An Ode to Luck: Revisiting my Tesla Valuation

The author revisits his Tesla valuation from June 2019 ($190/share) in light of the stock's dramatic rise to $581 by January 2020, updating key assumptions around revenue growth, operating margins, and cost of capital. He acknowledges that his investment timing was driven by luck rather than skill, and uses Monte Carlo simulation to assess whether Tesla's current market price of $650 is justified by fundamental value, concluding it is neither plausible nor probable based on his assumptions. Despite a calculated intrinsic value of $427/share, the author sold his position at $640 to avoid the trading game and realize tax gains, demonstrating the distinction between value investing and momentum trading.