 demand Tesla. Sure. 200 00:09:29,800 --> 00:09:32,800 Those are sliding on demand concerns, we have articles going 201 00:09:32,800 --> 00:09:34,900 back, just a couple of months saying that there's a lot of 202 00:09:34,908 --> 00:09:38,200 price Cuts with the model 3 to try to make it so that it can 203 00:09:38,200 --> 00:09:40,600 sell their current Vehicles. They're they're cutting down 204 00:09:40,600 --> 00:09:43,100 prices, which is a clear indication that they have a 205 00:09:43,100 --> 00:09:46,500 lower demand companies, don't lower prices because they have 206 00:09:46,500 --> 00:09:48,600 unlimited demand. Then we have other reports of 207 00:09:48,600 --> 00:09:51,500 Tesla not only cutting prices but actually cutting output. 208 00:09:51,700 --> 00:09:54,000 So they're out right, sizing down the amount of vehicles, 209 00:09:54,000 --> 00:09:56,700 they're producing again. The only reason they do this is 210 00:09:56,700 --> 00:09:59,700 because of demand issues now even though you don't hear this, 211 00:09:59,800 --> 00:10:02,400 The thesis is much anymore because it's starting to be 212 00:10:02,900 --> 00:10:06,300 diminished a little bit. Keep in mind, this was a central 213 00:10:06,300 --> 00:10:09,300 thesis of many Tesla investors just one year ago. 214 00:10:09,500 --> 00:10:12,300 One year ago, the story of Tesla and why it was different than 215 00:10:12,300 --> 00:10:15,500 other car companies? Is it had unlimited amounts of 216 00:10:15,500 --> 00:10:18,800 demand and we're just seeing that not happen. 217 00:10:19,000 --> 00:10:23,300 It seems like Tesla is starting to act and behave like other car 218 00:10:23,300 --> 00:10:26,200 companies with demand limitations and it's starting to 219 00:10:26,208 --> 00:10:29,500 act like a cyclical company. That's sensitive to the economy. 220 00:10:29,800 --> 00:10:31,100 We know what's going on right now. 221 00:10:31,500 --> 00:10:33,500 The situation has changed for the economy. 222 00:10:33,500 --> 00:10:35,500 We have the car dealership guy on Twitter. 223 00:10:35,900 --> 00:10:37,600 That post a lot about the car industry. 224 00:10:37,600 --> 00:10:41,600 Sing imagine, you're a 750 plus credit score rating, which is 225 00:10:41,600 --> 00:10:44,800 the highest score. Now, imagine you come to buy a 226 00:10:44,800 --> 00:10:49,100 car and I offer you a nine percent APR puke Emoji. 227 00:10:49,300 --> 00:10:52,700 Rightfully, so who wants a nine percent interest rate on an auto 228 00:10:52,700 --> 00:10:54,600 loan? I don't need to say much more. 229 00:10:55,300 --> 00:10:58,100 High rates are killing the car business right now. 230 00:10:58,600 --> 00:11:02,100 They're crushing it. A year ago, the unlimited demand 231 00:11:02,100 --> 00:11:04,900 was closely tied to unlimited amounts of capital. 232 00:11:05,000 --> 00:11:07,700 You could get car loans for one or two percent. 233 00:11:07,700 --> 00:11:10,800 I have a loan for a car that is 2.1 percent. 234 00:11:10,900 --> 00:11:13,600 It's about as cheap as money can get, I get more in a savings 235 00:11:13,600 --> 00:11:16,300 account. Now that's change that window of 236 00:11:16,300 --> 00:11:18,600 opportunity. For all these car, companies has 237 00:11:18,600 --> 00:11:21,800 vanished, the FED jacked up, interest rates so high, and it's 238 00:11:21,800 --> 00:11:23,700 going to take a while for them to come back down. 239 00:11:23,900 --> 00:11:28,100 And we're seeing this affect every car company used cars and 240 00:11:28,100 --> 00:11:31,300 the auto business as a whole. Oh, and what we're not seeing is 241 00:11:31,300 --> 00:11:33,200 Tesla being spared from these effects. 242 00:11:33,400 --> 00:11:36,600 We're seeing Tesla be affected by them, with both price, cuts 243 00:11:36,600 --> 00:11:39,700 and demand problems. We're seeing in the data itself. 244 00:11:39,700 --> 00:11:42,100 Used car prices, go down month. After month. 245 00:11:42,100 --> 00:11:45,400 After month, this does have an impact on the overall car 246 00:11:45,400 --> 00:11:48,100 industry and I think a lot of investors are forgetting. 247 00:11:48,400 --> 00:11:51,800 If you can't get cheap interest rates on car loans and it goes 248 00:11:51,800 --> 00:11:54,200 from 2 percent to 9 percent your car. 249 00:11:54,200 --> 00:11:57,500 Payment goes up dramatically, most people can't afford that 250 00:11:57,500 --> 00:11:59,600 they simply can't afford a thousand. 251 00:11:59,700 --> 00:12:01,500 Fifteen hundred dollar car payment. 252 00:12:01,500 --> 00:12:03,800 They could afford a five hundred dollar one or a four hundred 253 00:12:03,800 --> 00:12:05,500 dollar one. But once it gets into the 254 00:12:05,500 --> 00:12:09,000 thousands that is unaffordable for most families and they're 255 00:12:09,000 --> 00:12:12,200 not going to be buying used luxury vehicles or new luxury 256 00:12:12,200 --> 00:12:14,500 Vehicles when they can't get cheaper Credit. 257 00:12:14,500 --> 00:12:17,000 Now to add on to those concerns. That brings me to the next part. 258 00:12:17,000 --> 00:12:20,600 If Tesla's not a car company and it said, a different company, a 259 00:12:20,608 --> 00:12:23,300 different entity, a really quality tech company. 260 00:12:23,300 --> 00:12:26,700 Then it's not going to be as economically sensitive as most 261 00:12:26,700 --> 00:12:29,300 car companies, but I don't know if that's going to be the case. 262 00:12:29,300 --> 00:12:33,200 I I really am unsure about that. I think Tesla may be about as 263 00:12:33,200 --> 00:12:35,500 economically sensitive to the economy. 264 00:12:35,500 --> 00:12:38,800 As most car companies, not only is it affected by interest rates 265 00:12:39,200 --> 00:12:42,500 but economically sensitive companies have a wealth effect. 266 00:12:42,600 --> 00:12:45,700 We have home prices, going down month after month, after month, 267 00:12:45,700 --> 00:12:47,700 when home prices go down, it makes you feel poor. 268 00:12:47,800 --> 00:12:50,800 When you feel poor, you don't buy high-end premium Vehicles, 269 00:12:51,100 --> 00:12:54,800 we have the stock market going down dramatically the S&P, 500 270 00:12:54,800 --> 00:12:58,800 down, 20 plus percent that QQQ down 30 plus percent that as a 271 00:12:58,808 --> 00:13:01,300 massive wealth. Fact, people feel poor this year 272 00:13:01,300 --> 00:13:03,700 than last year. And again, if most people feel 273 00:13:03,700 --> 00:13:06,700 poor, most people are going to be more reluctant to buy premium 274 00:13:06,700 --> 00:13:08,600 Vehicles. So I look at the whole situation 275 00:13:08,600 --> 00:13:11,000 here and I ask myself is Tesla really that much less 276 00:13:11,000 --> 00:13:14,600 susceptible to the overall economy than most car companies 277 00:13:15,000 --> 00:13:17,500 and I just don't know. But I think it's very risky and 278 00:13:17,500 --> 00:13:20,500 I think most investors are assuming that it's not when 279 00:13:20,500 --> 00:13:23,000 there's a good chance that it is that it's going to be just as 280 00:13:23,000 --> 00:13:25,300 susceptible as most other car companies. 281 00:13:25,300 --> 00:13:28,000 Now we bring up the next point of the question as Tesla, 282 00:13:28,000 --> 00:13:31,800 another car company. Of the big moat advantages that 283 00:13:31,800 --> 00:13:35,500 lots of Tesla bulls have cited. Is that Tesla has a unique 284 00:13:35,500 --> 00:13:37,900 Advantage with their Giga factories and with their 285 00:13:37,900 --> 00:13:40,600 manufacturing prowess. They basically are so 286 00:13:40,600 --> 00:13:42,500 sophisticated. And so Advanced with their 287 00:13:42,500 --> 00:13:46,600 robots and Manufacturing process that they can manufacture these 288 00:13:46,600 --> 00:13:49,600 vehicles for a cheaper price, which raises their margins 289 00:13:49,600 --> 00:13:53,700 overall and Tesla has gone to Great Lengths to sort of show 290 00:13:53,700 --> 00:13:55,500 off their, their Advanced manufacturing. 291 00:13:55,500 --> 00:13:57,800 With these really slick Productions. 292 00:13:57,800 --> 00:14:00,100 Look at this video here. This is from the Ella YouTube 293 00:14:00,100 --> 00:14:25,100 channel. By the way, I just find this 294 00:14:25,100 --> 00:14:28,700 stuff so amazing and fascinating, what we're able to 295 00:14:28,700 --> 00:14:31,700 create, its it is incredible. I have to give Tesla engineers 296 00:14:31,700 --> 00:14:34,000 in the robotic Engineers. I mean, this stuff is just 297 00:14:34,000 --> 00:15:01,600 fascinating. You know, I'm thinking about how 298 00:15:01,600 --> 00:15:03,600 they're filming this. Do they have some, like 299 00:15:03,700 --> 00:15:07,000 world-class drone flyer in here. Just going in between the 300 00:15:07,000 --> 00:15:09,100 machines, hoping not to get stamped by one of them 301 00:15:09,500 --> 00:15:12,200 impressive. They got someone good with a 302 00:15:12,200 --> 00:15:22,900 drone here I really think so The Tesla gigafactory is in their 303 00:15:22,900 --> 00:15:26,300 manufacturing process is legitimately incredible and I 304 00:15:26,300 --> 00:15:29,000 know why they would want to show this off because it's incredibly 305 00:15:29,000 --> 00:15:31,400 impressive to show what they've done and what they've 306 00:15:31,400 --> 00:15:33,600 accomplished. But again the question here is 307 00:15:33,600 --> 00:15:36,900 not if Tesla's impressive but if it's different than a car 308 00:15:36,900 --> 00:15:40,300 company, let's go ahead and look at another Factory. 309 00:15:40,400 --> 00:15:57,800 This one happens to be by Ford. This is a walkthrough of a Ford 310 00:15:57,800 --> 00:16:01,500 factory by the YouTuber jerryrigeverything and they 311 00:16:01,500 --> 00:16:03,700 invited him in. They don't have a fancy drone 312 00:16:03,800 --> 00:16:06,300 with an incredibly skilled pilot for that drone. 313 00:16:06,600 --> 00:16:08,500 But rather they just walked through and he filmed some of 314 00:16:08,500 --> 00:16:11,200 the process here. Now it looks like Ford has like 315 00:16:11,200 --> 00:16:12,700 a different color scheme of hair. 316 00:16:12,700 --> 00:16:15,700 A lot of it is this yellow and orange but if you look at the 317 00:16:15,700 --> 00:16:18,000 robotics I think it's I think it's pretty neat. 318 00:16:18,000 --> 00:16:22,000 What Ford was able to do? They have similar to Tesla these 319 00:16:22,000 --> 00:16:26,000 gigantic hydraulic robots Basically assembling every 320 00:16:26,000 --> 00:16:29,700 single aspect of the car. In fact, watching this entire 321 00:16:29,700 --> 00:16:32,600 video, you realize how little humans are doing now. 322 00:16:32,700 --> 00:16:35,700 Now not only does it actually assemble it and build it, but he 323 00:16:35,708 --> 00:16:38,100 goes on to describe how this little robot hair with that 324 00:16:38,100 --> 00:16:41,100 camera goes around and takes pictures of all the different 325 00:16:41,100 --> 00:16:44,500 parts of the truck to make sure that every single component is 326 00:16:44,500 --> 00:16:47,500 in the exact right spot. If it's off by 1 cm, they'll 327 00:16:47,500 --> 00:16:50,600 have a human common inspected and look at what's going wrong 328 00:16:50,600 --> 00:16:53,500 with it, because they can actually do the checking with 329 00:16:53,500 --> 00:16:56,300 robots and cameras. Then they move it, the move it 330 00:16:56,300 --> 00:16:59,600 along with this big robot here, that basically Scoops. 331 00:16:59,600 --> 00:17:02,800 The truck up and moves it along and it goes through the assembly 332 00:17:02,800 --> 00:17:06,599 process, humans, do part of it. They just make sure the robots 333 00:17:06,599 --> 00:17:09,099 are doing their jobs. The humans do very little in and 334 00:17:09,099 --> 00:17:12,099 of themselves and this is the process. 335 00:17:12,500 --> 00:17:16,500 When I looked through Tesla's, gigafactory, I think it is 336 00:17:16,500 --> 00:17:19,200 incredibly impressive, but then I looked through Ford's 337 00:17:19,200 --> 00:17:21,700 factories and I think, again, they're incredibly impressive. 338 00:17:21,900 --> 00:17:23,599 And I think you should do the same, especially if you're a 339 00:17:23,608 --> 00:17:25,800 Tesla. Take a look at this video from 340 00:17:25,800 --> 00:17:27,599 jerryrigeverything. I'll put it in the description 341 00:17:27,599 --> 00:17:29,200 of this video. Watch the whole thing. 342 00:17:29,200 --> 00:17:32,600 It shows the entire process beginning to end and almost 343 00:17:32,600 --> 00:17:35,900 everything is done by robots. They eventually test the truck 344 00:17:35,900 --> 00:17:38,400 and case it has any leaks and any part of it. 345 00:17:38,600 --> 00:17:41,100 They actually spray it down with water just to make sure no Park 346 00:17:41,100 --> 00:17:43,400 gets wet. And then after a test drive by 347 00:17:43,400 --> 00:17:46,000 an employee, that's when it's finally good to go. 348 00:17:46,000 --> 00:17:49,300 It's cleaned off and you have the Ford electric truck there. 349 00:17:49,300 --> 00:17:51,700 So when I look at Ford's manufacturing process and I see 350 00:17:51,700 --> 00:17:54,200 that it's also very impressive and almost entirely done. 351 00:17:54,300 --> 00:17:57,400 By robots. I asked the question is Tesla 352 00:17:57,400 --> 00:18:00,200 that much different than Ford even in the manufacturing 353 00:18:00,200 --> 00:18:03,300 process. Now I'm no manufacturing expert. 354 00:18:03,300 --> 00:18:05,100 Maybe there's some differences, I'm missing. 355 00:18:05,400 --> 00:18:07,600 But when I look at both, the factories and the walkthroughs 356 00:18:07,600 --> 00:18:10,400 of both of them, it looks like almost everything in both 357 00:18:10,400 --> 00:18:13,400 factories is being done by robots, completely automated. 358 00:18:13,700 --> 00:18:16,700 And the big idea here, that Tesla's entirely different than 359 00:18:16,700 --> 00:18:18,700 Ford because of the manufacturing process. 360 00:18:19,300 --> 00:18:20,900 I don't know. Again, it's something that I 361 00:18:20,900 --> 00:18:23,100 think is a little risky. I don't know how different they 362 00:18:23,100 --> 00:18:25,300 really are to me. Look very similar. 363 00:18:25,400 --> 00:18:28,600 So we have the thesis part 1 Tesla is different than a car 364 00:18:28,600 --> 00:18:30,600 company because it has unlimited demand. 365 00:18:30,900 --> 00:18:32,600 I don't really think that's the case. 366 00:18:32,600 --> 00:18:34,700 I think we're seeing that Tesla's, more similar to other 367 00:18:34,700 --> 00:18:37,700 car companies with limitations to demand and economic 368 00:18:37,700 --> 00:18:40,300 sensitivity. Then we have thesis part to 369 00:18:40,700 --> 00:18:43,100 Teslas different because of its manufacturing prowess. 370 00:18:43,400 --> 00:18:45,800 Again, I'm not really seeing a huge difference there. 371 00:18:45,800 --> 00:18:48,500 Maybe I'm missing something but they look very similar to me. 372 00:18:48,900 --> 00:18:52,700 Let's move on to Tesla thesis part 3, full self-driving 373 00:18:52,900 --> 00:18:55,500 Tesla's, a tech company. Penny and not a car company 374 00:18:55,600 --> 00:18:58,400 because of its Advanced full self driving and the 375 00:18:58,400 --> 00:19:02,600 availability the capability of their cars to be upgraded even 376 00:19:02,600 --> 00:19:04,900 after you buy them. So let's take a look together at 377 00:19:04,900 --> 00:19:07,100 the full self driving. This is something that really 378 00:19:07,100 --> 00:19:09,600 would separate Tesla from any other car company. 379 00:19:09,800 --> 00:19:12,900 Now, luckily through the magic of YouTube, we have some content 380 00:19:12,900 --> 00:19:16,000 in some video footage on this as well, for Marcus Brown's 381 00:19:16,000 --> 00:19:17,800 Channel. It's a Great Tech reviewer. 382 00:19:18,500 --> 00:19:21,600 One of the most popular ones, but he actually did a full 383 00:19:21,600 --> 00:19:24,200 self-driving, full drive like a 20-minute. 384 00:19:24,300 --> 00:19:28,200 Plus drive on his way from his home to work where he films in 385 00:19:28,208 --> 00:19:32,300 his studio and I really liked him doing this because I think 386 00:19:32,300 --> 00:19:34,900 that he gave a very transparent honest review of this. 387 00:19:34,900 --> 00:19:37,500 I thought it was very straightforward and he describes 388 00:19:37,500 --> 00:19:40,200 the pros and cons of it. Now this is him on the freeway 389 00:19:40,200 --> 00:19:43,300 and he says that the best part of full self-driving, where it 390 00:19:43,300 --> 00:19:45,800 has it down? Best is on the freeway but he 391 00:19:45,808 --> 00:19:49,500 still describes the challenges with full self-driving, get 392 00:19:49,500 --> 00:19:50,900 stressful. I'm going to show you actually 393 00:19:50,900 --> 00:19:53,400 what it's showing me on the screen which is its kind of 394 00:19:53,408 --> 00:19:54,800 picking a spot. Right now. 395 00:19:55,100 --> 00:19:58,600 Wow, that is assertive. That was in assertive move right 396 00:19:58,600 --> 00:20:01,900 there, okay? That qualifies as assertive. 397 00:20:02,400 --> 00:20:04,400 So he's saying it's assertive Tesla. 398 00:20:04,700 --> 00:20:06,800 It was trying to get into the slain it needed to. 399 00:20:06,800 --> 00:20:09,900 So it really cut in and front of someone a very assertive move. 400 00:20:10,000 --> 00:20:11,400 So it goes through this drive narrating. 401 00:20:11,400 --> 00:20:16,100 It and Marcus says repeatedly that right now full self-driving 402 00:20:16,100 --> 00:20:19,300 would not be able to make this drive without his interaction, 403 00:20:19,300 --> 00:20:21,300 with out him watching the vehicle. 404 00:20:21,500 --> 00:20:23,800 So even though it's called Full self-driving, that's the label 405 00:20:23,800 --> 00:20:25,500 of it. It's not really full 406 00:20:25,500 --> 00:20:28,400 self-driving. It's more like a helpful tool to 407 00:20:28,400 --> 00:20:31,200 drive but you still have to be on guard watching the car in 408 00:20:31,200 --> 00:20:33,600 case it screws up. In fact in one part here that 409 00:20:33,600 --> 00:20:36,900 we're going to watch this is where he had actually interject 410 00:20:36,900 --> 00:20:39,400 and take over the car because it was about to do something. 411 00:20:39,600 --> 00:20:41,400 He didn't want it to do something that would not have 412 00:20:41,408 --> 00:20:46,600 been good which is like 2 to 5 and then 5 to 2. 413 00:20:47,300 --> 00:20:50,100 Now it's gone. This is not going to work. 414 00:20:50,100 --> 00:20:53,100 If it doesn't see that it's yet their Zone here. 415 00:20:53,100 --> 00:20:54,000 It's not hard. Is it strong? 416 00:20:54,200 --> 00:20:57,300 Yeah, I'm taking over so, that was bad. 417 00:20:57,700 --> 00:21:00,600 There's a cone over there. I took over and I also need to 418 00:21:00,600 --> 00:21:03,700 be back over to the right, which this car didn't. 419 00:21:03,800 --> 00:21:06,400 Now he's having to cut like across the utilization. 420 00:21:06,400 --> 00:21:09,000 Is the second link here. So I'm going to go back into the 421 00:21:09,000 --> 00:21:12,700 correct Lane here. Now again I'm not trying to bash 422 00:21:12,700 --> 00:21:15,000 full self-driving. What they've accomplished so far 423 00:21:15,000 --> 00:21:18,400 is amazing, but this really isn't full self-driving. 424 00:21:18,500 --> 00:21:21,500 He has to be on guard and on watch the entire time. 425 00:21:21,500 --> 00:21:24,600 He's making this drive and in some cases what I've heard from 426 00:21:24,600 --> 00:21:27,500 feedback from people, I know personally that own Tesla's have 427 00:21:27,500 --> 00:21:30,700 a couple friends and people that I work with the onnum, they say 428 00:21:30,700 --> 00:21:34,600 that in some cases full self driving from Tesla, is almost 429 00:21:34,600 --> 00:21:36,600 more stressful than just driving yourself. 430 00:21:36,800 --> 00:21:38,700 It's almost like having a student driver. 431 00:21:39,000 --> 00:21:40,800 It gets it, right? And most cases. 432 00:21:40,900 --> 00:21:43,200 But you still have to be on guard, you have to be ready to 433 00:21:43,200 --> 00:21:45,300 take over the steering wheel because they might make a dumb 434 00:21:45,300 --> 00:21:48,900 choice and so you're almost on more guard and more stressed out 435 00:21:48,900 --> 00:21:50,300 than if you're just driving yourself. 436 00:21:50,500 --> 00:21:52,800 That's the feedback that I've often received. 437 00:21:53,000 --> 00:21:56,100 In either case, Tesla does not have full self-driving. 438 00:21:56,300 --> 00:21:58,700 Full self-driving would mean that you can punch in a 439 00:21:58,700 --> 00:22:02,400 location, you can recline in your chair, close your eyes, or 440 00:22:02,400 --> 00:22:05,000 you can recline and watch YouTube or Netflix, and not even 441 00:22:05,000 --> 00:22:07,500 worry about the road. That's the true definition of 442 00:22:07,500 --> 00:22:10,200 full self-driving. Tesla simply isn't there in 443 00:22:10,200 --> 00:22:13,100 fact, because The term full self-driving is a bit of a 444 00:22:13,100 --> 00:22:15,200 misnomer, it's kind of an overstatement for its 445 00:22:15,200 --> 00:22:17,900 capabilities. California has outright banned 446 00:22:17,900 --> 00:22:21,700 Tesla from calling it, full self-driving saying they cannot 447 00:22:21,700 --> 00:22:25,500 sell it under that label anymore and that's one of their biggest 448 00:22:25,500 --> 00:22:27,600 markets. So the full self driving aspect 449 00:22:27,600 --> 00:22:30,600 of Tesla is cool. I think it's very impressive, 450 00:22:30,800 --> 00:22:32,900 but I don't think it's a home run right now. 451 00:22:32,900 --> 00:22:36,000 It's not gotten to the last step of being, totally fully 452 00:22:36,000 --> 00:22:38,900 autonomous and not having anyone have to interact as it's 453 00:22:38,900 --> 00:22:40,500 driving. And at the same time, again, if 454 00:22:40,500 --> 00:22:42,300 we're asking. The question between the Tesla 455 00:22:42,300 --> 00:22:45,200 and different Vehicles. A lot of vehicles can Aid 456 00:22:45,200 --> 00:22:48,900 drivers on the freeway, just like the strongest point of full 457 00:22:48,900 --> 00:22:51,300 self-driving. There's many cars now that have 458 00:22:51,300 --> 00:22:53,900 cameras and sensors and they realign trucks. 459 00:22:53,900 --> 00:22:55,900 They rely on cars. If they're starting to go off 460 00:22:55,900 --> 00:22:57,800 the road, they warned about trucks. 461 00:22:58,100 --> 00:22:59,400 They'll automatically press the brake. 462 00:22:59,400 --> 00:23:02,300 If you get too close to another car, I've actually seen that 463 00:23:02,300 --> 00:23:05,100 happen. We're a non Tesla vehicle slams. 464 00:23:05,100 --> 00:23:07,000 The brakes because a car in front of it is getting too 465 00:23:07,000 --> 00:23:08,500 close. Now this probably is not as 466 00:23:08,500 --> 00:23:12,200 advanced as Tesla by any means but it is Their cars outside of 467 00:23:12,200 --> 00:23:14,600 Tesla's are doing some of these functions. 468 00:23:14,600 --> 00:23:17,600 Now, again, the problem for Tesla right now is that, if it's 469 00:23:17,600 --> 00:23:20,500 not full self-driving than it's something other than full 470 00:23:20,500 --> 00:23:24,600 self-driving and that has huge implications, Tesla cannot run a 471 00:23:24,600 --> 00:23:27,900 robo taxi Network, they can't have the massive economics, 472 00:23:27,900 --> 00:23:31,200 implied in a lot of valuations, unless they get to that end 473 00:23:31,200 --> 00:23:34,300 point where they really have fully autonomous full self 474 00:23:34,300 --> 00:23:36,500 driving at the same time, there's been a lot of 475 00:23:36,508 --> 00:23:38,600 predictions. A lot of promises from Elon Musk 476 00:23:38,600 --> 00:23:40,100 at this is right around the corner. 477 00:23:40,400 --> 00:23:46,100 This is Back in 2014 next year we'll probably be 90% capable of 478 00:23:46,100 --> 00:23:47,800 autopilot. Like so 90s, the model S and 479 00:23:47,800 --> 00:23:50,100 model X. At this point, I can drive 480 00:23:50,100 --> 00:23:52,400 autonomously with greater safety than a person. 481 00:23:52,800 --> 00:23:55,800 Right now, we're still on track for being able to go 482 00:23:56,400 --> 00:23:59,000 cross-country from LA to New York by the end of the year 483 00:23:59,000 --> 00:24:02,800 fully autonomous. But next year for sure We'll 484 00:24:02,800 --> 00:24:05,800 have over a million Robo taxis on the road, I'm extremely 485 00:24:05,800 --> 00:24:10,800 confident of achieving full autonomy and releasing it to the 486 00:24:10,800 --> 00:24:14,300 Tesla customer base. Next year, Tesla will solve 487 00:24:14,300 --> 00:24:19,500 level for FSD, okay? It's looking quite likely that 488 00:24:19,500 --> 00:24:21,800 it will be next year. So Elon Musk has been making 489 00:24:21,800 --> 00:24:23,900 these repeated promises a full self-driving. 490 00:24:23,900 --> 00:24:26,700 Going back all the way to 2014 every year. 491 00:24:26,700 --> 00:24:29,600 It's a year down the road or by the end of this year. 492 00:24:29,800 --> 00:24:31,400 They're going to make the next big break. 493 00:24:31,600 --> 00:24:34,800 Through with full self driving. Here we are in 2022. 494 00:24:35,000 --> 00:24:39,300 Almost in 2023, we have Marcus Brownlee driving his Tesla. 20 495 00:24:39,300 --> 00:24:42,000 minutes from his house to work, and you have to take over the 496 00:24:42,000 --> 00:24:44,900 vehicle twice, two times in 20 minutes. 497 00:24:45,400 --> 00:24:47,200 That's not close to full self-driving. 498 00:24:47,500 --> 00:24:50,000 It's impressive but it's not full self driving. 499 00:24:50,000 --> 00:24:52,600 Now, maybe he'll get it right next year and that'll be the 500 00:24:52,600 --> 00:24:54,800 year that it actually has full self-driving. 501 00:24:55,100 --> 00:24:59,000 But as of right now with the data that we have people drive 502 00:24:59,000 --> 00:25:03,300 Tesla's, not the car, the card, Not drive itself and people 503 00:25:03,300 --> 00:25:05,800 drive forwards. They drive Ford trucks. 504 00:25:06,100 --> 00:25:08,800 In both cases, people are driving the vehicles. 505 00:25:08,800 --> 00:25:10,800 People have their hands on the steering wheels. 506 00:25:11,100 --> 00:25:13,400 People are breaking. People are looking through the 507 00:25:13,400 --> 00:25:16,400 windshield and making judgment calls and even if the Tesla can 508 00:25:16,400 --> 00:25:19,500 do some things to Aid in the driving, it's still people that 509 00:25:19,500 --> 00:25:22,300 have to be watching over it. There are legally mandated to 510 00:25:22,300 --> 00:25:24,400 make that happen. So again, looking back on all of 511 00:25:24,400 --> 00:25:26,300 this, I'm not trying to bash Tesla. 512 00:25:26,300 --> 00:25:29,000 That's not my goal here. I think it's an amazing company 513 00:25:29,000 --> 00:25:31,000 and I think it's incredible what they've accomplished. 514 00:25:31,000 --> 00:25:33,700 I'm glad The company exists. But when you're paying for a 515 00:25:33,700 --> 00:25:38,000 stock, you're paying a price a set price for the market cap. 516 00:25:38,100 --> 00:25:42,100 Right now, Tesla's at 350 billion dollar company and a lot 517 00:25:42,100 --> 00:25:45,600 of the thesis surrounding the implied market cap. 518 00:25:45,600 --> 00:25:48,700 And these huge predictions about a multi-trillion dollar company 519 00:25:49,000 --> 00:25:50,700 or an Elon. Musk's words, the biggest 520 00:25:50,700 --> 00:25:53,300 company in the world. I think it's difficult to get 521 00:25:53,300 --> 00:25:55,100 behind it. At least for me I don't see 522 00:25:55,100 --> 00:25:58,600 Tesla's having unlimited demand. I see them being affected by 523 00:25:58,600 --> 00:26:00,900 interest rates and being sensitive to the economy. 524 00:26:01,200 --> 00:26:04,700 I See Tesla's, manufacturing process is all that different 525 00:26:04,700 --> 00:26:06,400 than competitors. I don't see. 526 00:26:06,400 --> 00:26:09,400 Full self-driving is really being full self-driving. 527 00:26:09,700 --> 00:26:12,600 I see it as something cool but it's not autonomous driving 528 00:26:12,600 --> 00:26:15,000 quite yet. And I think the company's 529 00:26:15,000 --> 00:26:18,000 valuation implies something that I'm not seeing what the 530 00:26:18,000 --> 00:26:21,300 fundamentals of the company. And if Tesla is a tech company, 531 00:26:21,600 --> 00:26:24,100 we can compare it from not even car companies, but we can 532 00:26:24,100 --> 00:26:25,700 compare it to other tech companies. 533 00:26:25,900 --> 00:26:29,200 Let's compare Tesla to Adobe, for example, Adobe trades at a 534 00:26:29,208 --> 00:26:33,400 cheaper price based on next year's, PE ratio even if Tesla 535 00:26:33,400 --> 00:26:36,000 outperforms and does five dollars in earnings per share 536 00:26:36,000 --> 00:26:40,300 next year, hire the most analysts, expectations, Adobe 537 00:26:40,300 --> 00:26:42,700 still cheaper. It's still trades at a lower PE 538 00:26:42,700 --> 00:26:44,800 ratio. Adobe has a much higher free 539 00:26:44,800 --> 00:26:47,100 cash flow yield. So for the price, you're paying 540 00:26:47,100 --> 00:26:49,000 for the market cap, you're getting a lot more actual free 541 00:26:49,000 --> 00:26:52,200 cash. Flows Adobe has incredibly fast 542 00:26:52,200 --> 00:26:55,100 growing Revenue. Very Tesla like Revenue. 543 00:26:55,400 --> 00:26:56,900 But the difference is is adobe's. 544 00:26:56,900 --> 00:26:59,000 Revenue is almost entirely reoccurring. 545 00:26:59,100 --> 00:27:02,000 It's almost all subscription-based test Is off 546 00:27:02,000 --> 00:27:05,400 of large, lumpy sales of vehicles, which are difficult to 547 00:27:05,400 --> 00:27:09,000 sell during economic slowness. We have adobe's free, cash flow, 548 00:27:09,400 --> 00:27:11,300 credibly good. Hi free cash. 549 00:27:11,300 --> 00:27:14,800 Flow growth and low amounts of stock-based compensation similar 550 00:27:14,800 --> 00:27:18,200 to Tesla, but again, very good, free cash flow growth. 551 00:27:18,200 --> 00:27:20,400 While being subscription-based and not. 552 00:27:20,400 --> 00:27:23,000 Having as much cyclicality, Adobe has been doing, share 553 00:27:23,000 --> 00:27:25,600 BuyBacks while Tesla has been diluting the shareholder. 554 00:27:25,600 --> 00:27:28,000 Issuing more shares. Adobe has higher Returns on 555 00:27:28,000 --> 00:27:31,400 Capital employed by quite a bit Dobby has higher gross. 556 00:27:31,500 --> 00:27:35,000 Ian's Dobby has higher operating margins, Adobe has higher profit 557 00:27:35,000 --> 00:27:38,000 margins, all across the board, and they're very consistent 558 00:27:38,100 --> 00:27:40,600 because, again, it's a subscription tech company 559 00:27:40,700 --> 00:27:43,000 selling software. So I don't know what I'm missing 560 00:27:43,000 --> 00:27:44,300 here. But when I look at this, I'd 561 00:27:44,300 --> 00:27:46,200 rather just buy something like Adobe. 562 00:27:46,400 --> 00:27:48,800 Then something like Tesla. That's my thoughts for now. 563 00:27:48,800 --> 00:27:50,800 I hope you enjoyed the video. Let me know what you think. 564 00:27:50,800 --> 00:27:33,100 See you in the next one. Ian's Dobby has higher operating 565 00:27:33,100 --> 00:27:36,500 margins, Adobe has higher profit margins, all across the board, 566 00:27:36,500 --> 00:27:38,700 and they're very consistent because, again, it's a 567 00:27:38,700 --> 00:27:41,800 subscription tech company selling software. 568 00:27:41,800 --> 00:27:43,300 So I don't know what I'm missing here. 569 00:27:43,300 --> 00:27:45,600 But when I look at this, I'd rather just buy something like 570 00:27:45,600 --> 00:27:47,500 Adobe. Then something like Tesla. 571 00:27:47,900 --> 00:27:49,800 That's my thoughts for now. I hope you enjoyed the video. 572 00:27:49,800 --> 00:27:51,600 Let me know what you think. See you in the next one.