2017 Investor Roundtable: TSLA Market Action

[TrendTrader007]

Hold the line
Love isn't always on time

 

[vgrinshpun]

No idea if this is accurate or not. But the person does comment a lot on Tesla articles over on electrek.

View attachment 254363

BTW, I am continuing to monitor registration of Model 3 VINs with NHTSA (huge thanks to @Alketi and @Dagger for helping with automating this task!). So far, there were no changes since I started monitoring the VINs shortly before the deliveries press release.

If Tesla indeed produced additional 246 cars in the last 16 days, and continue to ramp up, they will need to add new VIN registrations pretty soon...

 

[zdriver]

Looks like over 400,000 shares traded hands between 4 and 4.01 pm. I guess this was some kind of late fill for closing trades of the day that just spilled into AH. It is a VERY large number for what was otherwise a fairly ordinary volume type day. Not sure what to make of it.
Papafox has some thoughts in his thread.

If memory serves, the MOC (market-on-close) order was 250k shares to-buy, followed 9 seconds later (4:00:09) by a 200k share order at the same price as closing, that thinkorswim marked as a buy. (ask side)

The former is normal, albeit about double-ish the normal quantity. MOC orders for TSLA hasn't been very predictive from what I've seen, but I haven't done very extensive stats on it. The extra order was a thing right after the big July drop too as I recall, but we never really decided what it meant. Probably just more chop chop chop like we've seen for the past few months...

 

[geneclean55]

Senate is due to vote on PR disaster relief funding this week. Supposed to include money that can be spent on electricity grid.

 

[Gerardf]

View attachment 254393 Hold the line
Love isn't always on time

In more than one way hat chart has your fingerprint all over it

 

[mongo]

In more than one way hat chart has your fingerprint all over it

xkcd: Color Pattern



Looking for some Lloyd (Green Ninja) action in the market tomorrow.

 

[ValueAnalyst]

I do not see any indication at this time that Model 3 production is 8+ weeks delayed. The facts that Model X was extremely delayed or that Elon majority of the time proves optimistic are not indications, but an example of reasoning by anology.

Indications in support of a view that Model 3 production is only slightly delayed:

• Tesla has not yet changed the delivery estimates on its website as of today;
• Latest management guidance we have is, "Dec will be a big month" and "Late Oct possible, but not certain" for start of non-employee deliveries, and this is as of October 6, so very recent;
• Tesla Semi event was moved by only two weeks;
• Elon would not be posting production line videos if there was an 8+ week delay, because it could be construed as misleading; and
• Tesla explained that recent firings were based on annual performance reviews, so this is not an indication of further than feared delays.

I'm reading the responses, and maybe I'm missing something, but I have not yet seen a material indication in support of delay estimates as high as 8+ weeks.

In response to the earlier question around how SP would be affected if Model 3 production was in fact delayed by two months, I do not see SP dropping as it did in February of 2016, unless Model S and Model X are significantly Osborned, which I do not expect.

Woot woot
Seems like it was a ~2 week delay.

Twig Mouse on Twitter
View attachment 254391
Received VIN on Sept 25
Body mated to drive-train ~Sept 25-26
Twig mouse hoped to receive car Oct 2-3
Twig mouse received car Oct 16

This is the sixth indication that Model 3 production ramp is behind by only two to three weeks.

I note that the 3,005 unit prediction by Oppy (see below), after a recent management meeting, is an indication of a longer delay.

Rusch from the Oppenheimer note estimates Tesla’s total Model 3 deliveries at 3,005 units this year. We now have at least 3 analysts with similarly low numbers, and this one just met with Tesla management. I've got to believe that's a pretty accurate estimate at this point in time with what is known. Even though the production curve is difficult to predict and it could be higher (or lower), this is roughly the number to expect by the end of December 2017. The question is, is that the number the market now expects for this year? This and the other analysts' notes are out there as well as the comments from EM, so I think the market probably does expect somewhere around 2-4K by the end of this year. This suggests a delay of about 2 1/2 months. It sure seems like the J20s will be out before this stock shoots up.

 

[vgrinshpun]

This is the sixth indication that Model 3 production ramp is behind by only two to three weeks.

There is one indication that pretty much kills this possibility. There is only 1100 VINs registered with NHTSA. If production would have been behind by only by 2 to 3 weeks, Tesla would have produced much more that 1100 cars by now. Since we now know that a M3 VIN is registered with NHTSA some time before the car enters production, Tesla is definitely more than 2-3 weeks behind.

 

[vgrinshpun]

Here is additional deltails coming from the Oppenheimer yesterday's note:

EDIT: MY apologies, this is from their August 10th note, not the note issued yesterday

• “TSLA continued to exude confidence in reaching its 25% GM targets on Model 3 production but would not commit to a time frame. We believe the take-rate on options will be a key driver as we believe they carry a higher than average GM profile.”
• “TSLA indicated that even past flat 2H17 operating expense, the company expected slower growth in operational spending, which implies earnings leverage. We believe demonstration of such earnings leverage would be a significant catalyst to move shares higher.”

 

[ValueAnalyst]

MACD had the downward cross at the beginning of July. It has been negative for almost 4 months, but the stock refuse to go down. This set up usually leads to big rally.

About 15 years ago, I was casually chatting with a successful portfolio manager, who was one of my mentors at the time. He had, for over two decades, been with an international asset management firm, which had multi-billion dollar AUM and an investment style of extensive bottom-up fundamental research with a macro overlay.

During our conversation, I told him that I was using technical analysis to pick stocks. He laughed, and laughed, and laughed, and said (and I remember it like yesterday):

"We piss on the hands of technical analysts."

I was very angry, but I didn't say anything to him at the time. I just paused. I had invested years in learning and practicing technical analysis, and I thought I was doing okay. I thought that what he had said was an extremely arrogant thing to say, and I was done with the conversation.

Ever since, however, I have repeatedly noticed setups like the one you described above: an indisputably strong technical signal (in this case, the "downward MACD cross"), but the stock price just does not act as predicted ("refuse to go down"). This is what's called a bear trap, and I agree with your last sentence.

To this day, I wonder if stock prices are manipulated to show certain chart setups to sway retail investors. I don't know the answer, but I no longer think that this idea is as crazy as it sounded 15 years ago.

 

[ValueAnalyst]

There is one indication that pretty much kills this possibility. There is only 1100 VINs registered with NHTSA. If production would have been behind by only by 2 to 3 weeks, Tesla would have produced much more that 1100 cars by now. Since we now know that a M3 VIN is registered with NHTSA some time before the car enters production, Tesla is definitely more than 2-3 weeks behind.

Good point.

 

[vgrinshpun]

Nomura lays out China track for Tesla (via Seeking Alpha Market News):

More details from the Nomura note, via StreetInsider.com

Nomura/Instinet analyst, Romit Shah, reiterated his Buy rating on shares of Tesla Motors (NASDAQ: TSLA) after hosting an expert call with Michael Dunne, President of Hong Kong-based Dunne Automotive which advises investors and automakers on the future of China's auto-tech sector.

Mr Dunne believes that in order to capitalize on the large Chinese opportunity, the company must give up a large portion of local ownership and lock away IP in free trade zones. The analyst pointed out 3 themes and 2 best possible outcomes for the company:

Themes:

1) In order to become a meaningful participant in China’s rapidly expanding Luxury and EV markets, Tesla must localize production

2) Localizing production would require Tesla to surrender majority ownership of its Chinese entity in a JV partnership and meet various other Chinese government requirements

3) Tesla should feel a sense of urgency to reach an agreement with Chinese officials given the
impending threat from emerging domestic brands.

Best Possible Outcomes:

1) Tesla develops a local manufacturing operation by partnering with a Chinese technology leader –
such as Tencent (5% TSLA shareholder) – protecting key IP and leveraging political capital in negotiations with Chinese regulators.

2) The company (or JV) establishes a manufacturing facility in a free trade zone (FTZ) wherein
Tesla produces IP sensitive components (such as batteries) before shipping into mainland China (at a reduced import tariff) for final vehicle assembly.

No change to the price target of $500.

 

[DurandalAI]

To this day, I wonder if stock prices are manipulated to show certain chart setups to sway retail investors. I don't know the answer, but I no longer think that this idea is as crazy as it sounded 15 years ago.

My rule of thumb is, if money is involved, you can be guaranteed that some form of manipulation is going on, from politics, to business, and religion. The elections are manipulated, the business market isn’t free, and the congregation is told what those in power want to be told.

As a side note, I often view Hollywood as a harbinger of sorts, being the propaganda mouthpiece of those in power, and while watching previews before Blade Runner 2049 (Hypnotoad says go see it) I noticed three different movies or TV series being promoted on war valor. Usually they know something we don’t.

/rant

 

[austinEV]

I hope the 'bulls' on this board are right. I am betting on it (gentleman's bet of course). However, the news of the 'firings' has created some cognitive dissonance for myself. The timing of firing 1 to 2 per cent of your workforce, when things should be growing exponentially is strange to say the least. The fact they they all happened at once, also sits a bit unwell. Maybe someone who has worked as a CEO can pipe in. Is this actually common? I read of layoffs all the time, but 'firings', not so much.

A company that is growing quickly absolutely must do this sort of culling. If a department hires 20 people, they do their very best to hire great people. But things don't always work out. 5 will work out to be superstars, 12 will be solid contributors and 3 will be hiring mistakes. Toxic personality, unreliable, etc. They will need to have an annual cull as long as they are still growing. Once you go steady state with the size then such culls can get cruel after you run out of legit bad hires, but they are no where near that point yet.

 

[TrendTrader007]

So after months of being bearish on TSLA the great trader and legendary chartist Dan Zanger has turned bullish on TSLA and believes that TSLA is forming a small base ready to launch up on ER with a TBA $360
Dan Zanger for those who don't know is the absolute top technical trader in the world and one of the all time greatest traders on the entire history of stock market trading. I don't have enough words to praise his expertise
This is a highly thrilling news to me!
Shorts r in deep deep trouble!!!

 

[vgrinshpun]

So after months of being bearish on TSLA the great trader and legendary chartist Dan Zanger has turned bullish on TSLA and believes that TSLA is forming a small base ready to launch up on ER with a TBA $360
Dan Zanger for those who don't know is the absolute top technical trader in the world and one of the all time greatest traders on the entire history of stock market trading. I don't have enough words to praise his expertise
This is a highly thrilling news to me!
Shorts r in deep deep trouble!!!

Can you clarify what "TBA $360" means?

 

[austinEV]

Can you clarify what "TBA $360" means?

Buy at 360 maybe. 360 has been resistance. Top of the ascending triangle. It is an obvious break out level to pick.

 

[vgrinshpun]

Buy at 360 maybe. 360 has been resistance. Top of the ascending triangle. It is an obvious break out level to pick.

Yea, that is my best guess as well, but am not clear what exactly "TBA" stands for in this context.

 

[WarpedOne]

What TBA stands for is TBA ... To Be Announced ....

 

[AlMc]

Yea, that is my best guess as well, but am not clear what exactly "TBA" stands for in this context.

Good question. Googled it and found this which does not pertain to the question but is TBA defined in financial terms:

What does TBA stand for in finance?
To be announced (TBA) is a phrase used to describe forward mortgage-backed securities (MBS) trades. ... The securities are announced 48 hours prior to the established trade settlement date.