Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
Settings
Settings
Dynamic quotes 
OFFON

MarketScreener Homepage  >  Equities  >  Nasdaq  >  Tesla    TSLA

TESLA

(TSLA)
  Report  
SummaryQuotesChartsNewsRatingsCalendarCompanyFinancialsConsensusRevisions 
News SummaryMost relevantAll newsOfficial PublicationsSector newsMarketScreener StrategiesAnalyst Recommendations

Tesla : To go private or not to go private...

share with twitter share with LinkedIn share with facebook
share via e-mail
0
08/09/2018 | 09:55am EDT

That is the question after Elon Musk tweeted earlier this week that he wanted to take Tesla private at $420, declaring that financing was secured. The Tesla founder said that as a private company, it would be able to focus on the business rather than quarterly earnings.

Is going private the right move for Tesla ? Nobody knows for sure, but we can always look at a few well-known companies that did it in the past...

One of the most well-known delisting is certainly Dell, who decided to go private in 2013 in a $24.4 billion transaction. However, things didn't go as well as expected: while the company increased revenue growth, it is still losing money. In particular, Dell suffered from the shift from laptops to tablets and other mobile devices. In July, the PC maker announced  that it is planning to go public again.

In 2010, 3G Capital took Burger King private, constructing an IPO with Pershing Square Capital lead by Bill Ackman. But, in 2012, the company went public again.

Heinz, the world-leader of the packaged food industry, was delisted from NYSE in June 2013. It was acquired for more than $28 billion by an investment consortium comprising of Berkshire Hathaway. In 2015, Kraft Foods Group announced a merger deal with H.J. Heinz financed in part by Warren Buffett, which took the company back to the stock market.

Hilton, the leading global hospitality and hotel chain, was bought by Blackstone Group in 2007 for $26 billion, and was eventually delisted from the NYSE. It allowed the compay to renegotiate its debt, and expand internationally. However, the company went public again in 2013.

As you can see in these examples, they all eventually came back. Yes, privatization offers many benefits : it is freeing up management's time and effort to concentrate on running and growing a business as there is much fewer regulation to comply with, and no quarterly earnings or short sellers to deal with. But it can also mean being under strong pressure from the new private owners, who might set tough targets and tight deadlines.

However, it might be the right move right now for a company like Tesla, which is taking a long view and is driven by the idea to shape the future of mobility. "As a public company, we are subject to wild swings in our stock price that can be a major distraction for everyone working at Tesla," Elon Musk wrote in a memo to Tesla employees. "Being public also subjects us to the quarterly earnings cycle that puts enormous pressure on Tesla to make decisions that may be right for a given quarter, but not necessarily right for the long-term."

And who knows, it may come back to the market in an even better shape in a few years time ...
Stocks mentioned in the article
ChangeLast1st jan.
DELL TECHNOLOGIES 0.00%End-of-day quote.0.00%
HILTON WORLDWIDE HOLDINGS INC -0.10% 92.02 Delayed Quote.28.29%
TESLA -6.02% 192.73 Delayed Quote.-38.38%
THE KRAFT HEINZ COMPANY -0.31% 31.88 Delayed Quote.-25.70%

Romain Fournier
© MarketScreener.com 2018
share with twitter share with LinkedIn share with facebook
share via e-mail
0
Latest news on TESLA
02:54pCONSUMER REPORTS : Tesla automated lane changes are risky
AQ
12:36pTESLA : Future of Driverless Deliveries Depends on Large Auto Makers
DJ
12:07pTESLA : A Brief Look at Some of the Best Trending Business Models Worldwide
AQ
01:12aTESLA : What the other papers say this morning
AQ
05/21TESLA : Statement of changes in beneficial ownership of securities
PU
05/21TESLA : Business Highlights
AQ
05/21TESLA : Former Tesla bull makes $10 worst case call on China worries
RE
05/21TESLA : stock worth just $10 in worst case - Morgan Stanley
AQ
05/21TESLA : stock worth just $10 in worst case - Morgan Stanley
AQ
05/21TESLA : reduces prices on Models S and X amid stock slump
AQ
More news
Financials ($)
Sales 2019 24 891 M
EBIT 2019 214 M
Net income 2019 -709 M
Debt 2019 8 225 M
Yield 2019 -
P/E ratio 2019 -
P/E ratio 2020 82,22
EV / Sales 2019 1,79x
EV / Sales 2020 1,42x
Capitalization 36 301 M
Chart TESLA
Duration : Period :
Tesla Technical Analysis Chart | MarketScreener
Full-screen chart
Technical analysis trends TESLA
Short TermMid-TermLong Term
TrendsBearishBearishBearish
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus HOLD
Number of Analysts 30
Average target price 280 $
Spread / Average Target 36%
EPS Revisions
Managers
NameTitle
Elon Reeve Musk Chief Executive Officer
Robyn M. Denholm Chairman
Deepak Ahuja Chief Financial Officer
Jeffrey B. Straubel Chief Technology Officer
Gary Clark Chief Information Officer
Sector and Competitors
1st jan.Capitalization (M$)
TESLA-38.38%36 301
TOYOTA MOTOR CORP5.08%192 764
VOLKSWAGEN4.16%81 501
DAIMLER AG13.53%62 070
GENERAL MOTORS CORPORATION11.00%52 438
BAYERISCHE MOTOREN WERKE AG-8.59%47 054