Big run in Tesla a warning for dull Singapore market

As investors gravitate towards world's biggest and best performing stocks, local companies must demonstrate new relevance

Ben Paul

Published Sun, Feb 16, 2020 · 09:50 PM

tesla

AFTER hearing about all the money that some of my friends have made recently from trading shares in Tesla, I decided to listen to the company's Q42019 earnings call to see what all the fuss was about.

On the face of it, the electric vehicle maker really appears to have hit its stride. After reporting more than US$1.1 billion in losses for the first two quarters of 2019, Tesla unexpectedly turned profitable in Q32019 with earnings of US$143 million, on cost cutting and strong deliveries of its electric vehicles. The momentum continued into Q42019, with the company reporting US$105 million in earnings for Q42019, and more than US$1 billion in free cash flow.

Tesla's CEO Elon Musk bragged during the earnings call that the strong sales in Q42019 were achieved with zero advertising spending, and that the company will be able to sell as many vehicles as it can make for years to come. Tesla delivered approximately 367,500 vehicles in 2019, or some 50 per cent more than the previous year. The company says its vehicle deliveries in 2020 should "comfortably exceed" 500,000 units, which repre…