might be asking yourself why is tesla going up today well here is exactly why sitting at one
thousand ninety one dollars per share and it'd be kind of cool if on this video today we see it
break eleven hundred dollars and here's exactly why it's going up guys it's because they just
recently announced through their sec filings that they want to do a stock split in the form
of a dividend and i'll explain exactly what that means now there is a couple things that you need
to keep in mind first of all if you are a tesla holder this doesn't mean that you're going to
get paid a dividend a lot of people are thinking oh tesla's finally going to pay a dividend so if
you're a dividend fund investor this is actually not true at all it's not actually a dividend
from the standpoint of something like oh i don't know coca-cola at t q ild something like that
that pays a monthly or quarterly dividend that is not what tesla is announcing they're announcing
a stock split with a stock dividend and i'll explain that a little bit later but if you're a
tesla holder just get ready for that because you also got to remember that it has to go through
the vote the shareholder now i don't think by any stretch of any imagination that this is going to
be an issue where it's not going to be voted through i really do think that stock splits
are typically seen as favorable so i don't think that's actually going to be a hold up the fact
that the board has already approved a stock split next up it's the shareholders i really don't think
that they're going to deny this so we'll have to keep our eyes on the news but obviously as you
can see here especially today we're seeing quite a run up so it's kind of been going up actually and
you know since march 18th we're kind of shooting up here but it's been flirting anywhere from
about 1070 earlier today to about 10 90 where we are here all the way up to the top at 10.97
i would really like it to break 1100 today but we'll have to see because there's actually a lot
of downward pressure in the entire stock market right now we have the ukraine thing going on
we have you know the inflation thing going on gas prices there's a lot of downward pressure on the
market in transparency i do have a very small very very small holding in tesla and i will probably
add to that as it goes on but let's get right down to what's actually happening right now with tesla
when it comes down to a stock split typically what they'll do is they'll announce maybe a
five to one or a 20 to one in the case of actually google and amazon right now coming up this summer
they are announcing a 20 to one stock split so for every one share you own you're going to get
20 shares but your value will remain the same so what's the difference between a stock split
and a stock dividend that tesla just announced well in the case of a stock dividend additional
shares are given to shareholders whereas in a stock split already issued shares are split
on an agreed ratio so i mentioned earlier with google and amazon a 20 to one split you own one
share of google you're going to get 20 shares of google at the same value of what you own at the
time of the split but in the case of tesla they're giving this as a payment through additional shares
to the shareholders now that could actually mean let's say you have like a thousand shares of tesla
you end up after this is all said and done with 1200 shares so it's just something to keep in mind
but ultimately if we go back to when they last did a stock split back in august of 2020 let's
take a look at what happened i'm gonna pull up weeble right now here we are at 1089 really want
to see that 1100 but uh we might not be lucky on today's video but let's go back here a little bit
and i want to go back to 2020. now they announced and did a split so all the numbers on today's
video will be as a result of the prior split but you can see a lot of upward momentum between the
period of april 2020 right here all the way up to right about here when this happened so what
is that like 8 28 it happened on 8 31 so right about here is when this stock split happened
but look what happens after that it just continues to have a lot of positive momentum and of course
2021 was a year like none other but it's really nice to see that the based on what tesla has to
bring to the table this continued an upward trend now i gotta say i've done some really dumb things
in my life and here i'm gonna be transparent with you guys because i know you appreciate that here's
something i did that i'm not too happy with back around this time so let's go over here it's okay
right here september 4th 2020. it's going for at the top 500 at the low 380. now even at 380
back on september 4th i'm thinking i don't know that seems kind of high that seems a little bit
expensive and i'm looking at this and if you look at the chart if we chop off the half here to the
right and we only look at the left-hand side you can see it's kind of like really kind of gone
up there and you know a lot of times i think what we do as investors is we look here and we're like
yeah you know i think it's kind of at a high and it's probably due for a significant pullback or
recession or something like that we immediately go into this negative mindset right instead of
looking at the fundamentals and that's where i failed instead of looking at the fundamentals
behind the curtain or under the hood of tesla i decided to say you know what this seems a little
bit expensive now if i would have just said you know what even though it's expensive i'm going
to buy it anyway and i bought a couple shares at 380 you can obviously see where i'd be today
1091 or even before this whole surge came up let's go back here to the end of 2020 at 582.
so i would have gone from 380 a share to 582 which means let's get to the point of show me the money
and in this segment of tesla we're going to look at the money aka the fundamentals behind tesla to
see if this is actually a buy or something to avoid i'm just going to go over here to
seekingalpha.com because it's free and i'm making it easy for you guys to look at the fundamentals
so i'm going to type in tesla t-s-l-a we're going to click on that and we're going to go through
the smart steps and i'm going to take you through exactly what i look at here
first thing i look at is the p e ratio p e ratio right now as of seekingalpha.com sitting at 94.78
now if you are looking for something that's value for the long long term you got to be
careful of something that's overvalued but i'll say you know i look for 15 to 16 pe
however with everything that's going on with tesla and the potential growth mechanisms within tesla
i'm going to say that even though 94 could actually be a red mark on the p e ratio i'm going
to give it a yellow and the reason i'm giving it a yellow is just because of the fact that there's
i think a lot of other great things that when it comes down to tesla that we need to keep in mind
and a lot of it is its upcoming growth in the electric vehicle sector so more on that in just
a moment the next thing i want to look at is the revenue growth because if they're not growing the
revenue they might be uh having some issues is it going to be yellow is it going to be red all you
have to do right here on seeking alpha is right here at the top go to financials click on that
and then right now of course you can upgrade to get all the additional data what i'm going
to look at right now is just the difference between what they give me so we have 2017
to 2021 are we seeing growth holy crap are we ever we are seeing and these figures are
in the millions look at this we're going from 11.7 billion dollars all the way up to 53.8
that is a significant amount of growth and that means that revenue from a tesla perspective is a
green light i love the fact that we're seeing some significant growth revenue looking really nice and
sexy next up let's talk about profit margin of tesla because you got to think about like you can
get as much revenue in the world as you want but if you don't have good profit if your margin isn't
good i get a little bit worried now when companies are first starting off of course they could be
negative on this but the goal would be how is your deliverables how is your growth and everything
in between but right now for tesla since they've been in the game for a while i do want to see some
positivity on that profit margin 10 or more is always a good thing so how you figure out profit
margin in case you're not aware is you take the net income of the company and then you divide that
by the total revenue so i'm going to say total rev okay and we can find that again on seeking
alpha let's go to the net income right here we're still in the financial income statement
we come down here to net income let's look at the very last statement so we have five
five one nine and we're going to divide that by total revenue of 53
823 which is actually 53 billion 823 million so i'm going to take out my calculator and
do five five one nine divided by five three eight two three that gives me a total of a ten point
two percent profit margin which means profit is also in the green so this is looking very
good so far let's move on to the next step i like to look at their debt load so this is basically
their assets versus their liabilities if they totally get rid of all of their assets all of
the liabilities what does that look like now what i want to do for this one you can always
find this of course in seeking alpha but i want to talk a little bit about weeble weibo right now is
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description below and then once you do you can get your very own weibo account and within your weibo
account you can then do a little bit of this own research so if i wanted to see their debt versus
liabilities in this particular example here's what we want to do so within weibo all i have
to do is pull up this screen right here go over to the company tab right there at the top you see
that click on that and then right here at the very bottom click on financial details you can do a lot
of the research that we're doing here in today's video on the fundamentals on the show me the money
right here on weeble so what i want to do is come down here to the balance sheet now look at this
right here you can see their total assets their total liability and their debt to asset ratio
and this is exactly what we're looking for in this particular analysis so if we looked at fiscal year
2021 they had 62.13 billion of assets and 30.55 billion of debt or liabilities which means that if
they sold everything they would still be positive on their overall balance sheet that is great
that's what we want to see and guess what that does that gives them yet another green light right
here under the debt that is great news that's what we want to see last thing let's look at the eps
now that's earnings per share so if we look right here on the weave i'm going to use this again
actual versus estimate you can see that estimate is that slight gray line and we're tracking all
the way back quarter one 20 21 all the way forward to quarter one 20 22 which is not yet announced
however look at the blue line on the earnings per share it's actually exceeding the estimates
another great great option so we're going to go ahead and also say that that is a green mark now
i will tell you tesla could be considered a little bit overvalued based on the p e ratio right here
however there's a lot of things you also got to look at is the growth of this particular company
there's a lot of good things going on with it so what i would recommend doing is keeping your
eye on the news keeping an eye on their statements are they continuing to exceed their revenue exceed
their profit keep their debt in line and keep their earnings per share what we don't want to see
is their balance sheet get out of whack as they continue to expand is there a potential where
they're taking on too much debt which then you need to as a smart investor try to figure out
what they're doing and what they're spending all their capital on is that what i feel good
about when it comes down to what they're going to produce in the future and that's kind of the key
point so there's obviously more to it than just the stock split i hope this was helpful if it was
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