My recent article on Tesla Motors (TSLA) was a success: I received quite a lot of feedback (mostly positive). In that article, I want over Tesla's historical cash flow statements and pointed out that the more the company grows, the more cash it seems to burn in the process. In fact, in the past twelve months, Tesla spent more money on CapEx than in any year before (and almost the same amount as in the prior years combined). I also mentioned that I had prepared a valuation model on the company's stock but I did not share it with the readers. I would like to do it in this article. Tesla's DCF model has three scenarios built-in: a Base Scenario (an average 19.7% CAGR in revenues in the next five years, a rising EBITDA margin to 5.0% of revenues in 2019, and an 11% discount rate), a Bull Case (an average 25.9% CAGR in the top line, an increasing EBITDA margin to 6.0% in 2019, and an 11% discount rate), and a Stress Case (an average 15.6% CAGR in revenues, an increasing EBITDA margin to (2.0)% in 2019, and an 11% discount rate). The model's Base Scenario's output is provided below (see the rest in the model): Note: Tesla's valuation may alter significantly, if the company substantially cuts its CapEx. Essentially, I admit that my CapEx projections may be too aggressive for the next five years. The model shows that Tesla's value is 100% dependent on the revenue multiple used to calculate the company's terminal value. In the model, I used the current implied multiple of ~7.6x revenues. A historical analysis shows that the multiple has been declining for the past two years: (Source: Capital IQ. Infographics by author) Because the company's revenues have been on the rise (a 30% increase in year-over-year revenues is expected by the end of 2015), while the company's stock only gained about 5.5% over the last 52 weeks, this negative dynamics is justified. Moreover, there is nothing bad when the multiple drops as a results of revenue growth. What is really bad, however, is when the multiple drops because the company's market value declines. This is a huge risk for Tesla because the current multiple is extremely high. This is especially seen in comparison with the peers: (Source: Capital IQ) While readers may disagree with the peer list, as the other companies do not sell exactly the same product as Tesla does, the truth is that Tesla's cars are in direct competition with what these companies sell. And the fact that Tesla does not have a direct competitor of a similar size is actually detrimental to the company's valuation. Essentially, investors have no benchmark to measure Tesla's current valuation against. This means that they are on a very shaky ground. I hope you enjoyed my analysis. Feel free to download the model and run your own numbers on it.