2017 Investor Roundtable: TSLA Market Action

[HG Wells]

Starting up a new line always look like nothings going to work.
Then you find and solve one problem after another. It's always the same. It never goes perfect.


Think of how much worse it could be.

"MAJOR CEO FALLS OFF ROOF IN A DRUNKEN STUPOR"
OR
"FIRE STARTS ON ROOF AND SPREADS"
OR
"HANGOVER CAUSES CEO TO BREAK QUIET PERIOD BY BREAKING WIND"

 

[Sammyzuko]

Ford just posted another quarter w/ billions in profit... Tesla is about to post another quarter of hundreds of millions in losses... the reason why this stock is so high is because the M3 is supposed to be the "second coming"... and it's late... bottlenecked... and now they're ramping down future vendor orders...

it's not fine if the M3 simply does "eh... ok"... it has to completely blow our minds to justify this valuation... it had to happen as Elon had earlier predicted... and it's not blowing our minds... it's following through just as expected... slow... with issues... and it's becoming very apparent that 2017 will be a wash and 2018 will be drastically less than stellar.

$320 is bullshit for this stock at this point.

Shhhhhh.....that's not what people want to hear.

 

[elasalle]

If everything bad is accounted for prior to earnings, then earnings will be good/as expected

 

[Paracelsus]

@MitchJi - just wanted to wish you all the luck getting your position filled at these prices. You took a bit of a beat down on this board when you suggested we might see TSLA below 320 around the November time-frame..........and yet here we are. Congratulations on a good call, and good luck!

 

[SBenson]

NASDAQ up 1% but TSLA down 2.5%. This tells us a few things. Market is woefully behind us. We thought 3k/wk is positive because we are coming from a much worse/unpredictable perspective, which Mr.Market was apparently not aware at all.

I also think the risk is to the downside in terms of further delays. Note that the 3K/wk supplier rate is also a prediction, just the same way the earlier 5k/wk rate was also a prediction. Nobody knows if they will hit that prediction, at least until the line is actually moving. Currently the line is entirely stalled based on VIN sightings. So all in all when market discovers that the production is much worse than the news implied, stock price could further tank.

People who are holding out some firepower might find some good deals.

On a related note, each season we seem to get a go-go bull-troll of our own. JC utterly polluted these threads in the X era, pushing people to make ever crazier bets. This time around we got TT. Moral of the story, don't fall for the trolls.

 

[myusername]

200 MA is $316.76... if it breaks... you know.

 

[dc_h]

Not to be negative, but the 8th Circle is Fraud. I wonder if that is a shot at bears as well?

Wow, probably not a mistake from such a well read guy with photographic memory. It sounds like he is saying, sorry, yes I was overly optimistic again, but here I am paying for my sins. It was a fraud of optimism and good intentions, not malicious or intentional.
Hopefully this also is the final big issue to get everything moving. It sounds like the new pack assembly has been challenging. Some simple skeptics mock the "simple" welding problems in the pack, but I think the pack assembly is probably closer to alien dreadnought than any other element of production today. They are firing out batteries faster than bullets and need to assemble packs with a ~1000 batteries at a rate of 5000 a week, just for TA, and hopefully at least as much for TE, and that rate needs to double by the end of 2018.

 

[DurandalAI]

Why not use the sleeper cab on the Tesla semi?

Honestly I’m surprised there isn’t a nice RV trailer sitting outside each location for Elon to camp out in if he wants. It’s what I would do.

 

[Snapdragon III]

I was very excited when I read about the Taiwanese parts order, thinking 10k a week by June sounds great. I just looked again, and It looks to me from the Google translate, that it is 10K per month, not per week. That is not nearly as exciting.

 

[mongo]

Wow, probably not a mistake from such a well read guy with photographic memory. It sounds like he is saying, sorry, yes I was overly optimistic again, but here I am paying for my sins. It was a fraud of optimism and good intentions, not malicious or intentional.
Hopefully this also is the final big issue to get everything moving. It sounds like the new pack assembly has been challenging. Some simple skeptics mock the "simple" welding problems in the pack, but I think the pack assembly is probably closer to alien dreadnought than any other element of production today. They are firing out batteries faster than bullets and need to assemble packs with a ~1000 batteries at a rate of 5000 a week, just for TA, and hopefully at least as much for TE, and that rate needs to double by the end of 2018.

Or a supplier was saying everything is fine... until it was revealed that it wasn't.

 

[Waiting4M3]

Hell

Me too. Just went all in with June $340's and J19 $350's.

No, this time they are on time:
......, and there need to be some penalties for anyone, internally or externally, who does not meet that timeframe.

Me 2, put in rest of my 30% portfolio into J19 $390s in this latest dip, mostly yesterday.

BTW, do you all think when he says there needs to be some penalties internally, does this correspond to the firing? I imagine not since SolarCity firing also happened at the same time, and those couldn't be related to the M3 ramp.

 

[Waiting4M3]

If I remember correctly Buffalo GigaFactory was supposed to be up and running by end of year. hasn't happened yet ? No news these days on this front.

 

[EinSV]

I also think the risk is to the downside in terms of further delays. Note that the 3K/wk supplier rate is also a prediction, just the same way the earlier 5k/wk rate was also a prediction. Nobody knows if they will hit that prediction, at least until the line is actually moving. Currently the line is entirely stalled based on VIN sightings. So all in all when market discovers that the production is much worse than the news implied, stock price could further tank.

People who are holding out some firepower might find some good deals.

I agree with the bolded language. If we have another month or six weeks in delays the fear factor could increase and we may see better buying opportunities ahead unless Semi, TE or other news overwhelms Model 3 jitters. Visible signs of a ramp to the thousands/week level could come sooner than that but I am adopting a "rather be pleasantly surprised than bitterly disappointed" attitude.

On the flip side, low expectations may be a positive sign for a post-ER bounce.

Edit: Now that I have that out of my system, I converted a few shares into J19 LEAPs.

 

[luvb2b]

volume this morning is fairly light running about 1.5x avg daily pace. the hedge pressure from options expiring today should have been absorbed by now. the s&p just broke sharply higher and leveraged etf buying in the indexes should be in play later today. all we need is a little stability and a test of the day high, thinking we could trade back to 325+ today.

if the producer was delivering 5k parts/weekly for october november, tesla would *have* to reduce supply in the near term because they will be temporarily be far oversupplied.

i guess a different way of saying it is that if you knew tesla was ordering 5000 parts a week october and november, given what we have seen for output so far in october, you would also know they were more than adequately supplied for whatever reasonable december scenario (including 5k/weekly the whole month).

order cuts would be a logical move to manage accounts payable, not necessarily indicative of a reduced exit rate in december.

two other things to note from a trading standpoint: a huge number of 320 calls expiring today will create meaningful selling pressure at the open. in fact, if i were a large short who wanted to cover this morning, i would do it by selling first, pushing the stock under 320, and covering against the options hedge flow. so look for a surge lower in the morning to possibly establish a short term low.

the second thing is that the qqq will be up huge, and there will likely be forced buying late if the market stays up throughout the day. this may help tesla later in the day once the hedge pressure has faded.

 

[Waiting4M3]

Semi reveal is at SpaceX?

Assuming the semi is being built and tested at Fremont, how is it going to get up to Nevada or down to SpaceX without being sighted?

 

[mongo]

Assuming the semi is being built and tested at Fremont, how is it going to get up to Nevada or down to SpaceX without being sighted?

Oh, it has ways...

More than meets the eye...

 

[mickificki]

Oh, it has ways...
View attachment 256448
More than meets the eye...

MY 3 YEAR OLD WOULD LOVE LOVE LOVE THAT!!!

 

[ZsoZso]

200 MA is $316.76... if it breaks... you know.

Oh, its better than that, My Master!

Did you see the daily minimum: $316.66
Doesn't get any more perfect than that, triple sixes!
You nailed this pattern perfectly!

 

[AlMc]

I was very excited when I read about the Taiwanese parts order, thinking 10k a week by June sounds great. I just looked again, and It looks to me from the Google translate, that it is 10K per month, not per week. That is not nearly as exciting.

Can we get a second opinion on this. IT is a significant difference

 

[Waiting4M3]

Can we get a second opinion on this. IT is a significant difference

It's definitely per week, original text says "每周1萬", "每周" means every week, "萬" means 10,000.

Also "原訂12月起每周5,000套零組件的供貨水位" means initially they targered weekly 5,000 pace in Dec. It's very clear, no misunderstanding here.