Short-Term TSLA Price Movements - 2013

[jeffro01]

Northland Capital sets $95 target...

Full article: http://blogs.marketwatch.com/thetel...-target-as-shorts-are-jolted-by-first-profit/

Jeff

​

 

[gg_got_a_tesla]

Wanted to toss in a footnote after this fabulous week: the folks that I'm most happy for right now are the brilliant Tesla employees who've endured years of negativity and naysaying to arrive at this day!

I'll not begrudge them slowing or stopping the squeeze by selling as many vested stock options as they can. You guys have made this fantastic car and investment returns happen for all of us! Thanks!

 

[smorgasbord]

I'm guessing this is going to be a slow-ish squeeze. That's going to give new shorters the opportunity to short Tesla at $80, maybe $90 next week. And who could blame them? Are you buying Tesla at $90 a share? Then why would anyone else?

 

[CyberDutchie]

I'm guessing this is going to be a slow-ish squeeze. That's going to give new shorters the opportunity to short Tesla at $80, maybe $90 next week. And who could blame them? Are you buying Tesla at $90 a share? Then why would anyone else?

I would buy at $90 once it has hit $100. I believe this company will set new highs for the foreseeable future, I just don't see what could possibly go wrong.

 

[FredTMC]

Wanted to toss in a footnote after this fabulous week: the folks that I'm most happy for right now are the brilliant Tesla employees who've endured years of negativity and naysaying to arrive at this day!

I'll not begrudge them slowing or stopping the squeeze by selling as many vested stock options as they can. You guys have made this fantastic car and investment returns happen for all of us! Thanks!

+1!!! TM employees and mgmt are rock stars.

 

[FVO]

I would buy at $90 once it has hit $100. I believe this company will set new highs for the foreseeable future, I just don't see what could possibly go wrong.

Watch out for a bubble that can explode (off course i'm not hoping that). But Tesla so far made only 10.000ish cars and some powertrains for Toyota and Smart, and has already the value of Fiat or Mazda...

Don't understand me wrong, i hope they blast al the other carmakers away within 10 years. But i'm a bit cautious.

 

[Cobos]

Watch out for a bubble that can explode (off course i'm not hoping that). But Tesla so far made only 10.000ish cars and some powertrains for Toyota and Smart, and has already the value of Fiat or Mazda...

Don't understand me wrong, i hope they blast al the other carmakers away within 10 years. But i'm a bit cautious.

I've been wondering about this. The Fiat I see listed at a valuation lower than Tesla is that a US division of Fiat Europe (the big Italian carmaker with brands like Fiat, Alfa Romeo, Ferrari and Maserati ?) or the big Fiat group? Didn't they buy Chrysler recently, so Tesla is now bigger than Fiat AND Chrysler combined? Someone please explain this to me.

Cobos

 

[anticitizen13.7]

I'm guessing this is going to be a slow-ish squeeze. That's going to give new shorters the opportunity to short Tesla at $80, maybe $90 next week. And who could blame them? Are you buying Tesla at $90 a share? Then why would anyone else?

The flip side of that is "are you selling Tesla at $90/share?" Individual and institutional investors who already own Tesla stock may not want to weight their portfolios with more shares. These same investors might not sell at $90 because they believe the company will become much more valuable in the future.

 

[Bgarret]

Quick questions - who is buying and who is selling? Approximately 53 million shares traded in 2 days: according to Yahoo Finance 32-38% owned by 5% and insiders (range provided for approximately 20% short interest distortion based on Markit) and 56-70% by mutual fund/institutional owners. Based on this and other estimates of the freely trading shares we've turned all tradable shares (except the shares held by those on this thread) at least once. I think this is unlikely. I would like the wise feedback from the folks who have helped me bank 1/2 my Model S in 3 days for the likelihood of the 2 scenarios below:

1. Short-on-short violence: The majority of trading (around 40 million of the shares) is shorts covering and re-shorting the higher price or selling to new shorts. If they hated the stock at 35, they detest it at 70 with less $ in their bank accounts. I read on stocktwits that there is another shortage of shares to borrow to short TSLA.

2. A reverse-Icahn/Netflix play: Icahn started the short squeeze in Netflix by buying 10% of Netflix that had a 13% short interest. At the time Netflix traded for about $60/share. After surprise earnings beat in Jan, the stock went from 100-160 in a day. What if Icahn-like investor or Brin/Page bought up 10% of TSLA for $700million after the earnings beat to accomplish the same thing.

The number of shares and scarcity of shares to short is interesting. Thanks for everyone's input/effort. It's fun to read your musings. Test drove A Model S performance Thursday. Wow. Accidentally killed a bird on a straightaway...it didn't hear me coming.

 

[smorgasbord]

I just don't see what could possibly go wrong.

As bullish as I am on Tesla, I see all kinds things that could possibly go wrong. This is not a sure thing.

 

[DonPedro]

I've been wondering about this. The Fiat I see listed at a valuation lower than Tesla is that a US division of Fiat Europe (the big Italian carmaker with brands like Fiat, Alfa Romeo, Ferrari and Maserati ?) or the big Fiat group? Didn't they buy Chrysler recently, so Tesla is now bigger than Fiat AND Chrysler combined? Someone please explain this to me.

Fiat is a business with relatively low margins and low growth, and the value is determined by the present value of future earnings (which can be reasonably forecast). Tesla is a business with ultra-high growth and potentially high margins, which many people believe has the potential to become the "Apple of the car industry".

With hindsight, if you go back to e.g. 2002, which company should you be buying at the higher valuation - Nokia or Apple? At that point in time, you would have been "crazy" to suggest Apple was more valuable than Nokia. However, if enough investors with their precognition working had been in the market, it would and should have been. The hard thing for investors right now is whether they believe this to be the case with Tesla. It seems they are increasingly convinced.

 

[gg_got_a_tesla]

As bullish as I am on Tesla, I see all kinds things that could possibly go wrong. This is not a sure thing.

True. It's a car after all; recalls, major or minor, are possible. Something like that may dent car buyer and investor confidence. So, it's always wise to tread carefully.

 

[DonPedro]

For a comprehensive review of things that can go wrong, I can recommend the "Risk Factors" section of yesterday's 10-Q SEC Filing. Reading that is also very educational in terms of what is going on inside Tesla nowadays.

 

[gaswalla]

For a comprehensive review of things that can go wrong, I can recommend the "Risk Factors" section of yesterday's 10-Q SEC Filing. Reading that is also very educational in terms of what is going on inside Tesla nowadays.

Great reading. Thank you for linking

 

[InTheShadows]

Recalls don't have to be a necessary part of the auto industry. The reason there are recalls is that car manufactures don't hold themselves to a high enough standard. Elon and team are redefining the industry and they are changing everything about it. They are holding themselves to a much higher standard than any other car maker has before. Remember when Elon was holding up the production line because the sun visor wasn't precise enough? This is a seemingly minor issue that most other manufactures likely would have simply overlooked and pushed the product out the door. Not Elon, because he insists on perfection. Not to mention he has taken an extremely complex product and simplified it dramatically. There are way less parts to fail on a Tesla.

Elon is holding the company to the same standard that he is holding SpaceX. He is treating each car like it is a $100 million rocket that could blow up if the smallest detail is overlooked. This level of excellence is one of the reasons that makes Tesla so great. I'm not saying a recall is out of the picture but I would be extremely surprised if they have one ever while Elon is at the helm.

 

[DonPedro]

Recalls don't have to be a necessary part of the auto industry. The reason there are recalls is that car manufactures don't hold themselves to a high enough standard.

Engineering errors will have a % probability of occurring in any engineering project. If you have good Quality Management you have a lower % probability, but it will still not go to zero.

 

[Nixx]

I call BS on this. Engineering errors will have a % probability of occurring in any engineering project. If you have good Quality Management you have a lower % probability, but it will still not go to zero.

agreed, and since they designed the model s from the ground up, your chances of making an engineering mistake is fairly high. I believe Tesla's saving grace is that the power train is drastically simpler than an ICE. With so many fewer parts to fail or malfunction, your scope is so much smaller.

 

[CapitalistOppressor]

agreed, and since they designed the model s from the ground up, your chances of making an engineering mistake is fairly high. I believe Tesla's saving grace is that the power train is drastically simpler than an ICE. With so many fewer parts to fail or malfunction, your scope is so much smaller.

Plus the power train is a second generation product. Don't forget they started development on the Roadster in ~2003-2004 and ultimately built ~2,400 of them and they have been on the road for 5 years now.

And for that matter the Roadster systems were based on prototype systems than had been being fiddled with at the kit car level from even before that. So there is both extreme simplicity and a decent amount of design heritage. Tesla has been engineering this product for a decade.

 

[Zaxxon]

Theshadows: Tesla has had two recalls already per the 10Q. They will happen periodically.

 

[Jonathan Hewitt]

This is another reason why Elon is not having them ramp up production to that "30K/year demand" level he mentioned at the conference call. By maintaining production at it's current level not only are they improving the gross margin, but also minimizing the chance of a big manufacturing defect by some rapid up-ramp in production.