2017 Investor Roundtable: TSLA Market Action

[Rarity]

If, as has been surmised, tencent now has somewhere between 15-19% of TSLA, we can expect some highly attractive cost of capital benefits from the domestic China developments.

I don't think anybody has surmised that Tencent now has somewhere between 15-19% of TSLA. We know that they were at 5% and some surmise that it is now somewhere between 5-10%. Tencent would have to file with the SEC that they now have 10%+. They have not yet done so.

Practically speaking, an accumulation to 15-19% in such a short time period would be very difficult to accomplish without a stock price blowout. Essentially, it would look like a true short squeeze.

 

[The Blue Owl]

I think it's more about Macro. NASDAQ is down, and even the stocks showing steady growth those past couple of months : FB, AMAZN,APPL, are down as well.

This probably doesn't help either:


BREAKING NEWS
Puerto Rico is requesting bankruptcy protection, setting up a showdown with creditors owed $73 billion

Puerto Rico and its agencies owe $73 billion to creditors, dwarfing the roughly $18 billion owed by the city of Detroit when it entered what was previously the largest municipal bankruptcy in 2013.​

 

[esk8mw]

I'm guessing we enter earnings today between 310 and 312. We always seem to do this on the day of earnings.

Personally, I'm trying to double my exposure but trying to be patient for the right price.

 

[kenliles]

Interesting timing on this SEC probe news SEC Probes Solar Companies Over Customer Cancellations

"
However, SolarCity representatives sent a statement to the Wall Street Journal saying that the company "has remained focused on reporting the quality of our installed assets, not pre-install cancellation rates. Our growth projections have always been based on actual deployments."
"

SEC probing Tesla's SolarCity divsion and Sunrun

 

[everman]

I'm guessing we enter earnings today between 310 and 312. We always seem to do this on the day of earnings.

Personally, I'm trying to double my exposure but trying to be patient for the right price.

I've got a standing buy in at $312 with my remaining dry powder. Great if I pick it up, if it runs away, I'm fine with that too.

 

[racer26]

Regarding S&P500 inclusion, does anyone know just how much GAAP income TSLA would have to have this quarter to qualify for inclusion? I don't expect them to make this number, whatever it is, I'm just interested. I found SCTY's 10Qs at Company SEC Filings for 10-K Annual Reports and 10-Q Quarterly Reports :: Last10K.com, but I'm not certain that SCTY Q4 2016 before the acquisition was complete is completely reflected in TSLA's Q4 10k, which causes a discrepancy between the total of the quarters versus the annual in the 10K... at least I think that's what's going on. Anyway, here's what I worked out so far:

$M            TSLA    SCTY    both
q1/16         -282    -25     -307
q2/16         -293    -55     -348
q3/16           22     53       75
q4/16                         -121
Total of above                -701
2016 total from 10K           -773

Using the (more conservative) 10K annual, backing out Q1/16, if Q1 comes in with GAAP profit of $466M, I think this would qualify for inclusion. As I said, this is *ahem* unlikely.

But let's assume that Q1 is break-even, and use the 10K number for Q4/16. Then Q2 would only need $46M GAAP profit to qualify. In fact, so long as the total GAAP profit of Q1/Q2 is above about $46M we'd be there. This, I think, is entirely possible, so I predict entry around August/September (have to wait for Q2 10Q to come out), right when (hopefully) Model 3 is really ramping up. Wow.

The number needed to make it with 1Q17 is something like $400M GAAP (which is north of +$2 EPS - its not going to happen, and if it does, holy sugar look out, because the fireworks show is going to be spectacular).

Combined total GAAP of 1Q17 and 2Q17 need only be something like +$150M to make S&P inclusion in 2Q17's ER, since 2Q16 was nearly $300M in the hole.

 

[TrendTrader007]

I'm cool with the action today
Looks like a bear trap in making
We should be up tomorrow

 

[jbcarioca]

I don't think anybody has surmised that Tencent now has somewhere between 15-19% of TSLA. We know that they were at 5% and some surmise that it is now somewhere between 5-10%. Tencent would have to file with the SEC that they now have 10%+. They have not yet done so.

Practically speaking, an accumulation to 15-19% in such a short time period would be very difficult to accomplish without a stock price blowout. Essentially, it would look like a true short squeeze.

Correct, I mistyped. I intended to say 5-9 and typed the other thing by mistake.

 

[TrendTrader007]

Shorts are coming on really strong hoping to depress the stock as much as they can
Post ER Stock could easily jump up like a coiled spring
for what can happen to a heavily shotrted Stock after earnings look no further than FSLR today

 

[Richgoogol]

what do you guys think is the probability of a beat today? im getting kind of nervous as i have an 80% exposure to TSLA, i wonder whether i should sell some before earnings in case things go south..kind of torn, need some advise...

 

[Starno]

Verdict in a few hours

 

[Starno]

what do you guys think is the probability of a beat today? im getting kind of nervous as i have an 80% exposure to TSLA, i wonder whether i should sell some before earnings in case things go south..kind of torn, need some advise...

Beat unlikely. And high jump unlikely as well.

Either stagnate or +3-5% for after ER.

 

[farzyness]

Beat unlikely. And high jump unlikely as well.

Either stagnate or +3-5% for after ER.

What information are you using to come to this conclusion? Wondering.

 

[ValueAnalyst]

I do not expect a May 2013 type short squeeze in the coming days/weeks. The chances of this is small, given the significantly higher daily trading volume.

I do, however, expect a strong rise in SP over the coming months, but I expect it to be orderly and fully supported by fundamentals.

This, in my opinion, is better for the long-term investors. Such a strong, but orderly rise, would reduce the expected volatility in SP, which is positive for the company.

 

[Starno]

What information are you using to come to this conclusion? Wondering.

The fact that I don't see any sign the ER will be negative, which would trigger a beat.
And the market seems too uncertain for a high jump.

But that's just speculation obviously...

 

[tinm]

I'm cool with the action today
Looks like a bear trap in making
We should be up tomorrow

Hmm that almost looks like poetry, and we all know what happens when poetry appears in this thread...

 

[FredTMC]

what do you guys think is the probability of a beat today? im getting kind of nervous as i have an 80% exposure to TSLA, i wonder whether i should sell some before earnings in case things go south..kind of torn, need some advise...

I'm confident of "a beat" today.

In other words, Wall Street consensus estimates are all over the map...but on balance, I fully expect results to be viewed as a "beat" (both Top and Bottom line)

 

[Paracelsus]

I saw something blip across twitter about the recent capital raise notes that convert at $327.50, and that the price may go bonkers if that level is breached.

Can someone explain why that would cause the stock to go up? Wouldn't that be a dilutive event? Sorry for the novice question.

Are we seeing the pull down today in an effort to keep the trading after hours & tomorrow from exceeding $327.50 per @everman post on Monday? This makes sense to me given the beat (and beat down of the shorts) that is only a few hours away

 

[racer26]

The fact that I don't see any sign the ER will be negative, which would trigger a beat.
And the market seems too uncertain for a high jump.

But that's just speculation obviously...

...Thats not how a beat works...

The market expectation is defined by analysts, and for 1Q17 TSLA seems to be around a loss of $0.69 EPS GAAP.

If TSLA reports numbers after market close today indicating a narrower loss than that, or a profit, then that is a beat.

 

[esk8mw]

...Thats not how a beat works...

The market expectation is defined by analysts, and for 1Q17 TSLA seems to be around a loss of $0.69 EPS GAAP.

If TSLA reports numbers after market close today indicating a narrower loss than that, or a profit, then that is a beat.

IB tells me consensus is -0.81/share, FWIW.