Short-Term TSLA Price Movements - 2013

[kevin99]

I'm not sure exactly what he's referring to, but I definitely had a (nationalistic?) reaction to some of what Elon said in Munich. More specifically, "we're investing a lot of time and effort in Germany" (which might suggest we're not doing so in the U.S. which still has lots of SC to get done, etc.).

Also, there's "Why do you have to 'spend all this time and effort'? Is the market not meeting your prior expectations and so you 'have to act'?"

I beg to differ. I think too much reading into what Elon said can always pick plenty of holes. He was in Munich, so no fault making the local feels a bit special. And indeed he seems genuine in what he said. No marketing gimmick, so no backfiring.

 

[mershaw2001]

I'm quite disappointed Tesla would wait until thursday to release the good PR. For one, I think the effect is dampened when it's been out a few days. However, I think the bigger impact is that we're flirting with the 50 day moving average and if we end the day below, I think we'll see a long bar down. As of now, we're ok above it, but if we got down to 168 or 169 I'd be a bit concerned going into tomorrow.

edit: it seems likely to me that we will see a swing one way or the other at the end of the day, either rejecting the 50 day moving average to end up several dollars, or if it looks like it will end below that point it will plunge down.

Yesterday we flirted with the 50 day moving average and today we broke through it, and as we expected, we get a large bar down because of that. I am in agreement with everyone here that 162 is the bottom, though it seems to have touched 160. I'm incredibly comfortable buying here. I see no large institutions dumping, and I believe they picked up shares in the 160 range before.
In the past 2 days we've had FUD about germany, a potential investigation into the fire, and a crappy BOA report, none of which will impact the company. In fact, the company has ordered more batteries than expected for next year which indicates that they are doing well.
We currently have a divergence between the true state of the company and the image that short sellers are putting up. No large institution will dump because of price movement of 10 dollars, which is why we have no volume.
I was not surprised to see that Elon moved up the press release about germany from thursday to today, as he often defends the stock. I was not surprised to see it failed to do anything, as I believe he blew it by separating the actual event from the release, which means that some people already knew about it and it had no surprise factor.

I expect Elon will come to the rescue with a harder statement tomorrow or that Andrea James from Doherty will come out with a statement in the next 24 hours.
The most likely bar that we will see next is a long bar up, I believe, especially if the general market returns to neutral from being down today.

 

[Convert2013]

I'm not sure exactly what he's referring to, but I definitely had a (nationalistic?) reaction to some of what Elon said in Munich. More specifically, "we're investing a lot of time and effort in Germany" (which might suggest we're not doing so in the U.S. which still has lots of SC to get done, etc.).

Also, there's "Why do you have to 'spend all this time and effort'? Is the market not meeting your prior expectations and so you 'have to act'?"

Yeah at times I really felt he was working too hard to impress the Germans. But the Germans are very passionate about their cars and driving and may need that extra convincing to buy, ahhm, especially an American car. Germany is the 3rd largest car market and is definitely important. I think Elon being there personally is a great sign and it shows Germans that he cares. Guessing he will do the same for China soon.

 

[fjm9898]

Weeden joined in the Tesla Bashing today too - Four Reasons Why Its Time to Short Tesla: Analyst - MoneyBeat - WSJ

 

[Chickenlittle]

I'm not sure exactly what he's referring to, but I definitely had a (nationalistic?) reaction to some of what Elon said in Munich. More specifically, "we're investing a lot of time and effort in Germany" (which might suggest we're not doing so in the U.S. which still has lots of SC to get done, etc.).

Also, there's "Why do you have to 'spend all this time and effort'? Is the market not meeting your prior expectations and so you 'have to act'?"

obviously not enough time to say that. the car registrations have never been correct here and i wonder about a delay anyway. i took two months to register my car. there will be a bit of nationalistic attitude to get germans to buy an american car and we (the royal we) need not to step on toes. this slide has spooked a lot of people and a stellar report may even be an opportunity to get out for some. a lot of promises equals a lot of expenses but these should not reflect in the 3rd qtr report. i find musk to be very honest and the secrecy about production rate is wierd. his comment about enough batteries to produce 1200 cars a week was the perfect opportunity to say that we are only at half that or whatever the rate. the silence is interpreted by some as concern over the qtr

 

[kevin99]

If it makes you feel better, we just fell back to 162.50. :tongue:

I don't expect it go straight back up. This is a muddy fight. But for the first time in several days, I do feel optimistic on $160 is the line to hold and the pressure is on the rebound, rather than sell off.

 

[FluxCap]

Can you elaborate on this? What exactly did he say that was bad for TSLA? I haven't listened to the entire video yet...

My thought is that a CEO in the position he is in should basically never "declare a favorite" target market at all. What he did by saying that was:

1) "Offend" all the other markets that Tesla operates in and make analysts question how much supply of product will be allocated to each of those markets.
2) Paint a giant, red bullseye on Elon's back because he has now personally offended the egos of the real Tesla competitors (not downmarket EV's with 40 mile range) -- who makes the best luxury sedans in the world? BMW, Mercedes, Audi/VW. We all know this is the competition for the Model S and Model X. Where before these companies were uncomfortable but probably respected Elon as an engineer and futurist, now they are forced to target him and hit back. And hit back they can from a marketing standpoint. I still don't think they will be able to build a car that competes with the Model S legitimately for another 4-5 years, but if and when they realize this they will hit even harder. And I think it was too early to "declare victory" over Germany yet, which it seemed like he did with this comment.
3) The rest of the market-moving reveals he made there were done in a sloppy speech. Those kind of reveals to date from Tesla have been slow, methodical and careful, using holistic marketing campaigns that combine news outreach, social media, and carefully-crafted blog posts and press releases. Imagine if Elon's response to the fire had been over beers in some bar, picked up on a smartphone like this Germany show was. The market would have punished him hard.

I also didn't like allowing AT&T to claim they had a "partnership" with Tesla when they are really just a supplier like any other. It's mixing brand identities.

Basically, what I am seeing are "rookie mistakes" of a CEO transitioning from a startup, to a maturing company. I am still confident Elon can handle the transition, but I see evidence of goofs here and there, goofs that I think he needs to surround himself with smart people in order to prevent in the future. No CEO can be good at everything, and the best ones realize this and hire other smart people to make up for their shortcomings.

I'm still long Elon, but I think the man needs some marketing/PR/Investor Relations reinforcements.

P.S. Elon, if you want to hire me to consult, let me know .

 

[sp4rk]

I beg to differ. I think too much reading into what Elon said can always pick plenty of holes. He was in Munich, so no fault making the local feels a bit special. And indeed he seems genuine in what he said. No marketing gimmick, so no backfiring.

Agree with Kevin. Wording can be tricky. I hear the United Airlines commercial and hear them say "rededicated to serve you" or some such ... which makes me question ... when did you stop?
Elon has a way with words. Slight echolalia? He even cussed into the mike in Germany using the word "bull$hit". Forget the context. Hydrogen cells? What other CEO is that candid? He is a human like the rest of us and while I hope he is coached somewhat, he's "genuine".
I did mentally compare that video to the one shot in Norway when he and George took the stage. For those of us fortunate enough to have met both, I find them both excellent for the formidable role they have accepted. We just need to support them with our roles.

 

[ckessel]

My thought is that a CEO in the position he is in should basically never "declare a favorite" target market at all.

First, he didn't declare a favorite, he acknowledge the importance of the market with some remarks about what makes it unique. As he has done with China. If he has a favorite market, it's probably Norway.

Second, I'm getting the impression you haven't followed Elon for very long. His Munich presentation is almost exactly the way he's been doing his presentations/speeches for years.

 

[FluxCap]

First, he didn't declare a favorite, he acknowledge the importance of the market with some remarks about what makes it unique. As he has done with China. If he has a favorite market, it's probably Norway.

Second, I'm getting the impression you haven't followed Elon for very long. His Munich presentation is almost exactly the way he's been doing his presentations/speeches for years.

He said, verbatim:

"In fact, right now, Germany is our top focus in the world."

 

[brianman]

My thought is that a CEO in the position he is in should basically never "declare a favorite" target market at all.

Agreed. I'm not saying he did declare a favorite, but your general premise is right. "All of my children are special in their own way" is sappy but safest.

 

[Convert2013]

So does anyone think Elon will announce a new factory during ER?

 

[fjm9898]

So does anyone think Elon will announce a new factory during ER?

Why? they are barely even scratching the surface of the one they have... china would be the only maybe but he has spoke about shipping being cheap that way.

 

[brianman]

@kevin99 and others
I'm not concerned about what he said or how he said it. I like when he can talk (mostly) without filtering. I learn more, it's genuine, etc. My point was that I see what Flux and perhaps others can find concerning in both his content and approach.

 

[hoang51]

So does anyone think Elon will announce a new factory during ER?

Most likely not. The main one in California is hardly at full capacity. Even the rumored battery factory in California isn't happening because Samsung and LG were deemed to be second hand battery suppliers. I would think a new factory sometime during the Gen III production time frame would require one if the mainstream accepts the car.

 

[fjm9898]

Most likely not. The main one in California is hardly at full capacity. Even the rumored battery factory in California isn't happening because Samsung and LG were deemed to be second hand battery suppliers. I would think a new factory sometime during the Gen III production time frame would require one if the mainstream accepts the car.

Why still? NUMMI is good for 400-500k production. Maybe if Gen 3 really takes off then by 2020 they might require a new factory.
They would need to keep expanding their current facility, not build an entire new one.
They need to squeeze out as much GM as they can from their current line. they are only running 2 shifts out of a possible 3.
Lets wait till Gen 3 hits the ground before we even start talking about need for an entire second factory.

 

[InTheShadows]

My thought is that a CEO in the position he is in should basically never "declare a favorite" target market at all. What he did by saying that was:

1) "Offend" all the other markets that Tesla operates in and make analysts question how much supply of product will be allocated to each of those markets.
2) Paint a giant, red bullseye on Elon's back because he has now personally offended the egos of the real Tesla competitors (not downmarket EV's with 40 mile range) -- who makes the best luxury sedans in the world? BMW, Mercedes, Audi/VW. We all know this is the competition for the Model S and Model X. Where before these companies were uncomfortable but probably respected Elon as an engineer and futurist, now they are forced to target him and hit back. And hit back they can from a marketing standpoint. I still don't think they will be able to build a car that competes with the Model S legitimately for another 4-5 years, but if and when they realize this they will hit even harder. And I think it was too early to "declare victory" over Germany yet, which it seemed like he did with this comment.
3) The rest of the market-moving reveals he made there were done in a sloppy speech. Those kind of reveals to date from Tesla have been slow, methodical and careful, using holistic marketing campaigns that combine news outreach, social media, and carefully-crafted blog posts and press releases. Imagine if Elon's response to the fire had been over beers in some bar, picked up on a smartphone like this Germany show was. The market would have punished him hard.

I also didn't like allowing AT&T to claim they had a "partnership" with Tesla when they are really just a supplier like any other. It's mixing brand identities.

Basically, what I am seeing are "rookie mistakes" of a CEO transitioning from a startup, to a maturing company. I am still confident Elon can handle the transition, but I see evidence of goofs here and there, goofs that I think he needs to surround himself with smart people in order to prevent in the future. No CEO can be good at everything, and the best ones realize this and hire other smart people to make up for their shortcomings.

I'm still long Elon, but I think the man needs some marketing/PR/Investor Relations reinforcements.

P.S. Elon, if you want to hire me to consult, let me know .

I think Elon did this on purpose. He has stated many times that his main purpose is not to make a profit but to revolutionize the auto industry. He went to the heart of the greatest automakers on the planet and threw down a challenge. I am reading that he is mad he doesn't have competition. (I think he was really disappointed in the i3) His vision is too big for one auto manufacture to undertake. To get to his real goal he needs other companies to step up to the plate and make a real EV.

 

[Convert2013]

Why? they are barely even scratching the surface of the one they have... china would be the only maybe but he has spoke about shipping being cheap that way.

Yeah probably too early for S & X needs, but they need to have one or two more plants ready to spit out Gen 3s by 2016/2017. Re-tooling and hiring for a factory or two for EVs will possibly take 1 to 2 years. Maybe he'll announce firmer plans on how many and where..

 

[justdoit]

This is the analyst "downgrade" that everyone has been talking about on here for the past several weeks. So if you're lucky enough to be able to buy, and are buying... I'm jealous of you! The overall market is down, we get downgrades, no real good news and still only down 5% today?! Come on, is that the best the shorts can do!

I've read on twitter and other places tons of people saying they wish it came down to the 160's so they can buy more, well this is their chance. But I bet most aren't buying b/c they're scared. What's that saying everyone loves to quote but not many actually practice. "Buy when others are fearful and sell when they're greedy". It's a lot easier to say than actually do.

For those that don't have a lot of buying power, I know it's easy to panic but just remember this is the downgrade we were expecting/waiting for. Just because we don't have the money to buy doesn't mean we shouldn't just hold on.

I wouldn't be surprised if we slowly trend back up to the mid to high 160's. If we do that, then we have some good days ahead. This is my personal opinion and strategy. If you're in a different financial situation then you know what you need to do. But I'd say hedging (buying some puts maybe) is probably a better way to go to get some peace of mind and just expect and hope you lose that money Those of us who bought calls, I hope we understood the risk and only used money we were ok with losing (even though it'd suck).

 

[FluxCap]

Agreed. I'm not saying he did declare a favorite, but your general premise is right. "All of my children are special in their own way" is sappy but safest.

That's precisely it.

I'm also not saying that this marketing goof moved the stock in some major way -- it's just evidence that I would consider as an analyst covering the stock of Tesla's future marketing strategies, and how I might price that in. You guys asked me to explain my reasoning, so I did.

The movement over last few days has much, much more to do with the all-out assault by the analysts, news outlets and oil/auto industry interests who are still stinging from being wrong for most of the last year, ganging up together to essentially try to shove the stock down in a unified attack.

What I'm hoping now is that shorts pile in and then when there is a sharp upturn from some positive news item, they get scared and we get another mini-short-squeeze scenario. Not banking on this but one can hope.

For what it's worth, my wife thinks that we are near the bottom for absolutely no reason other than her "gut feeling." Maybe she is some secret market sage, who knows.

She also asked me: "Do you still believe in this company's potential to go over $50billion market cap in the next 3-5 years like you said?"

Me: "Yes, honey."

Her: "Well then shut up and hang on for the ride. It's a long one."