2017 Investor Roundtable: TSLA Market Action

[vgrinshpun]

Availability of shares for shorting at Fidelity data suggest that yesterday some short sellers saw as an opportune time to close some of their positions, as data combined with review of the SP chart suggest that yesterday could have been a net covering day (insert your favorite disclaimer here)

It seems that Fidelity anticipates high demand for borrowing, as the availability of shares today is highest since April 21st.

 

[ev-enthusiast]

@vgrin thanks again for sharing the daily information on availability of shares for shorting at Fidelity.
Much appreciated!

 

[Drax7]

I'm very confused by this India thingy and it apparently weighed on TSLA somewhat

Why is India placing restrictions at all on tesla selling cars in India? Factory or parts sourcing seems excessive.

Why not just let their consumers buy one if they want one

Sheesh

Has anybody ever made money at selling anything in India?

 

[ValueAnalyst]

I expect Brent oil, which affects gasoline prices in the US, to rise substantially in the next six months.

I expect this to cause avg gas prices to rise above $3 per gallon by the end of 2017.

Note that each $1/gallon increase in gas prices effectively lowers BEV prices by $2,500 over a five-year avg ownership period.

After federal tax-credit, fuel savings at $3/gallon, and lower maintenance costs, effective Model 3 price comparable to 3-series is $20,000.

And this is before any savings for value of time saved not driving and before any income owners will generate through Tesla Network.

I don't expect Tesla to be able to meet demand for Model 3 for years.

 

[elasalle]

I expect Brent oil, which affects gasoline prices in the US, to rise substantially in the next six months.

I expect this to cause avg gas prices to rise above $3 per gallon by the end of 2017.

Note that each $1/gallon increase in gas prices effectively lowers BEV prices by $2,500 over a five-year avg ownership period.

After federal tax-credit, fuel savings at $3/gallon, and lower maintenance costs, effective Model 3 price comparable to 3-series is $20,000.

And this is before any savings for value of time saved not driving and before any income owners will generate through Tesla Network.

I don't expect Tesla to be able to meet demand for Model 3 for years.

Is this factoring in the ability of US Shale producers to pump up their volume & also US deciding to sell some of their oil reserves?

 

[ValueAnalyst]

Is this factoring in the ability of US Shale producers to pump up their volume & also US deciding to sell some of their oil reserves?

Yes. US oil rig count will flatten around 1,000 for the next 3-6 months depending on price action from hereon, "rig productivity" has already flatlined and started to decline erasing the improvement over the last twelve months (due to high-grading) in just the last month, Bakken and Eagle Ford have peaked, Permian is the only source of growth for 2017 but will underwhelm expectations due to limited well completions driven by limited frac crews and limited takeaway capacity as well as increasing depletion rates for unconventional wells due to longer laterals and higher well interference, ex-US oil rig count still at rock bottom, global conventional production decline rates still high and depletion rates have increased substantially, OPEC extending cuts 6-9 months, demand will jump 1.2-1.5 mbd from 2Q17 to 3Q17, oil "glut" will decline at a rate of 1.5-2.0 mbd in 3Q17 depending on OPEC compliance rate which I expect to decline from 100% to 50% by the end of 3Q17.

 

[WhiskeySauer]

Ben Kallo is reinforcing his Bull Case. Aligns with TT007's predictions & Andrea James from back in the day.

"We continue to believe a successful Model 3 launch will be an inflection point for stock, and recommend owning shares into the launch. In this note we outline a path to a >$500 TSLA share price, which we believe is feasible if management achieves its stated targets. Additionally, we discuss some of the unique characteristics of TSLA, including increased investor interest, brand recognition, and talent attraction. TSLA remains a top pick with further growth upcoming.”

Fred also pointed this out: "Kallo is one of the top-ranked analysts on Tip Rank: #729 out of 4560 with a 56% success rate and 6.7% average return. He has one of the most extensive histories of coverage on Tesla:"

Here is one of my favorite videos of Ben Kallo, where he debated Mark Spiegel back in Feb:
Tesla Model S and Model X growth stories are 'over,' portfolio manager says

Original Article: Tesla’s stock (TSLA) could surge to over $500 with a successful launch of Model 3 production, says Baird

 

[Reciprocity]

Is this factoring in the ability of US Shale producers to pump up their volume & also US deciding to sell some of their oil reserves?

One thing that is happening is the Saudis are trying to pump up the price ahead of the Aramco IPO. I dont know what the timing of that is and I dont know how long term the impact from that will be, but if the economy can heat up even just a little bit, that will continue to drive the price of oil up. Same goes for the dollar since oil prices are traded in dollars, the value of the dollar will impact the price and the value of the dollar should go down as the economy approves as people look for less of a safe haven investment.

 

[vgrinshpun]

...and they are gone. I doubt that almost quarter million shares were borrowed in the span of 16 minutes (but if there were, that would be a record since I started accumulating data back in September of last year.) It is more likely that Fidelity found a better use for these shares and the are no longer available. In any event, this seems to be a very unusual activity...

 

[TrendTrader007]

MS analyst on CNBC claimed Waymo will be worth $70B and challenge TSLA
I disagree
TSLA is the top dog in the race to autonomy and there is no competition it's a virtual monopoly
Chances are TSLA will be worth over $70B before 2017 is over
I don't how high SP will go but certainly pretty high and definitely much higher than current SP before the year is over

 

[WhiskeySauer]

MS analyst on CNBC claimed Waymo will be worth $70B and challenge TSLA
I disagree
TSLA is the top dog in the race to autonomy and there is no competition it's a virtual monopoly

It's also worth noting that the valuation is based on the assumption that Waymo can achieve 1% market share of the mobility-as-a-service market by 2030. I see no reason why Tesla wouldn't be capable of achieving a 1% market share, either. All of this fits in line with the white paper produced by ARK invest, which stated that investors are probably dramatically underestimating the present value of all these autonomous driving efforts.

 

[ValueAnalyst]

Here is one of my favorite videos of Ben Kallo, where he debated Mark Spiegel back in Feb:
Tesla Model S and Model X growth stories are 'over,' portfolio manager says

It's not surprising that Mark hasn't put up this CNBC clip on his Twitter page...

Given his level of emotional attachment to his position, I'd be very concerned (genuinely) for his wellbeing if TSLA squeezes shorts.

 

[The Blue Owl]

TSLA is the top dog in the race to autonomy and there is no competition it's a virtual monopoly

From the point of view of cars on the road and data collection today, maybe. But it would be a mistake to discount the competition. Even though big auto is still only begrudgingly dipping its toes in the electric waters, when it comes to autonomous driving they are hell bent to make it work. There is also no shortage of very talented teams working on this outside of the established car makers, and they are really making progress.

Discounting the competition would be the same mistake that my friends make all the time when it comes to Tesla: "but they only sell as many cars in a year as Toyota sells in a week!". Competitors are behind Tesla today, and Tesla will hopefully maintain its leadership position, but they won't have this all to themselves forever.

(I am not challenging your TSLA market cap predictions -- I don't have a prediction of my own, except that it will continue to grow in the long term.)

 

[ValueAnalyst]

One thing that is happening is the Saudis are trying to pump up the price ahead of the Aramco IPO.

Do you have any evidence of this motivation, or is this your opinion?

 

[TrendTrader007]

Yesterday was a bear trap
Shorts got suckered in
TSLA goes higher from here

 

[Reciprocity]

Do you have any evidence of this motivation, or is this your opinion?

Reported this morning on Fox Business Channel and it makes sense. Why else would the Saudis want to cut production coincidentally around the time they are going public. I dont recall who the analyst is but it makes sense based on how the pricing has gone from high 40's to over 50 in just a couple of weeks?

 

[TrendTrader007]

Waymo does not have Elon Musk
That's what most analysts don't seem to get
Competition does not have EM
And that makes ALL the difference
My $10 million bet is not on Tesla
It's on Elon Musk

 

[Capn Bob]

Great to see you posting on these threads, WhiskeySauer. For those that don't know, he's been doing sterling work on Tesla Motors (Tesla, Inc) • r/teslamotors fighting the bears and trolls in the trenches with extremely well thought out arguments and analyses. Hope you'll be posting here more often, these investor threads would really benefit from more of your sage input.

Admittedly I'm not much of a poster myself, still have a lot to learn, so I'm now going to become a TMC supporting member to redress the balance a bit.

 

[doctoxics]

Yes. US oil rig count will flatten around 1,000 for the next 3-6 months depending on price action from hereon, "rig productivity" has already flatlined and started to decline erasing the improvement over the last twelve months (due to high-grading) in just the last month, Bakken and Eagle Ford have peaked, Permian is the only source of growth for 2017 but will underwhelm expectations due to limited well completions driven by limited frac crews and limited takeaway capacity as well as increasing depletion rates for unconventional wells due to longer laterals and higher well interference, ex-US oil rig count still at rock bottom, global conventional production decline rates still high and depletion rates have increased substantially, OPEC extending cuts 6-9 months, demand will jump 1.2-1.5 mbd from 2Q17 to 3Q17, oil "glut" will decline at a rate of 1.5-2.0 mbd in 3Q17 depending on OPEC compliance rate which I expect to decline from 100% to 50% by the end of 3Q17.

What impact would recent shale oil development in Argentina have on your scenario? Not sure that OPEC can control World oil prices with fracking now viable at $40/barrel oil.

 

[ValueAnalyst]

Reported this morning on Fox Business Channel and it makes sense. Why else would the Saudis want to cut production coincidentally around the time they are going public. I dont recall who the analyst is but it makes sense based on how the pricing has gone from high 40's to over 50 in just a couple of weeks?

I recognize that this is the rhetoric on media and that such motivation would help Aramco price the IPO higher.

These two facts alone, however, are not enough to conclude that they are actively trying to raise oil prices to benefit the Aramco IPO.

After having researched oil market fundamentals extensively over the last 18 months, I believe that OPEC is needed to prevent very extreme ups and downs (more than what we have experienced) in oil prices primarily caused by the inelastic demand curve.

I do think OPEC cuts are needed in 2017 in order to prevent $200+ oil in 2020 and beyond.