Should local investors take Tesla for a spin?
Very few South African investment funds seem keen to offer clients a bite of this fast-paced, new-tech disrupter
South Africans often note proudly that multi-entrepreneur phenomenon Elon Musk was born here, but how many of them invest in his company? And should they? There are not many local funds invested in Musk’s main listed entity, Tesla, and those that do invest typically in tracker technology funds as part of a bigger portfolio. Increasingly, however, one of the big new-tech companies, sometimes called "Fangs" (Facebook, Amazon, Netflix, Google), is on the radar. Tesla constitutes perhaps one of the most complicated current investment cases. On the one hand, the company is potentially a massive disrupter that could not only revolutionise transportation but change its very nature. On the other hand, the company is hugely overvalued on typical investment metrics, even by the standards of fourth industrial revolution companies. Mobility company Tesla has a market capitalisation of just more than $47bn, off a revenue of $12bn, at last count. Compare that with traditional motor company Ford, ...
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