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Wall Street Match Up: Kandi Technologies Vs. Tesla Motors

Last July, I published the tenth of a string of articles on China based, Nasdaq listed Kandi Technologies, Inc.(KNDI) titled; “Kandi Technologies Set to Be Big Winner in International Electric Car Market.” The day before that article came out, KNDI had closed at $2.47 a share. In that article, I had a section titled “Kandi vs. Tesla,” where I said the following:

“Based on all available public information on both companies, the odds are extremely in favor that over the next three to four years, but perhaps a lot sooner, KNDI’s stock will be trading higher then TSLA’s. That is not to say that Tesla will not do well in the future. I base this on its existing share price just under $28, giving it a current market cap of some $3.1 billion which is priced some 30 times Morgan Stanley’s (MS) Base 2015 earnings estimate of 1.07 GAAP, and 19 times MS 2019 GAAP earnings estimate. This MS report did not factor in the 7.5 million share dilution for its recent $220 million offering completed in May… “

Also In that section:

“I have elected to compare the two companies not to denigrate TSLA as I am of the conclusion, particularly after doing research for this article that TSLA seems to be doing things right in attempting to capture a lead position in their niche of medium to higher priced EVs. However, while the potential market for EVs over the next decade and beyond is immense, TSLA is still going to be effectively competing “heads up” with most of the world’s major auto manufacturers competing for market share. KNDI and its CEO/founder, on the other hand, are following the historic model of Henry Ford with his Model T and Ferdinand Porsche with his Volkswagen or “People’s Car” by providing EVs for sale to the masses at prices from as low as $6,100 to as high as $14,000 and doing it with incredible government sponsorship.”

Now KNDI is trading around the $3 level and TSLA, while having recently had a run above $35, is now back to that same $28 level. Not a big move up for KNDI, but a performance that certainly has outperformed all major market indexes and the vast majority of U.S. listed China stocks over this time. What caused this better performance by KNDI certainly had nothing to do with any major event published by the media or announced by the company with a press release. Quite the contrary; aside from a recently completed, exceptionally well done Four Part KNDI Seeking Alpha article by Taiwan based Marc Chang, there has been no media; and only three company press releases to include in reverse order; an announcement last week of the annual shareholders meeting, an OK, but “nothing to write home about” press release on second quarter results, Nov. 14, and on Oct. 17th a interesting tidbit titled: “Kandi Technologies, Corp. Announces the Government Subsidies to 3,000 Kandi Pure Energy Vehicles by Jinhua City and Zhejiang Province.” This last, while actually very noteworthy, saw the stock price decline on only 35,000 shares of volume on the day of release.


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