'Fundamentals' and all that is a bs excuse used to scapegoat driving stocks they or their friends don't like to the ground.
Let me ask this.
How in the world can an 'analyst' know more about tech than the people that work all their lives in bleeding edge research and technology?
They don't. They don't know more than Jim Keller whose primary task was development of Zen architecture at AMD - which traded at $5 before he joined and until after he was done.
Why do I mention Jim Keller? Because a certain class of people can not only turn around a company, but whole industries even if only due to being famous and drawing unknown talents.
In the case of TSLA; Andrej Karpathy leads the AI division.
My argument is that 'analysts' know nothing of tech and they are in no position to act as the judges.
People who know tech often don't know how to find their way out of a paper bag. Business is a fundamentally social thing. People who want to understand tech businesses must understand both tech and business; neither alone is sufficient.
Many analysts do. Some don't. They all tend to cover several names, and each name has some analysts who are more influential than others. The influential ones aren't exclusively found at prestigious investment banks, either. One of the most influential analysts for AAPL, Dan Ives, works at Wedbush.
Technology experts are often clueless to a fault and don't have some kind of "third eye" for business, any more than business experts have a "third eye" for technology.
It's also a mistake to think that just because a person is familiar with one technology, he/she understands the demand for that technology -- let alone other, weakly related technologies.
> 'Fundamentals' and all that is a bs excuse used to scapegoat driving stocks they or their friends don't like to the ground.
I agree with this in the case of GME and AMC, but in other situations fundamental analysis can help a person to understand valuations. It seems like BS until you actually find yourself carrying risk and trying to figure out how much a stock should be worth.
Fundamentals shouldn't play much of a role for valuing companies that are at risk of default or bankruptcy, because the stock prices the long-term EV of a binary outcome: either the equity value approaches zero or it doesn't. People who think they know what GME stock is worth, but haven't sold any shares short, are just pontificating and they should either put their money where their mouths are or sit on the sidelines and watch with fascination like the rest of us.
“Our goal is, and I feel pretty good about this goal, that we’ll be able to do a demonstration drive of full autonomy all the way from LA to New York, from home in LA to let’s say dropping you off in Time Square in New York, and then having the car go park itself, by the end of next year,” [Musk] said on a press call [in October 2016]. “Without the need for a single touch, including the charger.”
How much did you need to know about tech to realize that wasn't going to happen?
Consider the following, everyone claimed reusing rockets was physically impossible. Well here we are now.
Sure 'end of next year' may be impossible, but doing it at some point is not necessarily impossible given certain conditions.
Nothing to do with targets, everything to do with values. And a company is more than what it produces, it is also the patents they own and the brains they wield.
A valuation of 20 times revenue - and thousands of times earnings - is not justified by saying "a company is more than what it produces".
Edit: put otherwise, how does your comment relate to the fact that Tesla was trading at 5-10% of the current price in 2019? Aren't the patents and brains the same? Why are Tesla's patents and brains worth now almost as much as those of Apple or Microsoft?
I don't know anyone who claimed that reusing rockets was physically impossible. The Space Shuttle SRBs were reusable. To paraphrase you, "here we were then."
"At an altitude of approximately 45 km (24 nautical miles), the boosters separate from the orbiter/external tank, descend on parachutes, and land in the Atlantic Ocean. ... They are recovered by ships, returned to land, and refurbished for reuse."
Those analysts are incredibly specialised. The rank and file developer ‘at the bleeding edge’ spends their day buried deep in a single codebase. The analyst spends their day carefully picking through industry trends.
You say short sellers are using fundamentals as an ‘excuse’ to short stocks ‘they don’t like’. If not from careful analysis of the business, where should the opinions come from?
How about potential and understanding of underlying tech?
Nvidia was an obvious play in 2013 with the precursor of AlexNet, AMD was an obvious play when Jim Keller was done.
I don't think Nvidia was a particularly obvious play at the time. GPU bitcoin mining had taken off and GPUs were in high demand, but I don't think many people realised GPU compute would take off the way it did: everyone I knew in ML was still using clusters and most of them were using Matlab.
Even if you took it for granted that GPU-powered deep learning was the next big thing, it wasn't obvious that NVIDIA would be the dominant player. CUDA made GPGPU programming easy at the time, but any other manufacturer could have released something better. It just didn't play out that way.
Alexnet was 2012 by the way. Shortly after Nvidia stock tanked!
Let me ask this.
How in the world can an 'analyst' know more about tech than the people that work all their lives in bleeding edge research and technology?
They don't. They don't know more than Jim Keller whose primary task was development of Zen architecture at AMD - which traded at $5 before he joined and until after he was done.
Why do I mention Jim Keller? Because a certain class of people can not only turn around a company, but whole industries even if only due to being famous and drawing unknown talents.
In the case of TSLA; Andrej Karpathy leads the AI division.
My argument is that 'analysts' know nothing of tech and they are in no position to act as the judges.