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2017 Investor Roundtable:General Discussion

Discussion in 'TSLA Investor Discussions' started by AudubonB, Dec 30, 2016.

  1. sunhelm

    sunhelm Member

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    Thank you for breaking this down. The likelihood of a profitable quarter just edged up a bit for me due to your analysis.

    Question, I know Grohmann engineering acquisition is planned to close by early 2017, do you think it will make a significant expense contribution to 1Q or 2Q bottomline? Hopefully it could be offset by substantial TE sales.
     
  2. MitchJi

    MitchJi Active Member

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    Tesla earnings: Expect Model 3 updates amid record stock highs

    Earnings: Analysts polled by FactSet expect Tesla to report an adjusted fourth-quarter loss of 51 cents a share, narrower than the loss of 87 cents a share it reported in the fourth quarter of 2015.

    Recent quarterly results have been a mixed bag for Tesla: Beyond the third-quarter profit, the company posted an unexpected loss in the fourth quarter of 2015, and alternated between beating and missing market expectations in previous quarters.

    Estimize, which crowdsources estimates from Wall Street analysts, buy-side analysts, hedge-fund managers, company executives, academics and others, has a more optimistic consensus estimate for Tesla, seeing a loss of 3 cents a share, based on 385 estimates.

    Revenue: The FactSet sales consensus is $2.18 billion, which would compare with sales of $1.75 billion a year ago. Estimize contributors on average project sales of $2.25 billion for Tesla.
     
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  3. racer26

    racer26 Active Member

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    #5863 racer26, Feb 17, 2017
    Last edited: Feb 17, 2017
    Simple: 4Q16 GAAP gets to account for 3Q13's deferred RVG revenue which has now expired and is no longer a liability. Non-GAAP accounted for that revenue in 2013, so non-GAAP is unaffected. Tesla choosing to discontinue issuing RVGs at the same time as the oldest ones started expiring has the effect of changing it from the old way, where non-GAAP numbers looked better than GAAP, to the other way around. I expect that because of this change, the GAAP numbers should actually eclipse the non-GAAP now.

    The way RVG revenue was accounted for by GAAP was pretty broken. If you sold a Model S for say $70,000, the RVG was that Tesla guaranteed they would buy the car back in 36-39 months for 50% of the base price plus 47% of option pricing, or something like that. So it meant that selling a car immediately generated a liability of roughly 50% of the price of the car. Since Tesla's margin at the time was only about 15-20%, that made the RVG cars look like they were being sold at about a 30% loss, right off the bat. The way GAAP handled RVGs was effectively like looking at it as though Tesla would buy back every car they issued an RVG on, and then completely ignored the fact that they would then have the car, which still had some value. It made it look as though Tesla would buy them all back and throw them away for $0. The reality is obviously different. The majority of RVG cars held their value (or continued to please their owners) well enough that the owners did not want to exercise the RVG. Even the ones that did, the RVG meant Tesla had to buy the car back, sure, but then it gets turned around and sold again as a CPO, so the real exposure to Tesla is nowhere close to what the GAAP accounting made it look like. This is why Tesla backed it out of the non-GAAP numbers.
     
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  4. racer26

    racer26 Active Member

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    Tesla buys Germany's Grohmann Engineering to help ramp up electric car production

    This article seems to suggest that DBAG expects to get mid-single digit millions of euro for their ~25% stake, I expect Tesla bought Grohmann for ~20M Euro. I expect its small enough it will get lost in the noise.
     
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  5. DurandalAI

    DurandalAI Member

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    I'm not sure I understand the question unless there was a missing sarcasm tag. If you're using full autonomy in the tunnels as a requirement for use, there is no option for rubbernecking/gawking. You zoom by it and wonder what that was all about. lol.
     
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  6. esk8mw

    esk8mw Active Member

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  7. vgrinshpun

    vgrinshpun Active Member

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    As a note to the Electrek article on the 2MWh installation at a PG&E substation, it did not mention quite an important characteristic of this project: it is the first Tesla installation mentioned in press that seem to include stacking of the streams of revenue by including stream generated by operating this BES as a peaker replacement and as a means to defer upgrading substation which due to growth of local load would be required otherwise. This is fairly important as using BES as a way to defer substation upgrades could pay for major part of wholly for installation of BES, making economics of operating in the "peaker replacement" mode a no brainer, as it essentially would provide bonus income.

    Here is relevant quote from the original SFGATE article:

    "Big battery packs can take the place of peaker plants, small fossil-fuel power plants that may only run for a few hours a day. The Browns Valley project may also help PG&E avoid upgrading that substation to handle rising electricity demand in the area."
     
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  8. WarpedOne

    WarpedOne Supreme Premier

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    Hey ppl ... +$6 in two hours, above $272 already.

    What is the rationalization of such madness?
     
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  9. dirtyofries

    dirtyofries Member

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    The stock is volatile. As it has been, so it shall be. Hang on.
     
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  10. T3slaTulips

    T3slaTulips Member

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    I was out for a tasty double cheeseburger. I think that may have been causal.
     
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  11. sunhelm

    sunhelm Member

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    Could it be it's also a ..Warped one?
     
  12. JRP3

    JRP3 Hyperactive Member

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  13. larmor

    larmor Active Member

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    So for estimation purposes: 2016 Q4 is compared to 2015 Q4 or 2016 Q3?
     
  14. mmd

    mmd Member

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    The article says:
    Did the Hawaii project wait till December to install batteries? That project was announced back in Feb of 2016.

    So, it is saying that the powerpack projects exhausted the cell supply from Gigafactory in Dec & Jan.
    Let's make the crazy assumption, that all 600 MWh of Tesla storage installations to date use the cells from GF produced in Dec & Jan. That means, GF is running at 300 MWh/month, or 3.6 GWh/year. It's a far far cry from the 35 GWh/year promised in 2014. This would mean, GF is only at 10% target capacity at best.

    gf_output_prediction.jpg
     
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  15. drinkerofkoolaid

    drinkerofkoolaid Active Member

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    Should probably point out Trump's (support?) for the coal industry is pointless. Coal isn't cost effective. Rather then trying to save a dead industry, that is literally a black spot in every town it thrives, and is horrible for everyone, Trump is ironically encouraging a push back by states to use more Solar.

    While Trump is at it, maybe he should permit the use of Lead in everything, and permit the rebirth of shanty towns.

    The Company Town of Iselin - Mines and Company Towns - Coal Culture Projects - Special Collections and University Archives - Departments - IUP Libraries - IUP
     
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  16. drinkerofkoolaid

    drinkerofkoolaid Active Member

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  17. racer26

    racer26 Active Member

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    And? Its literally been running 44 days. If memory serves only 1 of a planned 8 lines is online yet. The image you post even says 2020 as the target date for that rate.

    Starting to think we need a new index indicator - the @mmd ridiculousness index.
     
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  18. jesselivenomore

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    Wondering if the 4 year service plan starting to run out on early cars will start to improve service margins? Not necessarily for this quarter, but as they add up going forward. I know Elon has stated that they don't want to make a profit on service, but they are already around break even now while honoring the warranty. Any ideas on what service revenues/margin will look like as more and more cars run out of warranty?
     
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  19. SunCatcher

    SunCatcher Member

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    https://investoralmanac.com/2017/02/16/elon-musks-email-to-s...

    Great read!

    Elon Musk;

    "Per my recent comments, I am increasingly concerned about SpaceX going public before the Mars transport system is in place. Creating the technology needed to establish life on Mars is and always has been the fundamental goal of SpaceX. If being a public company diminishes that likelihood, then we should not do so until Mars is secure. This is something that I am open to reconsidering, but, given my experiences with Tesla and SolarCity, I am hesitant to foist being public on SpaceX, especially given the long term nature of our mission.

    Some at SpaceX who have not been through a public company experience may think that being public is desirable. This is not so.Public company stocks, particularly if big step changes in technology are involved, go through extreme volatility, both for reasons of internal execution and for reasons that have nothing to do with anything except the economy. This causes people to be distracted by the manic-depressive nature of the stock instead of creating great products.

    It is important to emphasize that Tesla and SolarCity are public because they didn’t have any choice. Their private capital structure was becoming unwieldy and they needed to raise a lot of equity capital. SolarCity also needed to raise a huge amount of debt at the lowest possible interest rate to fund solar leases. The banks who provide that debt wanted SolarCity to have the additional painful scrutiny that comes with being public. Those rules, referred to as Sarbanes-Oxley, essentially result in a tax being levied on company execution by requiring detailed reporting right down to how your meal is expensed during travel and you can be penalized even for minor mistakes.

    YES, BUT I COULD MAKE MORE MONEY IF WE WERE PUBLIC

    For those who are under the impression that they are so clever that they can outsmart public market investors and would sell SpaceX stock at the “right time,” let me relieve you of any such notion. If you really are better than most hedge fund managers, then there is no need to worry about the value of your SpaceX stock, as you can just invest in other public stocks and make billions of dollars in the market.

    If you think: “Ah, but I know what’s really going on at SpaceX and that will give me an edge,” you are also wrong. Selling public company stock with insider knowledge is illegal. As a result, selling public stock is restricted to narrow time windows a few times per year. Even then, you can be prosecuted for insider trading. At Tesla, we had both an employee and an investor go through a grand jury investigation for selling stock over a year ago, despite them doing everything right in both the letter and the spirit of the law. Not fun.

    Another thing that happens to public companies is that you become a target of the trial lawyers who create a class action lawsuit by getting someone to buy a few hundred shares and then pretending to sue the company on behalf of all investors for any drop in the stock price. Tesla is going through that right now even though the stock price is relatively high, because the drop in question occurred last year.

    It is also not correct to think that because Tesla and SolarCity share prices are on the lofty side right now, that SpaceX would be too. Public companies are judged on quarterly performance. Just because some companies are doing well, doesn’t mean that all would. Both of those companies (Tesla in particular) had great first quarter results. SpaceX did not. In fact, financially speaking, we had an awful first quarter. If we were public, the short sellers would be hitting us over the head with a large stick.

    We would also get beaten up every time there was an anomaly on the rocket or spacecraft, as occurred on flight 4 with the engine failure and flight 5 with the Dragon prevalves. Delaying launch of V1.1, which is now over a year behind schedule, would result in particularly severe punishment, as that is our primary revenue driver. Even something as minor as pushing a launch back a few weeks from one quarter to the next gets you a spanking. Tesla vehicle production in Q4 last year was literally only three weeks behind and yet the market response was brutal."

    Full email: https://investoralmanac.com/2017/02/16/elon-musks-email-to-s...
     
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  20. EinSV

    EinSV Active Member

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    It is a good read, but the email is from 2013: "Date: June 7, 2013, 12:43:06 AM PDT"
     
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