Now you can see why I sold all my shares

[crazybarracuda]

Wow, very interesting article! Thanks for posting. I do not claim to understand more than a fraction of the Tesla financial analysis presented in that piece, but still was intrigued by it.

same here. I am and engineer and the deep financial bits of that article were way over my head but the parts i understood made the whole system for evaluating a company's cash flow based on a set of standards that dont match every company

 

[adiggs]

One suggestion I have when it seems appropriate - whatever you do for a living, a conceptual understanding of accounting is valuable to acquire. And I believe, easily something one can acquire in a few hours of effort.

Basic concepts like double entry bookkeeping, more difficult concepts like debits and credits, and the ability to read a balance sheet, net income statement, and cash flow - as well as having the understanding of what each represents, why they're different, and why they don't substitute for each other.

Ultimately, whether we like it or not, this is the language of business.

I don't know this particular website or introduction, but the table of contents and description looks just about right to get the basics and terminology with a few hours of reading:
Accounting Basics | Explanation | AccountingCoach


This level of understanding will help with the issues of recognizing revenue, and why treating the Tesla Resale Value Guarantee might have been the right thing to do under GAAP, it is a misleading way to view the business (I agree with this point made in Julian's article), and reduces clarity and understanding of the business - not increase it.

And ultimately, the point of accounting is (in my eyes anyway) is to create clarity and understanding of a business, and enable comparison of businesses that otherwise appear to be similar.

 

[SΞXY P100D]

I call BS. What a waste of time thinking I'd find useful stock info over here.

 

[GoTslaGo]

I'm just glad this moved this out of Model 3 forum, and into the appropriate venue.

 

[neroden]

Well you're probably not holding 33k shrs. I sold it all. Bought it at 27.xx 4 yrs ago after Elon was on the front page of Fortune magazine in front of the roadster.

I'm only in for less than a million dollars; you (claim to have) bought nearly a million dollars in shares to start with, and I can see why you'd want to do some profit taking on $7.26 million. If I were in your position, however, I would have cashed out some of it and kept a million dollar stake.

...although I see from our resident fact-checker that you may be telling porky-pies.

 

[CHG-ON]

My broker (UBS) just came to me saying that she is concerned. Their saying sell with a target of 160. I am torn. I completely believe in the mission. I am beginning to think I should take the current profit, sit back and get back in.

 

[MikeC]

My broker (UBS) just came to me saying that she is concerned. Their saying sell with a target of 160. I am torn. I completely believe in the mission. I am beginning to think I should take the current profit, sit back and get back in.

Only sell if you agree with their analyst's assessment: m.benzinga.com/article/8243524?utm_referrer=http%3A%2F%2Fwww.benzinga.com%2Ftopic%2Fcolin-langan

I would change brokers instead.

 

[jdw]

My broker (UBS) just came to me saying that she is concerned. Their saying sell with a target of 160. I am torn. I completely believe in the mission. I am beginning to think I should take the current profit, sit back and get back in.

Wonder what that broker advised regarding AAPL in 2002-2006 ... mine was quite adamant that they were strongly advising clients to stay away from the stock altogether and that I was a fool to even consider it - at the split adjusted price of $4.00. Fast forward to 2012 at almost $100 per split adjusted share and they were now recommending that I buy big - just prior to a 30% dip.

With AAPL, doing the opposite of their advice worked out very nicely. YMMV with TSLA, but I struggle taking investment advice from most brokers.

You need to do your own research and listen to your instincts.

 

[CHG-ON]

Agreed. Thanks. It's making me think.

 

[Topher]

I completely believe in the mission.

Stock price is not dependent on the righteousness of the company's mission. Feel free to love Tesla' mission while selling their stock at every high and buying at every low.

Thank you kindly.

 

[BornToFly]

You need to watch the video on the TSLA web site from the Gigafactory opening Friday night. Tesla Gigafactory Grand Opening

The human mind is really poor at comprehending large numbers. Whether it is the size of our national debt, or the size of this factory and the battery output it will achieve 4 years from now. I think that is why so many people, some analysts included, continue to under estimate Tesla. There is simply no competition in either the automotive, or storage industry, that will be able to touch Tesla. 150 GigaWatts just doesn't mean anything to most people. I kind of feel sorry for the shorts. We are talking about a highly automated factory that is so big, it will still need 10,000 employees. No other company will be able to come close to producing 1.5 million cars a year around 2020-2022 like Tesla, because the batteries to do it will not exist anywhere else (and the cost will be too high for them trying to buy them from a third party and produce a car at a competitive price). Add to that the battery storage business which will be even more profitable, and annual profits of $30 Billion/year in 10 years is a low estimate. It is pretty obvious to anyone that can start to grasp the magnitude of Elon's plan, that Tesla will be worth a minimum of $300 Billion in 10 years. That is why large organizations, like Fidelity, have been buying millions of Tesla shares over the last several years. I read a lot of articles, and listen to the analysts. Every person who talks or writes about Tesla not succeeding has major flaws in their arguments. They either haven't really done their homework, don't have the intelligence to grasp the magnitude, or are being paid by the oil/gas industry (which is extremely scared now because they know global demand will forever decline at this point). The stock price may trade in this 230 range for another 6-12 months, and then the sky is the limit as the future finally becomes obvious to everyone. You should be buying, not selling. The fact that Tesla has been in the 230 range for a couple years has been a huge gift. It has allowed me to slowly buy more and more shares at a good price. I plan to retire early by 2025. You might be able to save a few dollars buying after ER on Thursday.

 

[CuriousG]

150 GigaWatts just doesn't mean anything to most people.

"150 Gigawatts, Great Scott!" - Doc Brown

 

[jdw]

Stock price is not dependent on the righteousness of the company's mission. Feel free to love Tesla' mission while selling their stock at every high and buying at every low.

Agree, particularly if you are good at picking the lows and highs. TSLA is a volatile stock and the tick-tock can be very profitable.

If you're not good at that, another strategy that can work for a long is a gradual accumulation, buying on dips until you have bought what you are comfortable holding.

If you are a long, what you can't do with TSLA (or any other high potential growth stock) is follow the short term mainstream news cycle or traditional analysis of the business as most analysts tend to measure a new business by the same categories, standards and time frames as established businesses.

I find there is opportunity when you have knowledge, understanding or even a belief that isn't yet mainstream. There is also risk and volatility, which is why the payoff can be big. Turns out AAPL was not Packard Bell, yet both companies were reduced to simply "computer manufacturer" by analysts and measured primarily by quarterly units shipped and profit. In hindsight, it is obvious to most how different the companies were, but in 2002 it was not yet obvious to many.

Over and over, we have seen that a company with an innovative product & business model, a visionary founder and the ability to disrupt markets and other industries can challenge and beat established companies in the long term. In the short term, they will take a beating in the press and from many analysts.

 

[Topher]

150 GigaWatts just doesn't mean anything to most people.

Elon misspoke when he said that. It is 150 GigaWatt-hours (of batteries) per year. So technically only 17 MegaWatts, if it makes sense to talk about a factory in terms of power.

Not sure that helps at all for making it more comprehensible.

Thank you kindly

 

[anticitizen13.7]

My broker (UBS) just came to me saying that she is concerned. Their saying sell with a target of 160. I am torn. I completely believe in the mission. I am beginning to think I should take the current profit, sit back and get back in.

It comes down to 2 things: Risk Tolerance and Time Horizon.

Time Horizon: Obviously, if you need cash now or soon, selling and taking a profit is completely understandable. If you don't need the money for 10 years and believe Tesla has great potential, there's no reason to sell.

Risk Tolerance: Some people become agitated by the sometimes daily wild swings in TLSA price. The gain in peace of mind by exiting TSLA positions may be worth more than the $$$ potentially to be made. On the other hand, if volatility doesn't bother one much, holding on to shares may be the better option.

 

[BornToFly]

My broker (UBS) just came to me saying that she is concerned. Their saying sell with a target of 160. I am torn. I completely believe in the mission. I am beginning to think I should take the current profit, sit back and get back in.

I'm sorry, but if your broker is saying sell with a 160 target, they are an idiot. You need a new broker. If MAY go as low as 215 after ER this week. But Q3 and Q4 should be strong, and TE is supposed to positively affect earnings in Q4. 2017 should be a very good year with TE and then Model 3. The chance of seeing 160 again is close to zero without a major world wide market event like we had in February.

 

[CHG-ON]

Personally, I think most of these broker opinions are crap. I actually make the vast majority of my own buy/sell decisions. I pretty much only use UBS as my warehouse and facilitator. Not that I am an investment genius by any stretch.

I think a strong stomach is needed for Tesla investing. It's one of the most volatile stocks I have had. I think what the market is missing is the forward looking vision at what we need to be doing to ensure the longevity of the planet, etc. Tesla is in the forefront of this vision. Just looking at current and short-term company fundamentals does not tell the whole story at all. I simply do not understand how Wall Street cannot see the potential. Well, actually I can. They are just too stuck in quarterly performance and quick gains. I think the big rewards are looking way down the road.

I think where I am struggling is whether to cash out now to take advantage of the gain and then buy back in at another time. I have thought about puts and calls, as a friend of mine does. But I am not all that up on all the investment tactics anymore and I get nervous treading in an area where aI have little knowledge. My broker, understandably, takes the conservative approach. So it is up to me to figure out the aggressive plan.

My core belief is that Tesla will be the IBM or Microsoft of this century. MSFT had plenty of naysayers in the beginning. Look at the billions made by those who believed. So I will ponder this until the answer comes to me. I got in at 23 and bought the stock way before I ever considered buying the car because I believe in Tesla and the vision. So I certainly cannot complain.

Thanks all for the comments. Very much appreciated!

 

[dennis]

I think where I am struggling is whether to cash out now to take advantage of the gain and then buy back in at another time.

I bought at $27 and cashed in at $90 the week it went there from $55, thinking the same thing. Then I watched it run up to over $200 and stay there. I finally got a chance to get back in a few months ago at $175 after it bounced off the $145 bottom. Now I own half as many shares and missed out on a lot of potential profit. No more selling for me!

 

[electricity]

I find it funny how people pretend to know whats going to happen to Tesla stock. Honestly nobody knows, I held it while behind the scenes Elon and Co. shut down the factory , and where alsmost going to sell to Google. I had no idea, and nobody did. I didn't sell, fortunately things ended up well for the time being. What tommorow brings to the stock we don't know, brokers don't know, and nobody knows. My only advice to anyone reading this is hold the amount of shares you would feel will not change your life if things go south. Thats it, there is nothing else you can do really.

 

[neroden]

My broker (UBS) just came to me saying that she is concerned. Their saying sell with a target of 160. I am torn. I completely believe in the mission. I am beginning to think I should take the current profit, sit back and get back in.

Brokerages have an inherent conflict of interest when giving advice. They make more money when you make more trades, and they can even be on the other side of the trade from you so that they make more money when you lose money. NEVER take stock advice from a broker.

An independent advisor or independent analyst can be totally wrong too, but at least they don't have conflicts of interest.