2017 Investor Roundtable:General Discussion

[myusername]

Those are quarterly revenue values. Updated original post to make it clear.

With 500k cars TSLA will be in the same order of magnitude in terms of revenues (and almost in terms of deliveries) as BMW (and we are talking of a timeframe of 9-15 months).

The difference will be that one company is pushing 100% y/y growth and the most modern tech stack on the market while the other is flat and working on a fleet which is 90%+ old technology and will need to be decommissioned/transitioned.

How about I invest 100$ on TSLA and you put 100$ on BMW and we check in 10 years. Would you confidently take that bet? Not many people would and that's why the market cap is the same.

please see my post to your first... it's an order of magnitude... just not "the same"... if Tesla sold 500k/yr... then Tesla would be 1/5th the size of BMW... and all they have to do is manage to wade through a year of massive growth risks... and they just fell down on step one.

you see how crazy this is? you're paying for a BMW today that is currently 1/25th BMW today.

 

[Gtoffo]

please see my post to your first... it's an order of magnitude... just not "the same"... if Tesla sold 500k/yr... then Tesla would be 1/5th the size of BMW... and all they have to do is manage to wade through a year of massive growth risks... and they just fell down on step one.

you see how crazy this is? you're paying for a BMW today that is currently 1/25th BMW today.

No I'm paying BWM price for a company what I think will be 1/4th of BMW (don't forget X & S) in 9-15 months AND growing 100% y/y AND pushing the most advanced and future proof tech on the market.

And that's forgetting everything about all the other products TSLA can tap into.

Doesn't sound crazy at all to me. Below those levels I'm a buyer.

EDIT: I mean: AT or BELOW those levels I'm a buyer. I think any price below 300$ is a bargain.

 

[3Victoria]

Bit confused with the Tsla and the Panasonic earning call. Panasonic said that cell production was a bottle neck at GF1.
So are both cell production and pack production bottlenecks?

Hopefully it’s just pack production. I trust EM and team to address the issue more effectively and quicker than any other company on earth.

Was getting impatient for my M3 so test drove the MX. It’s an awesome car. Would have upgraded if the stock moved the other way after earning.

Panasonic said that they were going to ramp up cell production *because* battery-pack assembly was getting fixed soon. Same story from Tesla. There is no problem with battery cell production.

 

[defc0n]

Intel acquired Mobileye for about 15 billion. Although I believe they overpaid, that's what the market now believes that level of car autonomy is worth. Most would probably believe Tesla, with their software now approximately at parity with Mobileye, should have 15 bil of market cap in AI tech alone, quite possibly more. Solar city was at around 3 bil market cap at acquisition. 50 bil shouldn't seem too far fetched for bears given everything else Tesla has. Brand name, energy, software, engineering talent all certainly have meaning.

At 50 bil I'm not that scared. That goes without saying Tesla needs model 3 production to come online fairly quickly with all its spending, but I see no reason why it shouldn't in the upcoming quarters.

BMW is looking pretty at this exact moment in time, but the market hasn't seen enough preparation for their future.

 

[RobStark]

Tesla has achieved delivery and Revenue growth by expanding geographically to ever thinner, ever more remote, and ever more expensive (for SG&A) markets, i.e. Mexico, Portugal, UAE, South Korea, Malaysia(?) etc.--will Taiwan be next?

The dumbest of a dumb post.


South Korea is a wealthy country and the 5th biggest luxury car market in the world.

Tesla is not in Malaysia.

But is in Taiwan. 3 Stores. Portugal One Store. UAE one store. Tesla doesn't do paid marketing campaigns. These are wealthy countries that will bring very good ROI.

Mexico. 85% of luxury cars are purchased by three cities; Mexico City,Guadalajara, and Monterrey. Tesla only needs 3 Mexico City stores although it currently only has one, plus another in Monterrey and Guadalajara. Tesla Mexico also intends to open a store in Cancun were Mexico's elite spend their summers. Kinda like the Hamptons.

Mexican supercharger Network will also serve Americans on vacation. As Portuguese Supercharger Network serves wealthy Northern Europeans on vacation. Those Superchargers would be needed even if Tesla did not sell locally. Having local Tesla service centers also brings peace of mind when on vacation.

 

[Gtoffo]

I'm not following your math. I think you are comparing a quarterly number (28.4B) to an annual number (20B).

BMW sells on the order of 2.5 million vehicles a year.

The numbers aligned oddly 20B Quarterly vs 20B annually so my point was lost a little bit. Edited the post to clear things up a bit.

My point is I think they will be in the same league in 9-15 months once M3 will be up and running. Not the same but TSLA will be 1/4th the size and growing substantially so worth much more.

 

[Rarity]

Those are quarterly revenue values. Updated original post to make it clear.

With 500k cars TSLA will be in the same order of magnitude in terms of revenues (and almost in terms of deliveries) as BMW (and we are talking of a timeframe of 9-15 months).

Again, not following your math. BMW has annual revenues of $100 billion+. It will be a few years before Tesla overtakes BMW in terms of revenue.

100,000 x $100k = $10 billion (S & X)
400,000 x $40k = $16 billion (3)
Total S, X, and 3 = $26 billion

 

[myusername]

Intel acquired Mobileye for about 15 billion. Although I believe they overpaid, that's what the market now believes that level of car autonomy is worth. Most would probably believe Tesla, with their software now approximately at parity with Mobileye, should have 15 bil of market cap in AI tech alone, quite possibly more. Solar city was at around 3 bil market cap at acquisition. 50 bil shouldn't seem too far fetched for bears given everything else Tesla has. Brand name, energy, software, engineering talent all certainly have meaning.

At 50 bil I'm not that scared. That goes without saying Tesla needs model 3 production to come online fairly quickly with all its spending, but I see no reason why it shouldn't in the upcoming quarters.

BMW is looking pretty at this exact moment in time, but the market hasn't seen enough preparation for their future.

mobileye was/is a producer of computer hardware for autonomy... Tesla is a consumer of computer hardware for autonomy... this is not the same...

SolarCity is dragging Tesla down... not a valuable asset.

Tesla is a 100k/yr auto company w/ ~$10b in revenue... valued today as auto companies are... it'd have a market cap of $9b or less. Instead it's trading as if it had $80b or more in revenues... it will take Tesla 5 years or more to get to that point... and that does not include things like "whoops... we just completely missed that quarter"... and "whoops... it's the year 2021 and there's about 20 other equivalent choices to our cars now"...

so if you expect a rise in SP from here... then you assume that Tesla will scale to greater than 1.5m/yr and then double that before any other manufacturers crush them.

 

[Starno]

Tesla is a one factory 100k/yr company .

Yes.

And could you remind me how much cars were they producing 5 years ago ?

Exactly.

 

[Gtoffo]

Again, not following your math. BMW has annual revenues of $100 billion+. It will be a few years before Tesla overtakes BMW in terms of revenue.

100,000 x $100k = $10 billion (S & X)
400,000 x $40k = $16 billion (3)
Total S, X, and 3 = $26 billion

Yes. In 9-15 months. That would mean another year of 100% growth rate y/y.

It would make them 1/4th of BMW but growing at an astronomical rate and looking to keep growing while BMW stagnates (0.4% growth rate Y/Y !!!) and produces old tech.

That's why I'm a buyer.

EDIT: OK guys....my real bull thesis is "ELON" but whatever....I'm enjoying pretending to have other reasons as well.... :-D my cost basis for TSLA is around 40$ so this pullback feels like a fun ride down hater's lane to me. Stay long and prosper.

 

[defc0n]

mobileye was/is a producer of computer hardware for autonomy... Tesla is a consumer of computer hardware for autonomy... this is not the same...

SolarCity is dragging Tesla down... not a valuable asset.

Tesla is a 100k/yr auto company w/ ~$10b in revenue... valued today as auto companies are... it'd have a market cap of $9b or less. Instead it's trading as if it had $80b or more in revenues... it will take Tesla 5 years or more to get to that point... and that does not include things like "whoops... we just completely missed that quarter"... and "whoops... it's the year 2021 and there's about 20 other equivalent choices to our cars now"...

so if you expect a rise in SP from here... then you assume that Tesla will scale to greater than 1.5m/yr and then double that before any other manufacturers crush them.

You believe intel paid Mobileye 15 bils for their hardware? Hardware is the easy part. Tesla energy is becoming quite a source of revenue, and you always ignore it. The market doesn't ignore future growth in its calculation, but you seem to.

 

[sundaymorning]

@myusername if you think bmw is such a great company, what are you wasting your time here for? Go pour your money in Bummer, start your own BummerMotorsClub and see how many fans you get. BTW does Bummer have a CEO capable of launching rockets? Forgetting about reusable rockets, just tell their CEL to launch one single rocket and it would be enough to convince me they’re capable of doing great things. Sorry bud, but Bummer isn’t getting a dime from my portfolio, they’re just so 1990s. No one marvels at bummers anymore, get with the program.

 

[myusername]

Again, not following your math. BMW has annual revenues of $100 billion+. It will be a few years before Tesla overtakes BMW in terms of revenue.

100,000 x $100k = $10 billion (S & X)
400,000 x $40k = $16 billion (3)
Total S, X, and 3 = $26 billion

now considering that won't happen next year... that means it might in 2019... but they just disclosed another Elon timeline of 3 years until factory in China... that means earliest it comes online is beginning of 2022... my guess is:

2018: 200k
2019: 350k
2020: 500k
2021: 600k
2022: 800k
2023: 1m
2024: 1.2m
2025: 1.7m

but by 2020... most auto companies will have already scaled out competition and the numbers above will be deflated... and Tesla will never reach the size of BMW.

and by 2020... after the reality that Tesla is an auto company sinks into real financials... not these story plots... Tesla will be trading for a P/S of 2 or less... or $220 or less.

 

[myusername]

@myusername if you think bmw is such a great company, what are you wasting your time here for? Go pour your money in Bummer, start your own BummerMotorsClub and see how many fans you get. BTW does Bummer have a CEO capable of launching rockets? Forgetting about reusable rockets, just tell their launch one single rocket and it would be enough to convince me they’re capable of doing great things. Sorry bud, but Bummer isn’t getting a dime from my portfolio, they’re just so 1990s. No one marvels at bummers anymore, get with the program.

i'm not the one that started the BMW comparison... we can pick any auto company... and it'd tell the same story... but it'd be even worse.

 

[sundaymorning]

i'm not the one that started the BMW comparison... we can pick any auto company... and it'd tell the same story... but it'd be even worse.

Of course you didn’t, you’re much to smart for that. Everyone here knows Tesla is already outselling Bummers 7 series, Oldies (Audi) A8 and Panamaras in the US combined we also know that BMW sales are down 25% without a single M3 sold, I wonder what’s gna happen when Tesla ramps M3?

 

[myusername]

Yes.

And could you remind me how much cars were they producing 5 years ago ?

Exactly.

and look how easy that was... now they just need to go from 100k to 2.5 million and finally your stock will be reasonably priced at today's value.

 

[defc0n]

and look how easy that was... now they just need to go from 100k to 2.5 million and finally your stock will be reasonably priced at today's value.

Again all you care about is automobile sales.

 

[Gtoffo]

and look how easy that was... now they just need to go from 100k to 2.5 million and finally your stock will be reasonably priced at today's value.

Only if their growth rate will be 0% y/y at that point just like BMW and working on old tech without a future.

Which I don't think it will be so it will be substantially higher than that.

 

[ggr]

Again, not following your math. BMW has annual revenues of $100 billion+. It will be a few years before Tesla overtakes BMW in terms of revenue.

100,000 x $100k = $10 billion (S & X)
400,000 x $40k = $16 billion (3)
Total S, X, and 3 = $26 billion

Tesla doesn't have to exceed BMW's current rate, it just has to drag BMW down to meet them.

 

[myusername]

Only if their growth rate will be 0% y/y at that point just like BMW and working on old tech without a future.

Which I don't think it will be so it will be substantially higher than that.

Tesla will eventually hit this point too... that measly 4% growth that BMW has is greater than Tesla's annual production... you're comparing an apple to an orchard.