Company ana

Tesla

pany analysis & DCF Valuation

ation

Performed by Ihor Medvid, an aspiring financier

Drivers

Selected case 2
Company Tesla
Currency USD
Domestic country United States
10-year treasury yield (Mar 29 2019) 2.44%
Market risk premium US 5%
Company beta (Mar 29 2019) 0.05
Tesla share price (Mar 29 2019) 279.86
Bond Yield (Mar 29 2019) 8.05%
Corporate tax rate 30%
Expected inflation 2.0%

Note:
1- best case scenario
2- base case scenario
3 - worst case scenario

1. Driver sheet
2. Input data (P&L and BS)

Forecasting expected deliveries + comparing

Estimating average selling price
Automotive revenue
GP peer comparison
GP % calculation
Calculating automotive COGS

Forecasting energy revenue

Calculating GP % and COGS

Forecasting Opex
Building Capex roll forward + comparing
Calculating DSO,DIO,DPO
Producing and filling Clean P&L output sheet (P&L)
Calculating investments in working capital
Forecasting UFCF (CF)
Building balance sheet + forecasting other A and L (BS)
Completing UFCF
Modeling Financial needs (Financing)
Calculating Net Income (P&L)
Bridging UFCF to Net CF
Balaning the BS
Estimating WACC
Performing DCF Valuation
Calculating EV, conducting sensitivity analysis
Building charts
Output
P&L

Tesla P
2014 2015 2016 2017 2018 2019
($ in million) Act Act Act Act Act Fcst
Revenues 3,198 4,046 7,000 11,759 21,461 23,282
Cost of sales (2,317) (3,123) (5,401) (9,536) (17,419) (19,711)
Gross profit 882 924 1,599 2,222 4,042 3,570
Operating expenses (1,068) (1,640) (2,267) (3,855) (4,430) (2,908)
EBIT (187) (717) (667) (1,632) (388) 662
Interest expenses/income (98) (159) (79) (577) (617) (757)
EBT (285) (876) (746) (2,209) (1,005) (95)
Taxes (9) (13) (27) (32) (58) -
Minority interest - - 98 279 (86) -
Net Income (294) (889) (675) (1,961) (1,149) (95)
 Tesla P&L (in mln $)
2020 2021 2022 2023 2024 2025 2026 2027 2028
Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst
34,077 48,354 63,435 75,191 80,784 85,246 88,636 91,516 93,581
(28,821) (40,498) (52,857) (62,444) (67,057) (70,712) (73,503) (75,878) (77,595)
5,256 7,856 10,578 12,747 13,727 14,534 15,133 15,639 15,986
(4,257) (6,040) (7,924) (9,393) (10,091) (10,649) (11,072) (11,432) (11,690)
999 1,815 2,654 3,355 3,635 3,885 4,061 4,207 4,296
(757) (757) (757) (757) (757) (757) (606) (412) (408)
242 1,058 1,897 2,598 2,878 3,128 3,455 3,794 3,888
(73) (318) (569) (779) (864) (938) (1,036) (1,138) (1,167)
- - - - - - - - -
170 741 1,328 1,818 2,015 2,190 2,418 2,656 2,722
 Notes:
2029
Fcst
95,701
(79,359)
16,342
(11,955)
4,387
(386)
4,001
(1,200)
- *we assume that the minority interest will be equal to zero as they have a relatively small weight on P&L
2,801
vely small weight on P&L
Balance Sheet *note that in the BS output sheet we don't have a division of current and non-current as

T
31Dec2014 31Dec2015 31Dec2016 31Dec2017 31 Dec2018 31Dec2019
($ in million) Act Act Act Act Act Fcst
Cash 1,906 1,197 3,393 3,368 3,686 6,303
Restricted cash and securities 18 23 106 155 193 193
Trade receivables 227 169 499 515 949 1,266
Inventory 954 1,278 2,067 2,264 3,113 6,386
Prepaid expenses 76 116 194 268 366 559
as a % of revenues 2.4% 2.9% 2.8% 2.3% 1.7% 2.4%
Operating lease vehicles 767 1,791 3,134 4,117 2,090 2,090
Solar energy systems leased - - 5,920 6,347 6,271 6,271
PP&E 1,829 3,403 5,983 10,028 11,330 15,862
Intangible assets - 13 376 362 351 351
Other assets 55 78 991 1,232 1,391 2,415
as a % of revenues 1.7% 1.9% 14.2% 10.5% 6.5% 10.4%
Total assets 5,831 8,068 22,664 28,655 29,740 41,695

Accounts payable 778 916 1,860 2,390 3,404 5,597

Accrued liabilities 269 423 1,210 1,731 2,094 2,823
as a % of revenues 8.4% 10.4% 17.3% 14.7% 9.8% 12.1%
Deferred revenue 192 424 763 1,015 630 1,813
as a % of revenues 6.0% 10.5% 10.9% 8.6% 2.9% 7.8%
Resale value guarantees - 137 180 787 503 698
as a % of revenues 0.0% 3.4% 2.6% 6.7% 2.3% 3.0%
Customer deposits 258 283 664 854 793 1,653
as a % of revenues 8.1% 7.0% 9.5% 7.3% 3.7% 7.1%
Long-term debt 2,430 2,649 7,010 10,312 11,971 11,971
Other liabilities 993 2,152 5,439 6,330 4,030 10,921
as a % of revenues 31.0% 53.2% 77.7% 53.8% 18.8% 46.9%
Total liabilities 4,919 6,984 17,126 23,421 23,426 35,477
Equity 912 1,084 5,538 5,235 6,314 6,219

Total liabilities & equity 5,831 8,068 22,664 28,655 29,740 41,695

!CHECK! - - - - - -
current and non-current assets ---> items like other assets/liabilities get summed

Tesla BS (in mln $)

31Dec2020 31Dec2021 31Dec2022 31Dec2023 31Dec2024 31Dec2025 31Dec2026 31Dec2027
Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst
7,657 12,086 13,554 16,762 16,644 8,631 (1,431) (1,963)
193 193 193 193 193 193 193 193
1,854 2,630 3,450 4,090 4,394 4,637 4,821 4,978
9,337 13,120 17,123 20,229 21,724 22,908 23,812 24,581
818 1,161 1,523 1,805 1,939 2,046 2,128 2,197
2.4% 2.4% 2.4% 2.4% 2.4% 2.4% 2.4% 2.4%
2,090 2,090 2,090 2,090 2,090 2,090 2,090 2,090
6,271 6,271 6,271 6,271 6,271 6,271 6,271 6,271
20,651 24,877 28,713 33,029 37,873 42,238 46,942 51,117
351 351 351 351 351 351 351 351
3,535 5,016 6,580 7,799 8,380 8,842 9,194 9,493
10.4% 10.4% 10.4% 10.4% 10.4% 10.4% 10.4% 10.4%
52,755 67,794 79,848 92,618 99,859 98,206 94,370 99,307

8,184 11,499 15,009 17,731 19,041 20,078 20,871 21,545

4,132 5,863 7,691 9,117 9,795 10,336 10,747 11,096
12.1% 12.1% 12.1% 12.1% 12.1% 12.1% 12.1% 12.1%
2,654 3,766 4,941 5,856 6,292 6,639 6,904 7,128
7.8% 7.8% 7.8% 7.8% 7.8% 7.8% 7.8% 7.8%
1,021 1,449 1,901 2,253 2,421 2,555 2,656 2,743
3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0%
2,419 3,433 4,503 5,338 5,735 6,052 6,292 6,497
7.1% 7.1% 7.1% 7.1% 7.1% 7.1% 7.1% 7.1%
11,971 11,971 11,971 11,971 11,971 10,100 7,691 7,630
15,985 22,683 25,374 30,076 32,314 29,836 26,591 27,455
46.9% 46.9% 40.0% 40.0% 40.0% 35.0% 30.0% 30.0%
46,367 60,665 71,391 82,343 87,569 85,597 81,752 84,094
6,388 7,129 8,457 10,275 12,290 12,609 12,618 15,213

52,755 67,794 79,848 92,618 99,859 98,206 94,370 99,307

- - - - - - - -
31Dec2028 31Dec2029 Assumptions
Fcst Fcst :
(3,302) (2,588) CF Sheet. --> Cash = Cash from previous year + net cash
193 193 Stays flat
5,090 5,205 Working capital sheet
25,138 25,709 Working capital sheet
2,247 2,297 Grows as a % of revenues
2.4% 2.4%
2,090 2,090 Stays flat *not company's core business
6,271 6,271 Stays flat *not company's core business
55,445 58,348 PP&E sheet
351 351 Stays flat
9,707 9,927 Grows as a % of revenues
10.4% 10.4%
103,229 107,803

22,033 22,534 Working capital sheet

11,347 11,604 Grows as a % of revenues
12.1% 12.1%
7,289 7,454 Grows as a % of revenues
7.8% 7.8%
2,805 2,868 Grows as a % of revenues
3.0% 3.0%
6,644 6,794 Grows as a % of revenues
7.1% 7.1%
7,367 7,367 Previous year + Financing sheet
28,074 28,710 Grows as a % of revenues
30.0% 30.0%
85,558 87,331
17,671 20,472 *Ending equity=Opening equity +/- Net income +/- other equity movements

103,229 107,803

- -
Cash Flow

2014 2015 2016 2017 2018

($ in million) Act Act Act Act Act
EBIT (717) (667) (1,632) (388)
Operating taxes (30%) (13) (27) (32) (58)
NOPAT (730) (694) (1,664) (446)
Add-back D&A 423 947 1,166 1,901
Gross Cash Flow (307) 253 (497) 1,455
Trade receivables 58 (330) (16) (434)
Inventory (324) (790) (196) (850)
Accounts payable 138 944 530 1,014
Investments in Working Capital (128) (176) 318 (269)
Capex (1,997) (3,527) (5,211) (3,204)
Other assets (1,105) (8,700) (1,760) 1,820
Other liabilties 1,708 4,836 2,463 (2,668)
Unlevered Free Cash Flow (1,830) (7,313) (4,687) (2,866)
Interest expenses (159) (79) (577) (617)
Delta Financial liabilities 219 4,361 3,302 1,659
Delta equity/Other equity movements 1,061 5,129 1,658 2,228
Tax adjustment - - - -
Minority interest - 98 279 (86)
Net Cash Flow (709) 2,196 (25) 318

Opening cash 1,905.7 1,196.9 3,393.2 3,367.9

Net Cash Flow - (708.8) 2,196.3 (25.3) 317.7
Closing cash 1,905.7 1,196.9 3,393.2 3,367.9 3,685.6

Check - - - - -
 Tesla Cash Flow (in mln $)
2019 2020 2021 2022 2023 2024 2025 2026 2027
Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst
662 999 1,815 2,654 3,355 3,635 3,885 4,061 4,207
(199) (300) (545) (796) (1,006) (1,091) (1,166) (1,218) (1,262)
463 699 1,271 1,858 2,348 2,545 2,720 2,843 2,945
1,133 1,556 1,969 2,384 2,862 3,413 3,968 4,588 5,214
1,596 2,255 3,240 4,241 5,210 5,957 6,688 7,430 8,158
(317) (587) (777) (820) (639) (304) (243) (184) (157)
(3,272) (2,951) (3,783) (4,004) (3,106) (1,495) (1,184) (904) (769)
2,193 2,587 3,316 3,509 2,722 1,310 1,038 792 674
(1,397) (952) (1,244) (1,315) (1,023) (489) (389) (296) (252)
(5,665) (6,345) (6,195) (6,219) (7,178) (8,257) (8,332) (9,292) (9,388)
(1,217) (1,379) (1,824) (1,926) (1,502) (714) (570) (433) (368)
9,858 8,304 10,982 7,217 8,230 3,916 (1,139) (2,228) 1,728
3,176 1,884 4,959 1,998 3,738 413 (3,742) (4,819) (121)
(757) (757) (757) (757) (757) (757) (757) (606) (412)
- - - - - - (1,871) (2,409) (61)
0 0 - - - - (1,871) (2,409) (61)
199 227 227 227 227 227 227 182 124
- - - - - - - - -
2,617 1,354 4,429 1,468 3,208 (117) (8,014) (10,062) (531)

3,685.6 6,302.8 7,656.6 12,085.8 13,553.7 16,761.6 16,644.5 8,630.5 (1,431.4)

2,617.2 1,353.8 4,429.1 1,467.9 3,207.9 (117.1) (8,014.0) (10,061.9) (531.5)
6,302.8 7,656.6 12,085.8 13,553.7 16,761.6 16,644.5 8,630.5 (1,431.4) (1,962.9)

- - - - - - - (0) (0)
 2028 2029
Fcst Fcst
4,296 4,387
(1,289) (1,316)
3,007 3,071
5,895 6,523 * as D&A is a non monetary expense
8,902 9,595 *delta
(112) (115) *delta
(556) (571) *delta
488 501 *delta
(181) (186) *delta
(10,223) (9,426) *PP&E sheet
(264) (271) *sum of deltas
1,239 1,272 *sum of deltas
(527) 984 * actual cash inflow and outflow that reflects company's capital structure (debt & equity movements)
(408) (386) * Financing sheet
(263) - * BS Sheet
(263) - * Delta equity = ending equity - beginning equity - net icnome
122 116 * taxes (P&L) - operating taxes (CF)
- - * P&L sheet
(1,339) 714

(1,962.9) (3,301.9)
(1,339.0) 714.0
(3,301.9) (2,587.9)

(0) (0)
equity movements)
DCF Valuation

g (Perpetuity growth) 2.0%

WACC (average) 4% 1.0
2014 2015 2016 2017 2018 2019
Act Act Act Act Act Fcst
($ in million)
Unlevered Free Cash Flow 3,176
Continuing value

Discount factor (WACC) 4.6%

Present value of UFCF 3,035
Present value of CV

DCF Valuation results ($ in millions except price per share)

Total PV of Cash Flows 7,257
Continuing Value 68,338
PV of Continuing Value 46,961
Enterprise Value 54,218
+Cash 3,686
-Financial liabilities (11,971)
Equity Value 45,932
Number of shares outstanding (as of 29 Mar 2018) 173
Price per share 265.96
 2.0 3.0 4.0 5.0 6.0 7.0 8.0 9.0 10.0
2020 2021 2022 2023 2024 2025 2026 2027 2028
Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst

1,884 4,959 1,998 3,738 413 (3,742) (4,819) (121) (527)

4.6% 4.5% 4.4% 4.3% 4.1% 4.0% 3.8% 3.7% 3.6%

1,721 4,341 1,681 3,032 324 (2,844) (3,574) (88) (371)

Sensitivity analysis (Tesla's EV)

WACC
54,217.7 1% 2% 3% 4% 5.0
1%
g 2%
3%
 11.0 ---> *how far from the present moment we are
2029
Fcst

984
68,338

3.5%
676
46,961

Notes:

WACC = (D/(D+E)) *Kd*(1-t)+ (E/(D+E))*Ke

Continuing value (terminal value) = UFCF 10.5 (1+g)/(WACC - g)

Stages:
1. Set the Perpetuity growth rate
2. Link the UFCF from CF sheet
3. Link the WACC
4. Calculate continuing value

IMPORTANT:
Unlevered free cash flow --> WACC (Whenever we deal with CF available to both debt and equity holders)
Net cash flow --> Cost of equity (If interest expenses were already paid)

* Perpetuity growth of 2% or 3% is used by most practitioners. "g"compensates for infliation and align the company's growth with
he company's growth with the GDP of the economy in which it operates
Сharts
Profitability margins

Tesla P&L (in mln $)

2014 2015 2016 2017 2018 2019 2020
($ in million) Act Act Act Act Act Fcst Fcst
Revenues 3,198 4,046 7,000 11,759 21,461 23,282 34,077
GP % 27.6% 22.8% 22.8% 18.9% 18.8% 15.3% 15.4%
EBIT % -8.9% -21.6% -10.7% -18.8% -4.7% -0.4% 0.7%
Gross profit 882 924 1,599 2,222 4,042 3,570 5,256
EBIT (285) (876) (746) (2,209) (1,005) (95) 242

Tesla Profitability Margi

120,000

100,000 27.6%
22.8% 22.8%
18.9% 18.8%
80,000 15.3% 15.4% 16.2% 16
$ i n mi l l i on

60,000 3
0.7% 2.2%
-0.4%
40,000 -4.7%
-8.9% -10.7%
20,000 -18.8%
-21.6%
-
2014 2015 2016 2017 2018 2019 2020 2021 2
Act Act Act Act Act Fcst Fcst Fcst F

($ i n mi l l i on) Revenues
 2021 2022 2023 2024 2025 2026 2027 2028
Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst
48,354 63,435 75,191 80,784 85,246 88,636 91,516 93,581
16.2% 16.7% 17.0% 17.0% 17.0% 17.1% 17.1% 17%
2.2% 3.0% 3.5% 3.6% 3.7% 3.9% 4.1% 4%
7,856 10,578 12,747 13,727 14,534 15,133 15,639 15,986
1,058 1,897 2,598 2,878 3,128 3,455 3,794 3,888

Tesla Profitability Margins

40.0%

30.0%

20.0%
3% 15.4% 16.2% 16.7% 17.0% 17.0% 17.0% 17.1% 17.1% 17.1% 17.1%
10.0%
2.2% 3.0% 3.5% 3.6% 3.7% 3.9% 4.1% 4.2% 4.2%
% 0.7% 0.0%

-10.0%

-20.0%

-30.0%
19 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029
t Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst

mi l l i on) Revenues GP % EBIT %

 2029
Fcst
95,701
17%
4%
16,342
4,001
Revenue bridge
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Revenue 2019 19,864

Tesla Model 3 4,368
Tesla Model S and X 178
Tesla Model Y 88
Tesla Roadster 2 115
Tesla Pickup 1,350
Tesla Semi 4,286
Revenue 2020 30,249

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Revenue 2020 30,249

Tesla Model 3 1,529
Tesla Model S and X 181
Tesla Model Y 7,561
Tesla Roadster 2 115
Tesla Pickup 683
Tesla Semi 3,902
Revenue 2021 44,220
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ferent file format will permanently break the chart.

Tesla CF Bridge

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Net CF 2019 2,617

NOPAT 236
D&A 423
Working Capital 445
Capex (680)
Other (1,717)
Net CF 2020 1,354

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Net CF 2020 1,354
NOPAT 571 Editing this shape or saving this workbook into a different file form
D&A 413
Working Capital (292)
Capex 150
Other 2,234
Net CF 2021 4,429
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Net Income bridge

Net Inc. FY18 (1,149) This chart isn't available in your version of Exce
Δ Revenues 1,820
Δ Cost ofsales (2,292) Editing this shape or saving this workbook into
Δ Operating expenses 1,522
Δ Interest expenses (140)
Δ Taxes 58
Δ Minority interest 86
Net Inc. FY19 (95)
Δ Revenues 10,795
Δ Cost ofsales (9,109)
Δ Operating expenses (1,348)
Δ Interest expenses -
Δ Taxes (73)
Net Inc. FY20 170
Δ Revenues 14,277
Δ Cost ofsales (11,678)
Δ Operating expenses (1,783)
Δ Interest expenses -
Δ Taxes (245)
Net Inc. FY21 741
Δ Revenues 15,081
Δ Cost ofsales (12,359)
Δ Operating expenses (1,884)
Δ Interest expenses -
Δ Taxes (252)
Net Inc. FY22 1,328
Δ Revenues 11,756
Δ Cost ofsales (9,587)
Δ Operating expenses (1,469)
Δ Interest expenses -
Δ Taxes (210)
Net Inc. FY23 1,818
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Revenue by vehicle models

Tesla Rev
2014 2015 2016 2017 2018 2019
Vehicle Act Act Act Act Act Fcst
Tesla Model 3 - - - n.a. n.a. 10,920
Tesla Model S and X 3,007 3,741 6,351 n.a. n.a. 8,878
Tesla Model Y - - - - - -
Tesla Roadster 2 - - - - - -
Tesla Pickup - - - - - 16
Tesla Semi - - - - - 50
Total 3,007 3,741 6,351 - - 19,864

Revenue from different typ

100000

90000

80000

70000 16,747
15,950
14,500
60000 3,904
3,719 438
3,381 417
$ in million

13,182 380
50000
3,073 25,578 28,136
345
40000 8,239 23,253
2,049
230 14,533
30000 4,336 7,649
1,366
115
88 9,610 9,802 9,998
9,237 9,422
20000 50
16
- 9,056
8,878
10000 18,498 19,423 20,395 20,802
15,288 16,817
10,920
0
2019 2020 2021 2022 2023 2024 2025
Fcst Fcst Fcst Fcst Fcst Fcst Fcst
 Tesla Revenue Automotive (in mln $)
2020 2021 2022 2023 2024 2025 2026 2027
Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst
15,288 16,817 18,498 19,423 20,395 20,802 21,219 21,643
9,056 9,237 9,422 9,610 9,802 9,998 10,198 10,402
88 7,649 14,533 23,253 25,578 28,136 29,542 31,019
115 230 345 380 417 438 460 469
1,366 2,049 3,073 3,381 3,719 3,904 4,100 4,182
4,336 8,239 13,182 14,500 15,950 16,747 17,585 17,936
30,249 44,220 59,053 70,546 75,860 80,026 83,104 85,652

enue from different types of vehicles, 2019-2029

18,295 18,661
17,936
17,585
16,747
15,950 4,265 4,351
4,182 479 488
4,100 469
3,904 460 Tes l a Semi Tes l a Pi cku
3,719 438
417
31,640 32,273 Tes l a Roa dster 2 Tes l a Mod
29,542 31,019
25,578 28,136
Tes l a Model S a nd X Tes l a Mod

10,198 10,402 10,610 10,822 Vehi cl e

9,802 9,998

20,395 20,802 21,219 21,643 22,076 22,517

2024 2025 2026 2027 2028 2029

Fcst Fcst Fcst Fcst Fcst Fcst
 2028 2029 Vehicle type
Fcst Fcst
22,076 22,517 Car
10,610 10,822 Car
31,640 32,273 Car
479 488 Car
4,265 4,351 Pickup
18,295 18,661 Truck
87,365 89,112

Tes l a Semi Tes l a Pi ckup

Tes l a Roa dster 2 Tes l a Model Y

Tes l a Model S a nd X Tes l a Model 3

Vehi cl e
Price-Volume-Mix Analysis
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Average price Editing this shape or saving this workbook into a differen
Average price 2017 ($ 000's) 94
Average price 2018 ($ 000's) 73
Average price 2021 ($ 000's) 60
Average price 2022 ($ 000's) 62
Average price 2027 ($ 000's) 61
Average price 2028 ($ 000's) 61

Deliveries
Deliveries 2017 103,076
Deliveries 2018 252,452
Deliveries 2021 733,654
Deliveries 2022 954,961
Deliveries 2027 1,412,677
Deliveries 2028 1,440,930
n your version of Excel. This chart isn't available in y

ng this workbook into a different file format will permanently break the chart. Editing this shape or saving t

Revenue 2017 autom. 9,641

Δ Volume 13,972
Δ Price (2,082)
Δ Mix (3,017)
Revenue 2018 autom. 18,515
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Revenue 2021 autom. 44,220

Δ Volume 13,339
Δ Price 1,148
Δ Mix 346
Revenue 2022 autom. 59,053
This chart isn't available in your version of Excel.

Editing this shape or saving this workbook into a different file format will permanently break the chart.

Revenue 2027 autom. 85,652

Δ Volume 1,713
Δ Price 0
Δ Mix 0
Revenue 2028 autom. 87,365
the chart.
Input
P&L Input

2014 2015 2016 2017

(in thousands) Act Act Act Act
Automotive revenues 3,007,012 3,740,973 6,350,766 9,641,300
Energy generation and storage 4,208 14,477 181,394 1,116,266
Services and other 187,136 290,575 467,972 1,001,185
Total revenues 3,198,356 4,046,025 7,000,132 11,758,751
Automotive cost of revenues (2,145,749) (2,823,302) (4,750,081) (7,432,704)
Energy generation and storage cost of revenues (4,005) (12,287) (178,332) (874,538)
Services and other cost of revenues (166,931) (286,933) (472,462) (1,229,022)
Gross profit 881,671 923,503 1,599,257 2,222,487
Research and development (464,700) (717,900) (834,408) (1,378,073)
Selling, general and administrative (603,660) (922,232) (1,432,189) (2,476,500)
Restructuring and other
EBIT (186,689) (716,629) (667,340) (1,632,086)
Interest income 1,126 1,508 8,530 19,686
Interest expense (100,886) (118,851) (198,810) (471,259)
Other income (expense), net 1,813 (41,652) 111,272 (125,373)
EBT (284,636) (875,624) (746,348) (2,209,032)
Provision for income taxes (9,404) (13,039) (26,698) (31,546)
Net loss incl. minority interests (294,040) (888,663) (773,046) (2,240,578)
Minority interests - - 98,132 279,178
Net loss (294,040) (888,663) (674,914) (1,961,400)

KPIs
Revenue % automotive y-o-y 24% 70% 52%
Revenue % generation y-o-y 244% 1153% 515%
Revenue % services y-o-y 55% 61% 114%
GP% automotive 29% 25% 25% 23%
GP% energy generation and automotive 5% 15% 2% 22%
GP% services and other 11% 1% -1% -23%
Overall GP% 28% 23% 23% 19%
EBIT % -6% -18% -10% -14%
Net loss % -9% -22% -10% -17%
ROA -5% -11% -3% -7%
ROE -32% -82% -14% -46%
 2018 Dec
Act
18,514,983
1,555,244
1,391,041
21,461,268
(14,173,997)
(1,364,896)
(1,880,354)
4,042,021
(1,460,370)
(2,834,491)
(135,233)
(388,073)
24,533
(663,071)
21,866
(1,004,745)
(57,837)
(1,062,582)
(86,491)
(976,091)

92%
39%
39%
23%
12%
-35%
19%
-2%
-5%
-3%
-18%
Balance Sheet Input

31 Dec 31 Dec 31 Dec

(in thousands) 2014 2015 2016
Cash and cash equivalents 1,905,713 1,196,908 3,393,216
Restricted cash and marketable securities 17,947 22,628 105,519
Accounts receivable, net 226,604 168,965 499,142
Inventory 953,675 1,277,838 2,067,454
Prepaid expenses and other current assets 76,134 115,667 194,465
Total current assets 3,180,073 2,782,006 6,259,796
Operating lease vehicles, net 766,744 1,791,403 3,134,080
Solar energy systems, leased and to be leased, net - - 5,919,880
Property, plant and equipment, net 1,829,267 3,403,334 5,982,957
Intangible assets, net - 12,816 376,145
portion - - 506,302
Restricted cash, net of current portion 11,374 31,522 268,165
Other assets 43,209 46,858 216,751
Total assets 5,830,667 8,067,939 22,664,076
Accounts payable 777,946 916,148 1,860,341
Accrued liabilities 268,883 422,798 1,210,028
Deferred revenue 191,651 423,961 763,126
Resale value guarantees - 136,831 179,504
Customer deposits 257,587 283,370 663,859
Current portion of long-term debt and capital leases 611,099 627,927 1,150,147
Total current liabilities 2,107,166 2,811,035 5,827,005
Long-term debt and capital leases, net of current portion 1,818,785 2,021,093 5,860,049
Other liabilities 993,006 2,152,107 5,438,936
Total liabilities 4,918,957 6,984,235 17,125,990
Total stockholders' equity 911,710 1,083,704 4,752,911
Noncontrolling interests in subsidiaries - - 785,175
Total liabilities and equity 5,830,667 8,067,939 22,664,076

KPIs
Liquidity ratios
Quick ratio 0.91 0.43 0.60
Current ratio 1.51 0.99 1.07
DSO 25.51 15.03 25.67
DIO 148.20 147.32 137.81
DPO 120.89 105.62 124.00
Net Trading Cycle 52.81 56.73 39.47
Solvency ratios
Debt ratio 1.19 1.16 1.32
Interest coverage <0 <0 <0
 31 Dec 30 Dec
2017 2018
3,367,914 3,685,618
155,323 192,551
515,381 949,022
2,263,537 3,113,446
268,365 365,671
6,570,520 8,306,308
4,116,604 2,089,758
6,347,490 6,271,396
10,027,522 11,330,077
361,502 350,651
516,889 421,548
441,722 398,219
273,123 571,657
28,655,372 29,739,614
2,390,250 3,404,451
1,731,366 2,094,253
1,015,253 630,292
787,333 502,840
853,919 792,601
896,549 2,567,699
7,674,670 9,992,136
9,415,700 9,403,672
6,330,414 4030202
23,420,784 23,426,010
4,237,242 5,479,207
997,346 834,397
28,655,372 29,739,614

0.46 0.39
0.86 0.83
15.78 15.92
85.45 64.34
90.23 70.36
11.00 9.91

1.22 1.27
<0 <1
Workings
Income Statement Items
tems
Automotive
Deliveries

Tesla Deliveries
2014 2015 2016 2017 2018 2019 2020
Vehicle Act Act Act Act Act Fcst Fcst
Tesla Model 3 - - - 1,764 152,977 260,000 364,000
Tesla Model S and X 33,600 50,580 76,230 101,312 99,475 101,465 103,494
Tesla Model Y - - - - - - 1,764
Tesla Roadster 2 - - - - - - 500
Tesla Pickup - - - - - 250 21,680
Tesla Semi - - - - - 250 21,680
Total 33,600 50,580 76,230 103,076 252,452 361,965 513,119
y-o-y growth %
Tesla Model 3 n.a. n.a. n.a. n.a. 8572% 70.0% 40%
Tesla Model S and X n.a. 51% 51% 33% -2% 2% 2%
Tesla Model Y n.a. n.a. n.a. n.a. n.a. 8572% 90%
Tesla Roadster 2 n.a. n.a. n.a. n.a. n.a. n.a. n.a.
Tesla Pickup n.a. n.a. n.a. n.a. n.a. n.a. 8572%
Tesla Semi n.a. n.a. n.a. n.a. n.a. n.a. 8572%

Assumed growth after introduction:

2 years 10%
2 years 5%
onwards 2%
Tesla Deliveries
2021 2022 2023 2024 2025 2026 2027 2028
Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst
400,400 440,440 462,462 485,585 495,297 505,203 515,307 525,613
105,564 107,675 109,828 112,025 114,266 116,551 118,882 121,259
152,977 290,656 465,050 511,555 562,711 590,846 620,388 632,796
1,000 1,500 1,650 1,815 1,906 2,001 2,041 2,082
32,521 48,781 53,659 59,025 61,976 65,075 66,376 67,704
41,193 65,908 72,499 79,749 83,737 87,924 89,682 91,476
733,654 954,961 1,165,149 1,249,754 1,319,892 1,367,599 1,412,677 1,440,930

10% 10% 5% 5% 2% 2% 2% 2%
2% 2% 2% 2% 2% 2% 2% 2%
60% 10% 10% 5% 5% 2% 2% 2%
100% 50% 10% 10% 5% 5% 2% 2%
50% 50% 10% 10% 5% 5% 2% 2%
90% 60% 10% 10% 5% 5% 2% 2%
 Notes/sources:
2029
Fcst
536,125 * https://www.bloomberg.com/graphics/2018-tesla-tracker/
123,685 * http://ir.tesla.com/static-files/0b913415-467d-4c0d-be4c-9225c2cb0ae0
645,452 * we assume similar pattern to Model 3 as it falls within the same class
2,124 *
69,058
93,305 *highly anticipated from commercial side
1,469,749

2%
2%
2%
2%
2%
2%
Deliveries comparables

Comparables as of 2017

Vehicle Average Adj. Average

GM 9,600,340 9,600,340
Ford 6,607,000 6,607,000
Fiat Chrysler 4,740,000 4,740,000
BMW 2,460,000 2,460,000
Volkswagen 10,700,000 10,700,000
Jaguar n.a. n.a.
Porsche n.a. n.a.
Ferrari n.a. n.a.
Scania n.a. n.a.
MAN n.a. n.a.
Paccar n.a. n.a.
Average n.a. 6,821,468
Revenue Automotive

Tesla Revenue Automotive

2014 2015 2016 2017 2018 2019 2020
Vehicle Act Act Act Act Act Fcst Fcst
Tesla Model 3 n.a. n.a. 10,920 15,288
Tesla Model S and X 3,007 3,741 6,351 n.a. n.a. 8,878 9,056
Tesla Model Y - - - - - - 88
Tesla Roadster 2 - - - - - - 115
Tesla Pickup - - - - - 16 1,366
Tesla Semi - - - - - 50 4,336
Total 3,007 3,741 6,351 9,641 18,515 19,864 30,249
Selected case
Tesla Model 3 100% 100%
Tesla Model S and X 100% 100%
Tesla Model Y 100% 100%
Tesla Roadster 2 100% 100%
Tesla Pickup 100% 100%
Tesla Semi 100% 100%

Best case
Tesla Model 3 101% 101%
Tesla Model S and X 101% 101%
Tesla Model Y 101% 101%
Tesla Roadster 2 101% 101%
Tesla Pickup 101% 101%
Tesla Semi 101% 101%

Base case
Tesla Model 3 100% 100%
Tesla Model S and X 100% 100%
Tesla Model Y 100% 100%
Tesla Roadster 2 100% 100%
Tesla Pickup 100% 100%
Tesla Semi 100% 100%

Worst case
Tesla Model 3 99% 99%
Tesla Model S and X 99% 99%
Tesla Model Y 99% 99%
Tesla Roadster 2 99% 99%
Tesla Pickup 99% 99%
Tesla Semi 99% 99%
Tesla Revenue Automotive (in mln $)
2021 2022 2023 2024 2025 2026 2027 2028 2029
Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst
16,817 18,498 19,423 20,395 20,802 21,219 21,643 22,076 22,517
9,237 9,422 9,610 9,802 9,998 10,198 10,402 10,610 10,822
7,649 14,533 23,253 25,578 28,136 29,542 31,019 31,640 32,273
230 345 380 417 438 460 469 479 488
2,049 3,073 3,381 3,719 3,904 4,100 4,182 4,265 4,351
8,239 13,182 14,500 15,950 16,747 17,585 17,936 18,295 18,661
44,220 59,053 70,546 75,860 80,026 83,104 85,652 87,365 89,112

100% 100% 100% 100% 100% 100% 100% 100% 100%

100% 100% 100% 100% 100% 100% 100% 100% 100%
100% 100% 100% 100% 100% 100% 100% 100% 100%
100% 100% 100% 100% 100% 100% 100% 100% 100%
100% 100% 100% 100% 100% 100% 100% 100% 100%
100% 100% 100% 100% 100% 100% 100% 100% 100%

101% 101% 101% 101% 101% 101% 101% 101% 101%

101% 101% 101% 101% 101% 101% 101% 101% 101%
101% 101% 101% 101% 101% 101% 101% 101% 101%
101% 101% 101% 101% 101% 101% 101% 101% 101%
101% 101% 101% 101% 101% 101% 101% 101% 101%
101% 101% 101% 101% 101% 101% 101% 101% 101%

100% 100% 100% 100% 100% 100% 100% 100% 100%

100% 100% 100% 100% 100% 100% 100% 100% 100%
100% 100% 100% 100% 100% 100% 100% 100% 100%
100% 100% 100% 100% 100% 100% 100% 100% 100%
100% 100% 100% 100% 100% 100% 100% 100% 100%
100% 100% 100% 100% 100% 100% 100% 100% 100%

99% 99% 99% 99% 99% 99% 99% 99% 99%

99% 99% 99% 99% 99% 99% 99% 99% 99%
99% 99% 99% 99% 99% 99% 99% 99% 99%
99% 99% 99% 99% 99% 99% 99% 99% 99%
99% 99% 99% 99% 99% 99% 99% 99% 99%
99% 99% 99% 99% 99% 99% 99% 99% 99%
Average
Price ($)
42,000
87,500
50,000
230,000
63,000
200,000
672,500
GP %

Comparables (from the statements of comparable companies)

GP % GP % GP %
Vehicle Comparable companies Comp. 1 Comp. 2 Comp. 3 Average
Tesla Model 3 GM, Ford, Fiat Chrysler 13.9% 7.9% 15.3% 12.4%
Tesla Model S and X BMW, Mercedes Cars, Volkswagen 18.4% 20.8% 18.4% 19.2%
Tesla Model Y BMW, Mercedes Cars, Volkswagen 18.4% 20.8% 18.4% 19.2%
Tesla Roadster 2 Jaguar, Porsche, Ferrari 38.1% 28.2% 51.7% 39.3%
Tesla Pickup GM, Ford, Fiat Chrysler 13.9% 7.9% 15.3% 12.4%
Tesla Semi Scania, MAN, Paccar 24.6% 18.6% 14.3% 19.2%

Historical
Vehicle Average
Tesla Model 3 n.a.
Tesla Model S and X 25%
Tesla Model Y n.a.
Tesla Roadster 2 n.a.
Tesla Pickup n.a.
Tesla Semi n.a.
Gross Profit

Tesla Gross Profit (

2014 2015 2016 2017 2018 2019 2020
Vehicle Act Act Act Act Act Fcst Fcst
Tesla Model 3 n.a. n.a. n.a. n.a. n.a. 1,352 1,892
Tesla Model S and X n.a. n.a. n.a. n.a. n.a. 1,706 1,740
Tesla Model Y - - - - - - 17
Tesla Roadster 2 - - - - - - 45
Tesla Pickup - - - - - 2 169
Tesla Semi - - - - - 10 831
Total 861 918 1,601 2,209 4,341 3,069 4,695
Selected case
Tesla Model 3 12% 12%
Tesla Model S and X 19% 19%
Tesla Model Y 19% 19%
Tesla Roadster 2 39% 39%
Tesla Pickup 12% 12%
Tesla Semi 19% 19%

Best case
Tesla Model 3 13% 13%
Tesla Model S and X 20% 20%
Tesla Model Y 20% 20%
Tesla Roadster 2 40% 40%
Tesla Pickup 13% 13%
Tesla Semi 20% 20%

Base case
Tesla Model 3 12% 12%
Tesla Model S and X 19% 19%
Tesla Model Y 19% 19%
Tesla Roadster 2 39% 39%
Tesla Pickup 12% 12%
Tesla Semi 19% 19%

Worst case
Tesla Model 3 12% 12%
Tesla Model S and X 19% 19%
Tesla Model Y 19% 19%
Tesla Roadster 2 39% 39%
Tesla Pickup 12% 12%
Tesla Semi 19% 19%
Tesla Gross Profit (in mln $)
2021 2022 2023 2024 2025 2026 2027 2028 2029
Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst
2,082 2,290 2,404 2,524 2,575 2,626 2,679 2,732 2,787
1,775 1,810 1,847 1,884 1,921 1,960 1,999 2,039 2,080
1,470 2,793 4,468 4,915 5,407 5,677 5,961 6,080 6,202
90 136 149 164 172 181 185 188 192
254 380 418 460 483 507 518 528 539
1,579 2,527 2,779 3,057 3,210 3,371 3,438 3,507 3,577
7,250 9,936 12,066 13,005 13,769 14,322 14,779 15,074 15,376

12% 12% 12% 12% 12% 12% 12% 12% 12%

19% 19% 19% 19% 19% 19% 19% 19% 19%
19% 19% 19% 19% 19% 19% 19% 19% 19%
39% 39% 39% 39% 39% 39% 39% 39% 39%
12% 12% 12% 12% 12% 12% 12% 12% 12%
19% 19% 19% 19% 19% 19% 19% 19% 19%

13% 13% 13% 13% 13% 13% 13% 13% 13%

20% 20% 20% 20% 20% 20% 20% 20% 20%
20% 20% 20% 20% 20% 20% 20% 20% 20%
40% 40% 40% 40% 40% 40% 40% 40% 40%
13% 13% 13% 13% 13% 13% 13% 13% 13%
20% 20% 20% 20% 20% 20% 20% 20% 20%

12% 12% 12% 12% 12% 12% 12% 12% 12%

19% 19% 19% 19% 19% 19% 19% 19% 19%
19% 19% 19% 19% 19% 19% 19% 19% 19%
39% 39% 39% 39% 39% 39% 39% 39% 39%
12% 12% 12% 12% 12% 12% 12% 12% 12%
19% 19% 19% 19% 19% 19% 19% 19% 19%

12% 12% 12% 12% 12% 12% 12% 12% 12%

19% 19% 19% 19% 19% 19% 19% 19% 19%
19% 19% 19% 19% 19% 19% 19% 19% 19%
39% 39% 39% 39% 39% 39% 39% 39% 39%
12% 12% 12% 12% 12% 12% 12% 12% 12%
19% 19% 19% 19% 19% 19% 19% 19% 19%
Cost of sales automotive

Tesla Gross Profit (i

2014 2015 2016 2017 2018 2019 2020
Vehicle Act Act Act Act Act Fcst Fcst
Tesla Model 3 n.a. n.a. n.a. n.a. n.a. (9,568) (13,396)
Tesla Model S and X n.a. n.a. n.a. n.a. n.a. (7,172) (7,316)
Tesla Model Y - - - - - - (71)
Tesla Roadster 2 - - - - - - (70)
Tesla Pickup - - - - - (14) (1,197)
Tesla Semi - - - - - (40) (3,505)
Total (2,146) (2,823) (4,750) (7,433) (14,174) (16,795) (25,554)
Tesla Gross Profit (in mln $)
2021 2022 2023 2024 2025 2026 2027 2028 2029
Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst
(14,735) (16,209) (17,019) (17,870) (18,228) (18,592) (18,964) (19,343) (19,730)
(7,462) (7,611) (7,763) (7,919) (8,077) (8,238) (8,403) (8,571) (8,743)
(6,179) (11,740) (18,784) (20,663) (22,729) (23,865) (25,059) (25,560) (26,071)
(140) (209) (230) (253) (266) (279) (285) (291) (296)
(1,795) (2,693) (2,962) (3,258) (3,421) (3,592) (3,664) (3,737) (3,812)
(6,659) (10,655) (11,720) (12,892) (13,537) (14,214) (14,498) (14,788) (15,084)
(36,970) (49,117) (58,480) (62,856) (66,258) (68,782) (70,873) (72,291) (73,736)
 Revenue and Gross Profit automotive

2014 2015 2016 2017 2018 2019

Vehicle Act Act Act Act Act Fcst
Revenue automotive 3,007 3,741 6,351 9,641 18,515 19,864
Gross Profit automotive 861 918 1,601 2,209 4,341 3,069
GP% 29% 25% 25% 23% 23% 15%

Tesla's Revenue and Gross Profit automotive

100,000

90,000

80,000

70,000

60,000
$ in million

50,000

40,000

30,000

20,000

10,000

-
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Act Act Act Act Act Fcst Fcst Fcst Fcst Fcst Fcst Fcst

Gross Profit automotive Revenue automotive GP%

 2020 2021 2022 2023 2024 2025 2026 2027 2028
Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst
30,249 44,220 59,053 70,546 75,860 80,026 83,104 85,652 87,365
4,695 7,250 9,936 12,066 13,005 13,769 14,322 14,779 15,074
16% 16% 17% 17% 17% 17% 17% 17% 17%

rofit automotive
35%

30%

25%

20%

15%

10%

5%

0%
022 2023 2024 2025 2026 2027 2028 2029
cst Fcst Fcst Fcst Fcst Fcst Fcst Fcst

ue automotive GP%
 2029
Fcst
89,112
15,376
17%
Energy&Other
Revenue Energy & Other

Tesla Revenue
2014 2015 2016 2017 2018 2019
($ in million) Act Act Act Act Act Fcst
Energy generation and storage 4 14 181 1,116 1,555 n.a.
Services and other 187 291 468 1,001 1,391 n.a.
Total Energy and Other 191 305 649 2,117 2,946 3,418
SolarCity 255 400 730 - - n.a.
Total Energy and Other + SolarCity 446 705 1,380 2,117 2,946 3,418
Selected case
Total Energy and Other 16%

Y-o-Y %
Best case
Total Energy and Other 17%

Base case
Total Energy and Other 58% 96% 53% 16%

Worst case
Total Energy and Other 16%
Tesla Revenue Energy & Other (in mln $)
2020 2021 2022 2023 2024 2025 2026 2027 2028
Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst
n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a.
n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a.
3,828 4,134 4,382 4,645 4,924 5,219 5,532 5,864 6,216
n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a.
3,828 4,134 4,382 4,645 4,924 5,219 5,532 5,864 6,216

12% 8% 6% 6% 6% 6% 6% 6% 6%

13% 9% 7% 7% 7% 7% 7% 7% 7%

12% 8% 6% 6% 6% 6% 6% 6% 6%

12% 8% 6% 6% 6% 6% 6% 6% 6%
 2029
Fcst Notes:
n.a.
n.a.
6,589
n.a.
6,589

6%

7%

6% * we're applying a conservative assumption towards revenue forecast to avoid excessive optimism

6%
Gross Profit Energy & Other

Tesla GP% E
2014 2015 2016 2017 2018 2019
($ in million) Act Act Act Act Act Fcst
Energy generation and storage 0 2 3 242 190 n.a.
Services and other 20 4 (4) (228) (489) n.a.
Total Energy and Other 20 6 (1) 14 (299) n.a.
SolarCity 79 119 251 - - n.a.
Total Energy and Other + SolarCity 99 125 250 14 (299) 501
Selected case
Total Energy and Other 22.2% 17.7% 18.1% 0.7% -10.1% 14.7%

GP%
Best case
Total Energy and Other 15.2%

Base case
Total Energy and Other 14.7%

Worst case
Total Energy and Other 14.2%
Tesla GP% Energy and Other (in mln $)
2020 2021 2022 2023 2024 2025 2026 2027 2028
Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst
n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a.
n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a.
n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a.
n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a.
561 606 642 681 722 765 811 860 911

14.7% 14.7% 14.7% 14.7% 14.7% 14.7% 14.7% 14.7% 14.7%

15.2% 15.2% 15.2% 15.2% 15.2% 15.2% 15.2% 15.2% 15.2%

14.7% 14.7% 14.7% 14.7% 14.7% 14.7% 14.7% 14.7% 14.7%

14.2% 14.2% 14.2% 14.2% 14.2% 14.2% 14.2% 14.2% 14.2%

2029
Fcst Notes:
n.a.
n.a.
n.a.
n.a.
966

14.7%

15.2%

14.7% * we take the average percentage of GP margin based on the historical figures

14.2%
Cost of sales Energy & Other

Tesla Cost of
2014 2015 2016 2017 2018 2019
($ in million) Act Act Act Act Act Fcst
Energy generation and storage (4) (12) (178) (875) (1,365) n.a.
Services and other (167) (287) (472) (1,229) (1,880) n.a.
Total Energy and Other (171) (299) (651) (2,104) (3,245) n.a.
SolarCity (176) (281) (479) - - n.a.
Total Energy and Other + SolarCity (347) (580) (1,130) (2,104) (3,245) (2,917)
Tesla Cost of sales Energy & Other (in mln $)
2020 2021 2022 2023 2024 2025 2026 2027 2028
Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst
n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a.
n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a.
n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a.
n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a.
(3,267) (3,528) (3,740) (3,964) (4,202) (4,454) (4,721) (5,004) (5,305)
 2029
Fcst
n.a.
n.a.
n.a.
n.a.
(5,623)
Operating expenses
Opex comparables

Comparables - 2017

Company Average Adj. Average

GM 14% 14%
Ford 13% 13%
Fiat Chrysler 10% 10%
BMW 10% 10%
Volkswagen 12% 12%
Jaguar 31%
Porsche 11% 11%
Ferrari 29%
Scania 15% 15%
MAN 15% 15%
Paccar 4%
Average 15% 12%

* given that Tesla is neither young nor a mature company we can't base our assumptions on historical figures. For that reason we take an a
figures. For that reason we take an average industry value as a percentage of revenue
Opex

2014 2015 2016 2017 2018 2019

($ in million) Act Act Act Act Act Fcst
Revenues 3,453 4,446 7,730 11,759 21,461 23,282
Opex as a % of revenues -30.9% -36.9% -29.3% -32.8% -20.6% 12%
Opex (1,068) (1,640) (2,267) (3,855) (4,430) (2,908)

Selected case
Opex as a % of revenue 12.5%

Opex %
Best case
Opex as a % of revenue 12.0%

Base case
Opex as a % of revenue 12.5%

Worst case
Opex as a % of revenue 13.0%
 Tesla Opex (in mln $)
2020 2021 2022 2023 2024 2025 2026 2027
Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst
34,077 48,354 63,435 75,191 80,784 85,246 88,636 91,516
12% 12% 12% 12% 12% 12% 12% 12%
(4,257) (6,040) (7,924) (9,393) (10,091) (10,649) (11,072) (11,432)

12.5% 12.5% 12.5% 12.5% 12.5% 12.5% 12.5% 12.5%

12.0% 12.0% 12.0% 12.0% 12.0% 12.0% 12.0% 12.0%

12.5% 12.5% 12.5% 12.5% 12.5% 12.5% 12.5% 12.5%

13.0% 13.0% 13.0% 13.0% 13.0% 13.0% 13.0% 13.0%

 2028 2029
Fcst Fcst
93,581 95,701
12% 12%
(11,690) (11,955)

12.5% 12.5%

12.0% 12.0%

12.5% 12.5%

13.0% 13.0%
Balance Sheet items
 Property, Plant & Equipme

Two ways to forecast Capex: Two ways of modelling D&A

1. Model as a % of beginning PPE 1. Building a complete D&A schedule (difficult
2. Model as a % of revenues (rarely the case) 2. % od revenues or beginning PP&E
Equipment

D&A schedule (difficult --> historical assets (aka ending PP&E from previous year)/useful life of historical assets + Capex/usefu
eginning PP&E
f historical assets + Capex/useful life Capex
Fixed asset roll forward Ending PPE=Beginning PPE +Capex - D&A

Selected case: as a % of PPE 1

31Dec2014 31Dec2015 31Dec2016 31Dec2017 31Dec2018

Act Act Act Act Act
($ in million)
Beginning PP&E 738 1,829 3,403 5,983 10,028
Capex 1,323 1,997 3,527 5,211 3,204
D&A (232) (423) (947) (1,166) (1,901)
Ending PP&E 1,829 3,403 5,983 10,028 11,330
Te
2014 2015 2016 2017 2018
($ in million) Act Act Act Act Act
2019
Fcst
2020
Fcst
2021
Fcst
2022
Fcst
2023
Fcst
2024Fcst
2025Fcst
2026Fcst
2027Fcst
2028Fcst
2029Fcst
Total D&A (232) (423) (947) (1,166) (1,901)
D&A as a % of PP&E -31.4% -23.1% -27.8% -19.5% -19.0%
D&A as a % of revenues -6.7% -9.5% -12.3% -9.9% -8.9%
Capex as a % of PP&E 179.1% 109.2% 103.6% 87.1% 31.9%
Capex as a % of revenues 41.4% 49.3% 50.4% 44.3% 43.2%

Useful life Capex : 15

Useful life historical assets : 15

Two ways to forecast Capex:

1. Model as a % of beginning PPE
2. Model as a % of revenues

Two ways of modelling D&A

1. Building a complete D&A schedule
2. % of revenues or beginning PP&E
 Tesla PP&E (in mln $)
31Dec2019 31Dec2020 31Dec2021 31Dec2022 31Dec2023 31Dec2024 31Dec2025 31Dec2026 31Dec2027
Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst
11,330 15,862 20,651 24,877 28,713 33,029 37,873 42,238 46,942
5,665 6,345 6,195 6,219 7,178 8,257 8,332 9,292 9,388
(1,133) (1,556) (1,969) (2,384) (2,862) (3,413) (3,968) (4,588) (5,214)
15,862 20,651 24,877 28,713 33,029 37,873 42,238 46,942 51,117
Tesla D&A schedule (in mln $)
2019 2020 2021 2022 2023 2024 2025 2026 2027
Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst
(1,133) (1,133) (1,133) (1,133) (1,133) (1,133) (1,133) (1,133) (1,133)
(423) (423) (423) (423) (423) (423) (423) (423)
(413) (413) (413) (413) (413) (413) (413)
(415) (415) (415) (415) (415) (415)
(479) (479) (479) (479) (479)
(550) (550) (550) (550)
(555) (555) (555)
(619) (619)
(626)

(1,133) (1,556) (1,969) (2,384) (2,862) (3,413) (3,968) (4,588) (5,214)

-25.5% -25.5% -25.5% -25.5% -25.5% -25.5% -25.5% -25.5% -25.5%
-4.6% -4.1% -3.8% -3.8% -4.2% -4.7% -5.2% -5.7%
50.0% 40.0% 30.0% 25.0% 25.0% 25.0% 22.0% 22.0% 20.0%
45.7% 20.0% 15.0% 10.0% 10.0% 10.0% 10.0% 10.0% 10.0%

Steps:
1. Estimate Capex (for Capex as a % of PP&E we take a historical average, and then we ca
2. Build D&A schedule
 31Dec2028 31Dec2029
Fcst Fcst
51,117 55,445
10,223 9,426
(5,895) (6,523)
55,445 58,348

2028 2029
Fcst Fcst
(1,133) (1,133)
(423) (423)
(413) (413)
(415) (415)
(479) (479)
(550) (550)
(555) (555)
(619) (619)
(626) (626)
(682) (682)
(628)
(5,895) (6,523)
-25.5% -25.5% *seems like we don’t need it
-6.3% -6.8% *seems like we don’t need it
20.0% 17.0%
10.0% 10.0%

verage, and then we can assume downgrading trend in Capex inves(For Capex as % of revenues - same approach)
ame approach)
PP&E comparables

Comparables - 2017

D&A as a % of PP&E D&A as a % of revenues

Company Average Adj. Average Average Adj. Average
GM -34% -34% -8% -8%
Ford -24% -24% -5% -5%
Fiat Chrysler -20% -20% -5% -5%
BMW -42% -42% -6% -6%
Volkswagen -40% -40% -10% -10%
Jaguar -28% -28% -7% -7%
Porsche -39% -39% -10% -10%
Ferrari -37% -37% -8% -8%
Scania -13% -13% -3% -3%
MAN -37% -37% -7% -7%
Paccar
Average -31% -31% -7% -7%
Working capital
Working Capital comparables

Comparables - 2017

DSO DIO DPO

Vehicle Average Adj. Average Average Adj. Average Average

GM 22.0 22.0 28.8 28.8 75.0
Ford 28.2 28.2 21.2 21.2 60.6
Fiat Chrysler 25.6 25.6 41.9 41.9 84.0
BMW 9.7 9.7 46.4 46.4 44.5
Volkswagen 20.8 20.8 63.1 63.1 44.1
Jaguar 18.8 51.2 155.5
Porsche 9.2 9.2 46.8 46.8 65.0
Ferrari 25.2 25.2 41.5 41.5 132.5
Scania 27.1 27.1 64.9 64.9 55.9
MAN 54.5 85.3 59.4
Paccar 22.3 22.3 18.4 18.4 59.3
Average 24.0 21.1 46.3 41.4 76.0
DPO Net trade cycle
Adj. Adj.
Average Average Average
75.0 (24.20) (24.20)
60.6 (11.17) (11.17)
84.0 (16.52) (16.52)
44.5 11.60 11.60
44.1 39.82 39.82
(85.39)
65.0 (9.11) (9.11)
132.5 (65.77) (65.77)
55.9 36.14 36.14
80.38
59.3 (18.62) (18.62)
69.0 (5.71) (6.43) * negative CCC means that a company generates revenue from customers before it has to pay for inv
* The cash conversion cycle (CCC) is a metric that expresses the time (measured in days) it takes for
m customers before it has to pay for inventory, among other things
he time (measured in days) it takes for a company to convert its investments in inventory and other resources into cash flows from sales.
Working capital

Tesla Working ca
31Dec2014 31Dec2015 31Dec2016 31Dec2017 31 Dec2018 31Dec2019 31Dec2020
Act Act Act Act Act Fcst Fcst
($ in million)
Trade receivables 227 169 499 515 949 1,266 1,854
Inventory 954 1,278 2,067 2,264 3,113 6,386 9,337
Trade payables 778 916 1,860 2,390 3,404 5,597 8,184
Net trade cycle 402 531 706 389 658 2,055 3,007

Selected case:
DSO 25.5 15.0 25.7 15.8 15.9 19.6 19.6
DIO 148.2 147.3 137.8 85.4 64.3 116.6 116.6
DPO 120.9 105.6 124.0 90.2 70.4 102.2 102.2
Net trade cycle 52.8 56.7 39.5 11.0 9.9 34.0 34.0
Tesla Working capital (in mln $)
31Dec2021 31Dec2022 31Dec2023 31Dec2024 31Dec2025 31Dec2026 31Dec2027 31Dec2028 31Dec2029
Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst

2,630 3,450 4,090 4,394 4,637 4,821 4,978 5,090 5,205

13,120 17,123 20,229 21,724 22,908 23,812 24,581 25,138 25,709
11,499 15,009 17,731 19,041 20,078 20,871 21,545 22,033 22,534
4,250 5,565 6,588 7,077 7,466 7,762 8,014 8,195 8,381

19.6 19.6 19.6 19.6 19.6 19.6 19.6 19.6 19.6

116.6 116.6 116.6 116.6 116.6 116.6 116.6 116.6 116.6
102.2 102.2 102.2 102.2 102.2 102.2 102.2 102.2 102.2
34.0 34.0 34.0 34.0 34.0 34.0 34.0 34.0 34.0
Financing
Financing

Cover negative cash flows with:

Debt 50%
Equity 50%

Bond Yield as of Mar 29 2019 8.1%

31Dec2014 31Dec2015 31Dec2016 31Dec2017

Act Act Act Act
($ in million)
Long-term debt and capital leases, (outstanding debt) 1,818.8 2,021.1 5,860.0 9,415.7
Interest expense (100.9) (118.9) (198.8) (471.3)
Interest rate -5.5% -5.9% -3.4% -5.0%

2014 2015 2016 2017

Act Act Act Act
Unlevered Free Cash Flow (1,829.6) (7,313.3) (4,687.5)
Debt
Equity

Assumption #1: When UFCF<0, Tesla raises financing on the first day of the following year;
Assumption #2: 50% debt, 50% equity;
Assumption #3: Tesla's bond yield - 8.1%.
 Tesla Financing (in mln $)
31Dec2018 31Dec2019 31Dec2020 31Dec2021 31Dec2022 31Dec2023 31Dec2024 31Dec2025 31Dec2026
Act Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst
9,403.7 9,403.7 9,403.7 9,403.7 9,403.7 9,403.7 9,403.7 9,403.7 7,532.7
(663.1) (757.0) (757.0) (757.0) (757.0) (757.0) (757.0) (757.0) (606.4)
-7.1% 8.1% 8.1% 8.1% 8.1% 8.1% 8.1% 8.1% 8.1%

Tesla Cash Flow (in mln $)

2018 2019 2020 2021 2022 2023 2024 2025 2026
Act Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst
(2,866.3) 3,175.6 1,883.7 4,959.0 1,997.8 3,737.8 412.8 (3,742.0) (4,818.7)
- - - - - - (1,871.0) (2,409.4)
- - - - - - (1,871.0) (2,409.4)
31Dec2027 31Dec2028 31Dec2029
Fcst Fcst Fcst
5,123.3 5,062.6 4,799.2 Outstanding debt (end of 2018)=Outstanding d
(412.4) (407.5) (386.3)
8.1% 8.1% 8.1%

2027 2028 2029

Fcst Fcst Fcst
(121.4) (526.9) 984.4
(60.7) (263.4) -
(60.7) (263.4) -
g debt (end of 2018)=Outstanding debt (end of 2017) + newly raised debt (2018)
WACC

Risk-free rate 2.44%

Market risk premium 5.00%
Beta (as of 27 Sep 2018) 0.05
Tax rate 30%

Cost of equity 2.7%

Current bond Yield as of Mar29 201 8.1%

Tesla WA
31Dec2014 31Dec2015 31Dec2016 31Dec2017 31Dec2018 31Dec2019
Act Act Act Act Act Fcst
($ in million)
Debt 2,430 2,649 7,010 10,312 11,971 11,971
Equity 912 1,084 5,538 5,235 6,314 6,219

Debt / (Debt + Equity) 73% 71% 56% 66% 65% 66%

Equity / (Debt + Equity) 27% 29% 44% 34% 35% 34%

Cost of equity 2.7% 2.7% 2.7% 2.7% 2.7% 2.7%

Cost of debt 8.1% 8.1% 8.1% 8.1% 8.1% 8.1%

WACC 4.8% 4.8% 4.3% 4.6% 4.6% 4.6%

Notes:

WACC = (D/(D+E)) *Kd*(1-t)+ (E/(D+E))*Ke CAPM = Rf + B*Market Risk Premium

D - Amount of debt financing Rf - an asset with the minimum default risk (10 years US government bond)
Kd = Cost of debt Market risk premium - between 4.5% and 5.5%
t = Tax rate Company beta - a measure of stock's volatility in relation to the market
E= amount of equity financing
Ke= cost of equity
 Tesla WACC calculation (in mln $)
31Dec2020 31Dec2021 31Dec2022 31Dec2023 31Dec2024 31Dec2025 31Dec2026 31Dec2027 31Dec2028
Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst Fcst

11,971 11,971 11,971 11,971 11,971 10,100 7,691 7,630 7,367

6,388 7,129 8,457 10,275 12,290 12,609 12,618 15,213 17,671

65% 63% 59% 54% 49% 44% 38% 33% 29%

35% 37% 41% 46% 51% 56% 62% 67% 71%

2.7% 2.7% 2.7% 2.7% 2.7% 2.7% 2.7% 2.7% 2.7%

8.1% 8.1% 8.1% 8.1% 8.1% 8.1% 8.1% 8.1% 8.1%

4.6% 4.5% 4.4% 4.3% 4.1% 4.0% 3.8% 3.7% 3.6%

Beta = COV(Ri,Rm) / Var (Rm) Stages:

S government bond) Ri - the rate of return of the stock we are looking at (Tesla) 1. Data input(Risk free rate, MPR, Beta, tax rate)
Rm - the market's rate of return (S&P500) 2. Link the debt and equity from the BS
on to the market 3. Calculate the debt and equity ratios
4. Calculate WACC
 31Dec2029
Fcst

7,367
20,472

26%
74%

2.7%
8.1%

3.5%

ate, MPR, Beta, tax rate)

ty from the BS
d equity ratios