When the dust settles,
-We’re at or within a couple of weeks of sustainable 5K/week
-A Detroit insider who has been harshly critical of Tesla in the past says all versions of the Model 3 not only look to be on course to be quite profitable, but far more so than any other EV
- 2-3 weeks from a Tesla update/earnings report where apparently shorts best move will be to claim that the investment to build 12K cars in June that will deliver revenues in July was somehow “burned cash” by a company supposedly teetering on bankruptcy as Tesla will likely reiterate confidence re cash flow positive & earnings in Q3/Q4 timeframe... and no need for financing a cash infusion
- Analysts who on average have $2.69 in 2019 earnings, which I see as likely 1/2 to 1/3 what will occur, are getting more and more squeezed by reality to raise estimates on units sold, revenues, ASP, margins and earnings (see above)
-Elon has given some indication that he will do some long form interviews (ie Joe Rogan show among others) very shortly. A platform where he has done very well in the boosting signal over noise, and, having just been sobered by running full speed into a wall re the repercussions of his not filtering strongly reactive inflammatory comments.
If you’re feeling somewhat emotionally spent, no need to let it cloud that so many very promising Tesla/TSLA circumstances are in the midst of becoming far more visible.
I strongly suspect we are in one of the very best transient windows of time where there’s a gaping discrepancy between sentiment re Tesla and clear strongly bullish new information being appreciated to scale.
I see us as very very likely at the start of major shift in perception/appreciation of Tesla from heavy influence of bear false narratives to a considerably more realistic awareness of the company and its products. I think for much of the public, Tesla will go from looking like a team playing defense, and breaking down doing so, to a team looking like its moving down open field rapidly on offense.
I see this unfolding over anywhere from the next 2 months to the next 9.5 months.
In addition to the points in the post I replied to...
- we've just begun a 2 month period where the amount of Model 3s on the road will increase by about 150%, & a 9+ months period, where they will first arrive in Europe, and become about 8X as visible as what they are currently in NA. Put another way, at the end of that 9+ months, there will be ~1.5X as many Model 3s in NA as there are S&X combined today. Visibility shooting up.
- there are likely to be several high profile reviews of the P Model 3 released over the weekend viscerally reminding people of why so many became Tesla enthusiasts in the first place.
- up until this week, I thought the short position and the size of the media campaign associated with it would not break until several years into the 2020s. I now think there is a considerable chance we are at the maximum intensity of the campaign and it will begin to splinter some (though I still think considerable amounts will remain for years). I think there are three major groups in the short position and I think two of them may well drop their intensity significantly near term. fwiw, in the 7 minute clip of Chanos on CNBC a few days ago, I found him less strident than in the past.
-What's more, I suspect that there will be at least some retail shorts who got caught in the misinformation firehose, who will not only close out their positions, but will go from irrational venting at Elon/Tesla (supportive of the misinfo campaign), to some sore feelings re those pumping out the misinformation (perhaps some pointing out the misinfo campaign game).
- All those Model 3s hitting the road will not only lead to more sales, it will lead to a far wider group of people becoming skeptical about what they've heard from the misinformation campaign about Tesla and TSLA for years
I don't see a short squeeze coming.
I don't recommend the use of options.
I do, however, see us on the cusp of a shift in perception of "long vs. short," Tesla, and TSLA, of a size I think it is very difficult to well appreciate today given how long there's been a heavily fabricated tone of skepticism, gloom, and vulnerability about the company and its future. We can see today Tesla is kicking butt in a very very big way, even if it might take 2-9 months for it to feel that way. Perhaps all these events we are in the midst of and perhaps this
major perception shift I'm referring to is what Elon meant with his tweets about
SBOTC, etc. (though, that was not the most helpful choice of terms).