Isla Stock is running out of road?

During the last decade, some investors have made a batch of money ownership actions in Tesla (Nasdaq: Tsla). Only in the last five years, Tesla shares have increased by 567%, which means that it now has a market capitalization of $ 1.1TRN.

However, Tesla's actions have collapsed in a room since mid -December. Could this be a sign that the investment case is becoming less attractive, or a possible opposite purchase opportunity for my portfolio?

Commercial yield and perspectives generate actions prices

Actions often move and that is generally reduced to one of two things: impulse and fundamentals.

The impulse is when an action moves because many people buy or sell it, even if the commercial performance has not changed in a way that deserves a new assessment.

That can have a great effect on actions prices, sometimes for years. Tesla's actions have certainly seen a lot of impulse in recent years, and some speculators accumulate just because they hope it will continue to rise, instead of why they saw participation as a good value for what they paid.

The impulse can work both ways, of course, and I think we have seen some of that lately. In any case, I am an investor, not a speculator, and the impulse does not seem to me a solid base for long -term investment.

Rather, I prefer to buy (or sell) depending on what are called foundations, how well it is expected to do a business in financial terms.

Tesla is a big business proven

Given the recent drop in the price of shares, it may be difficult to forget that Tesla is a really excellent and successful business.

He has been a pioneer of the mass market in electric vehicles (EV) and has a strong market share. He has developed an integrated manufacturing and sales operation that has helped it expand sales quickly. The company now sells thousands of vehicles every day worldwide.

The experience that Tesla has developed in the batteries is helping to increase its already considerable energy generation business. Meanwhile, a large customer base, a strong brand and a patented technology could help you continue to work well in the EV business.

Unlike many sector manufacturers, Tesla is already solidly profitable. However, their sales of vehicles fell slightly last year.

Combined with the growing rivalry in that space, I see the risk that income can decrease and profit margins can also be eroded due to greater price competition.

However, if I could buy Tesla shares at the right price, I would.

So are the Tesla participants overvalue after the fall? There is the rubbing … despite the recent clash of the price of shares, the action is still sold in a price / profits ratio of 175.

That seems far Too expensive for me, even if to ignore the perspective that the price competition and the reduction of tax reimbursements could lead to Tesla's profits falling in the coming years.

As an investor, it is not a speculator, I will not touch Tesla's shares at its current price.