Potential Landing Spots For Tesla Motors Inc (TSLA)

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Google

Google Inc (NASDAQ:GOOG) would also make sense, considering their advancements in driver-less cars. Google has already equipped its driver-less car technology on hybrid vehicles such as the Toyota Prius. Owning a company such as Tesla would surely boost Google’s accessibility for test vehicles, as it would already own the vehicles and not have to purchase them.

Google Inc (NASDAQ:GOOG) isn’t the only company that is actively seeking driver-less and autonomous vehicles, but it does receive most of the attention. With these efforts, it becomes obvious that Google wants to expand into new areas, despite providing results for over 5 billion searches each day. Like Apple, Google Inc (NASDAQ:GOOG) has the cash to purchase Tesla. Although it’s not $150 billion like Apple, Google’s mountain of cash is worth $50 billion.

Considering Google has the money and is already involved in creating innovative vehicles, wouldn’t a Tesla acquisition make sense for Google?

Valuation

Considering that neither of these companies have acquired Tesla, and may never, it is important to look at them as separate companies. The tables below will give valuations as well as what a potential investor would be purchasing (or selling).

Company P/E FCF Yield Earnings Yield EPS TTM Revenue Gross Margins
Apple 10.5 10.7% 9.1% 40.1 $169.4 B 38.3%
Google 25.6 4.3% 3.9% 34.5 $53.5 B 57.4%


The bottom line

Elon Musk has clearly left the door open for a potential buy out, but it is up to these other companies to make an offer. Tim Cook made it obvious that Apple wants to engage in the auto industry more than they previously have, and Google is already involved in making innovative vehicles. Both companies have the cash to buy Tesla Motors Inc (NASDAQ:TSLA), but are they willing to purchase Tesla considering its growth in recent months? Only time will tell.

The article Potential Landing Spots For Tesla Motors originally appeared on Fool.com and is written by Tyler Wofford.

Tyler Wofford has no position in any stocks mentioned. The Motley Fool recommends Apple, Google, and Tesla Motors . The Motley Fool owns shares of Apple, Google, and Tesla Motors. Tyler is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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