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Agreed. @FredTMC would have nailed it with his prediction for yesterday but the JB interview put it off a day.
Just set up an April 7th strangle just in case it is pushed out . Only 10 contracts of each. ( 220 put/270 calls). This allows for catching the delivery numbers for Q1 just in case no Cap Raise is imminent
bear trap?... markets look like crap... oil plunging as expected... rates rising... tsla searching for cash... bullish analysts predicting paltry M3 outputs which is totally confusing... it either bounces here or plummets.
funny thing is... it's currently trading within 1% of the Aug 2015 cap raise after essentially a replica setup.
Careful, or you'll fall for the short fallacy. Here's the current fairy tale being read by short-sellers to their kiddies every evening. Once upon a time, there was a volatile stock called TSLA that traded within a 180 to 280 range. It has hit the 280 end and is now backtracking to 180, where reasonable analysts like Colin Langam and that genius over at Goldman-Sachs value the stock. Anything above 180 is pure exuberance. The end.
The problem with the fairy tale is that it doesn't take into account the pending arrival of Model 3, and it doesn't take into account how the on-time spin-up of the gigafactory will positively affect GMs. It doesn't take into account the de-risking with a cap raise taking place so close to the beginning of Model 3 production.
So, do you bet your money on the fairy-tale or on data that suggests Model 3 and the gigafactory are going to send the stock upward in 2017?
I'm betting my money on the "fairy-tale". The current market cap of $39.5 billion has the Model 3 launch and gigafactory priced in. The current market cap is not for a car company that makes 80,000 cars. On Feb. 28, 2014, just over 3 years ago, the stock was $244.81. So anyone who owned the stock three years ago and has held has received no reward for taking on a lot of macro and company risk. The X and S are pretty high margin products for Tesla. I'm not so sure on the solar, battery and model 3. I'm planning on buying back in sub $200.
Hmm, maybe I should tell the uncensored version of the fairy tale. It begins with the same 180-280 trading range expectations, but then there's a twist. A number of shorts believe feverishly that Musk will be unmasked someday, and when that day arrives, TSLA will fall to $0 and the short-sellers will dance in the streets. There would be this special segment on CNBC where the prime visionaries of Tesla's collapse are gathered together to celebrate this moment. There's Cory Johnson of Bloomberg, Jim Chanos, Cramer, and Mark Spiegel sitting in a row, basking in the glory with an image of a cardboard city and the words "Potemkin Village" in the background. Suddenly, none other than Warren Buffett enters the camera view, and he is wearing a magnificent crown, jeweled with more diamonds than one can count.
"Today I pass along my crown as King of the Financial Oracles to one of you, the most deserving one," says Buffett.
His eyes scan the contestants, and they all perk up, longing to receive such prestigious recognition. As Buffett's eyes fall upon Spiegel, something amazing happens to the Tesla critic. It is like he is catapulted out of his reality into another world entirely. The light is gone, he cannot see the others beside him. He starts to recognize little features in the dimness, features that resemble those in his own room at home. Glancing at his phone's stock app shows TSLA trading in the mid 240s and he is still underwater. His clothes look strikingly like pajamas to his tired eyes, and the recognition slowly descends upon him that this was all just a dream.
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racer26
Active Member
I don't think anybody that has their head screwed on straight will disagree with you that a valuation of approximately 40B has a certain amount of Model 3 and gigafactory success priced in. You're absolutely right that 3 years ago, when there was still significant risk that Model S might be a fad, Model X was being delayed and Model 3 nowhere to be seen, that being at this price was too much, and quite overpriced.
That being said - Tesla is currently selling somewhere in the neighborhood of 10B worth of cars per year with margins approaching 30%. A large portion of Tesla's present valuation is justified by that.
The thing is - once Model 3 and gigafactory prove their success, it's right on to the next thing. Model Y, Semi, Pickup, Minibus, Solar Roof and so on. All companies are priced with a certain expectation of future success built in. In Tesla's case, the roadmap to a wide array of products that virtually sell themselves is clear - quite a bit clearer actually, than most companies. We already know what the next 5 or 6 big projects coming down the pipeline are.
Remember - when we started building Model S 5 years ago, we expected to sell maybe 20,000 of them per year at full tilt. Tesla is now selling 3-4x that with sales still climbing. Imagine if initial estimates of demand for Model 3, or any of the other future models, are off by that much.
Can we please balance out this conversation with Ferraris 12 billion market cap against 8k cars delivered in 2016, with ambitious plans to grow it to 9k by 2019. Thanks in advance.
erthquake
Active Member
larmor
Active Member
And the show car ferrari superfast at geneva is all ready slower than a tesla...
Ferrari 812 Superfast lives up to its name
This is similar to my plan, but I start buying shares back at 220 because I think 200 might be the lows this time instead of taking all the way to 180.
Looking forward to market irrationality giving me great buying prices again!
Sudre
Active Member
I felt this mornings under 244 price was a good buy point. Let's see if it works out for a swing trade. Hoping for anything above 250 next week.
racer26
Active Member
larmor
Active Member
Alot of the US market movers are not dealing with power and grid issues seen in other countries. BTW, battery storage will make wind energy much more viable, which is in high use in Texas.
Tesla is a technology company dealing primarily with software, electronics, manufacturing and batteries; the company is far ahead of their competition in electric vehicles, battery energy storage and autonomous driving. Tesla makes the best cars ever made. Growth is at 50 % and is about to go to 70 % or higher. Tesla's addressable market is in excess of 10 trillion dollars. Any discussion of stock price, market cap, other valuations or comparisons with other companies must consider the above facts.
Waiting4M3
Active Member
It's as if someone plugged a bunch of Powerpacks into TSLA and dampened the price fluctuations
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