Short-Term TSLA Price Movements - 2014

[twinklejet]

@Twid This is the perfect time to be having this discussion. Would you rather NOT talk about it, and then watch the share price tank without knowing why it's tanking while losing money? Or would you rather have the chance to get out and sell your stock before it falls, so you can maybe buy back later at say $185? Blindly ignoring the bad and investing on hope and wishes is not the way to go IMO. If it is going to drop tomorrow I would be glad there was already a discussion on it. And no, there are not enough of us here to form a self-fulfilling prophecy. Even if this whole forum clicked sell at market open, I doubt we would cause a dent in the price without instituitional investors and hedge funds and professional day traders doing what they want to do with it.

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Any idea how far the stock will fall in the event they miss their delivery targets for whatever reason? A large crash or just a one day blip?

 

[Papafox]

Realize that the 3rd quarter includes July, August, and September. Realize that Elon will be in Japan in early September to hand over keys to the first buyers and that an event could take place in Australia in late September, too. Realize that Tesla has a track record of prioritizing production and deliveries by locations during a quarter in order to reach quotas. Realize that the Australian buyer in the thread in question had his car completed on Aug 20 and that delivery should take place before the end of the quarter. Realize that a one week behind schedule situation (which will be made up before quarter's end) will give Tesla further incentive to prioritize production and delivery sequencing.

I have become more bearish since writing the covered calls & will buy some puts & won't raise anymore caution flags & wait to hear if deliveries are missed the excuse "but our parking lot was full" to wall street analysts...good luck.

If TSLA stock drops because of this issue I will be buying calls.

 

[DaveT]

Q4 is going to be a monster quarter and institutional investors, funds, analysts all know that.

Let's review the numbers:
Q1 2014 - 6457 vehicles delivered
Q2 2014 - 7579 vehicles delivered
Q3 2014 - 7800 (guidance) vehicle deliveries

If Tesla meets the 7800 in Q3, then in order to meet their annual 35k unit guidance they would need to deliver a whopping 13,164 vehicles in Q4. We're talking about a major revenue jump from maybe $880M in Q3 to $1.4 billion in Q4. That would be close to a 60% quarter-over-quarter revenue jump.

So, let's examine the scenarios:
#1: Tesla meets (or slightly beats) 7800 vehicles delivered in Q3 and meets Q4 guidance of 13,000+ vehicles (to reach 35k units for the year).
#2: Tesla falls short of 7800 vehicles delivered in Q3 (ie., be a few hundred) but reaffirms guidance to meet Q4 guidance of 13,000+ vehicles (to reach 35k units for the year).
#3: Tesla falls short of 7800 vehicles delivered in Q3 and lowers 2014 guidance of 35k units to something lower.

IMO, scenario #3 is highly unlikely as they've already re-affirmed 2014 guidance at Q2 earnings and battery supply doesn't seem to be an issue. They will likely be able to get production up to speed (esp. in Q4) and meet 2014 guidance.

For scenario #1 and #2, Q3 deliveries doesn't matter that much as the big expectation is Q4 and Tesla delivering over 13k vehicles in Q4 and the mega-revenue growth that will show.

Now I'm not going to say TSLA won't drop at all in the short-term, because who really knows. But all I'm saying is as long as Q4 appears to be massive, I don't know if we'll see the "big sell-off" some of you guys are fearing/hoping/doubting/etc.

 

[Jack6591]

Quarter after quarter, Tesla slightly beats guidance. Quarter after quarter, we argue deliveries.

 

[uselesslogin]

If TSLA stock drops because of this issue I will be buying calls.

I'm with you on that. I guess you could call me bearish because I sold all the calls I bought when we were at $180. Actually I sold most of them at $230. If we get down to $200 again I will be using those earnings to buy again. I figure since there is no long-term threat here my best way of making money is buying *if* it dips. I can't bring myself to buy puts especially because this latest run is after a flat earnings report in which they only met guidance. I think people have their eyes on Q4 more than Q3. Otherwise I am probably core position only from here on out. I'm not sure I'll be doing much more short-term trading on TSLA.

 

[Twiddler]

@Twid This is the perfect time to be having this discussion. Would you rather NOT talk about it, and then watch the share price tank without knowing why it's tanking while losing money? Or would you rather have the chance to get out and sell your stock before it falls, so you can maybe buy back later at say $185? Blindly ignoring the bad and investing on hope and wishes is not the way to go IMO. If it is going to drop tomorrow I would be glad there was already a discussion on it. And no, there are not enough of us here to form a self-fulfilling prophecy. Even if this whole forum clicked sell at market open, I doubt we would cause a dent in the price without instituitional investors and hedge funds and professional day traders doing what they want to do with it.

- - - Updated - - -

Any idea how far the stock will fall in the event they miss their delivery targets for whatever reason? A large crash or just a one day blip?

To suggest blind ignorance, and other elements of your post, are going a bit too far, don't you think?

My point being, that the anecdotal reports of delivery delays are about as useful as reports of full parking lots. Interesting? Sure. Actionable? I would not think so, not at all. Delayed deliveries. Hmm, that's interesting - I think there is already a thread on that.

The time to lighten up a little was early last week, when the RSI was above 70 and MACD trended bearish. Not this.

I am just saying that once we get to these critical points, some names on this thread change, and I often get the feeling that certain individuals post and re-post the same issues, knowing that this board is trolled, and quoted rather frequently. What is more important to TSLA IMO is that a catalyst shows itself and soon. Otherwise, I think that any news that is anything but good will be used to drop us from this critical point. It is interesting that at this point there is an abrupt change in the discussion here. Just an observation.

 

[maoing]

I don't think TM will miss the delivery targets because they have enough "buffers" in the pipe to mitigate any production fluctuation. If you are talking about produciton, it could be possible due to assembly line upgrade and maybe this morning earthquak.

@Twid This is the perfect time to be having this discussion. Would you rather NOT talk about it, and then watch the share price tank without knowing why it's tanking while losing money? Or would you rather have the chance to get out and sell your stock before it falls, so you can maybe buy back later at say $185? Blindly ignoring the bad and investing on hope and wishes is not the way to go IMO. If it is going to drop tomorrow I would be glad there was already a discussion on it. And no, there are not enough of us here to form a self-fulfilling prophecy. Even if this whole forum clicked sell at market open, I doubt we would cause a dent in the price without instituitional investors and hedge funds and professional day traders doing what they want to do with it.

- - - Updated - - -

Any idea how far the stock will fall in the event they miss their delivery targets for whatever reason? A large crash or just a one day blip?

 

[justdoit]

I live about 15-20 miles from the Fremont facility. Felt the earthquake but it was fairly light. Would be very surprised if it did any significant damage to the facility.

 

[chickensevil]

This is not a good time to be having this discussion. Right now, we need a good catalyst to break out of the handle formation. Everyone piling on short is going to create a double top. Granted, as stated the patterns mean nothing, but I fear that the double top will be a self-fulfilling prophecy and money will fly out of TSLA and hurt the stock for a while to come, regardless of good news. If Elon has any spy photos of the model X that he could "leak", now would definitely be the time to do so.

Doubt it would crash that hard... I see it only falling back to around 240 if it did. There is a decent amount of support through there. In a worst case maybe 200.

 

[uselesslogin]

If anyone is interested Elon will be speaking at "one of the key industry exhibitions and conferences for the offshore oil and gas industry [which will] be held in Stavanger from 25th to 28th August 2014:"

Tesla CEO Elon Musk to speak at ONS

 

[Robert.Boston]

Heh, I'm trying to imagine his comments. "We don't need your stinking offshore oil." ?!?

 

[chickensevil]

To suggest blind ignorance, and other elements of your post, are going a bit too far, don't you think?

My point being, that the anecdotal reports of delivery delays are about as useful as reports of full parking lots. Interesting? Sure. Actionable? I would not think so, not at all. Delayed deliveries. Hmm, that's interesting - I think there is already a thread on that.

The time to lighten up a little was early last week, when the RSI was above 70 and MACD trended bearish. Not this.

I am just saying that once we get to these critical points, some names on this thread change, and I often get the feeling that certain individuals post and re-post the same issues, knowing that this board is trolled, and quoted rather frequently. What is more important to TSLA IMO is that a catalyst shows itself and soon. Otherwise, I think that any news that is anything but good will be used to drop us from this critical point. It is interesting that at this point there is an abrupt change in the discussion here. Just an observation.

In fairness I have been cautious for a while although I still feel like we could see a breakout from any positive catalyst. But ever since the Q2 report I have said that Q3 could be shakey and really hard to tell and that Q4 would be a blowout. I don't think it is fair to say everyone being cautious is some bad thing... Just shows that more people are catching on to the state of Q3. It is just a difficult time to trade because of these uncertainties. The safe bet is to wait for Q4. If you have the stomach for risk you can play Q3 because the stock is just as likely to go up as it is down at this point (still hoping for up)

 

[Raffy.Roma]

Heh, I'm trying to imagine his comments. "We don't need your stinking offshore oil." ?!?

It would be nice if Elon gave directions to get rid of a good amount of oil to be replaced by renewable energies. IMO a target in this sense should be established at global level. Elon would be a pioneer in this respect.

 

[vgrinshpun]

Hold off buying puts, Lump! In fact you might need to roll these covered calls that you've sold...:wink:

We have a new 12-18 month PT of $385 from Global Equities Research. (previous PT $225 - updated 2/5/2014)

According to the streetinsider.com digest, the factory doing just fine with the new production line ramp-up: is about at 800 cars/week now, should hit 1000 by the end of this quarter. Oh, and BTW, it's potential production capacity is 3,000 cars a week!

There are quite a few pieces of other very interesting information in this digest:

http://www.streetinsider.com/Analys...p+Dive+Into+Tesla+(TSLA)+Factory/9778304.html

 

[Raffy.Roma]

There are quite a few pieces of other very interesting information in this digest:

http://www.streetinsider.com/Analys...p+Dive+Into+Tesla+(TSLA)+Factory/9778304.html

I read a very interesting thing in the linked article:

• On the factory floor, we observed an area set aside and labeled "Driver Assist"
• We at GER speculate, it is more than just parking sensors and probably it could very well be the much rumored feature of "Driver Assist" that could be using MobileEye technology

Cool!

 

[Lump]

Hold off buying puts, Lump! In fact you might need to roll these covered calls that you've sold...:wink:

We have a new 12-18 month PT of $385 from Global Equities Research. (previous PT $225 - updated 2/5/2014)

According to the streetinsider.com digest, the factory doing just fine with the new production line ramp-up: is about at 800 cars/week now, should hit 1000 by the end of this quarter. Oh, and BTW, it's potential production capacity is 3,000 cars a week!

There are quite a few pieces of other very interesting information in this digest:

http://www.streetinsider.com/Analys...p+Dive+Into+Tesla+(TSLA)+Factory/9778304.html

Thanks, will hold off after hearing news direct from inside the factory.

 

[vgrinshpun]

• I read a very interesting thing in the linked article:

• On the factory floor, we observed an area set aside and labeled "Driver Assist"
• We at GER speculate, it is more than just parking sensors and probably it could very well be the much rumored feature of "Driver Assist" that could be using MobileEye technology

Cool!

My personal favorite, after info on factory ramp-up is this:

• On the 2nd floor of the Tesla Factory, cells are assembled into Battery modules, which are then assembled into a Battery Pack
• A complete area has been set aside on the 2nd floor of the Tesla factory to assemble Stationary Batteries

 

[chickensevil]

Hold off buying puts, Lump! In fact you might need to roll these covered calls that you've sold...:wink:

We have a new 12-18 month PT of $385 from Global Equities Research. (previous PT $225 - updated 2/5/2014)

According to the streetinsider.com digest, the factory doing just fine with the new production line ramp-up: is about at 800 cars/week now, should hit 1000 by the end of this quarter. Oh, and BTW, it's potential production capacity is 3,000 cars a week!

There are quite a few pieces of other very interesting information in this digest:

http://www.streetinsider.com/Analys...p+Dive+Into+Tesla+(TSLA)+Factory/9778304.html

The information in this report may be exactly what we needed. This has nothing to do with the price increase but rather the little details they provided that no one else has been allowed to due to their NDAs I assume.

One thing we do have is that they are not quite back up to 800 based on the way the report was stated. This does reaffirm that there has been some things not quite working that has caused a minor delay. But if they can ramp pretty fast past 800 into the 1,000 mark we should see no issue meeting guidance. 825 average is the amount to meet so the sooner we get past 800 the easier this will be met.

I had some money I was hoping would clear before we saw a major movement shift but looks like it won't hit in time... Oh well, just my luck.

 

[vgrinshpun]

Hold off buying puts, Lump! In fact you might need to roll these covered calls that you've sold...:wink:

We have a new 12-18 month PT of $385 from Global Equities Research. (previous PT $225 - updated 2/5/2014)

According to the streetinsider.com digest, the factory doing just fine with the new production line ramp-up: is about at 800 cars/week now, should hit 1000 by the end of this quarter. Oh, and BTW, it's potential production capacity is 3,000 cars a week!

There are quite a few pieces of other very interesting information in this digest:

http://www.streetinsider.com/Analys...p+Dive+Into+Tesla+(TSLA)+Factory/9778304.html

I am not sure what other catalyst might have played a role, but after last Global Equities research note and PT of $225 in three days, Feb 6-8 TSLA went from 2/5 close of 174.42 to $196.56 close on 2/8.

The link for the previous note on Streetinsider.com is broken, but I found this on page 114 of this thread, compliments of GravityPull

Global Equities Research analyst Trip Chowdhry is convinced that Tesla Motors (NASDAQ: TSLA) will likely build a "Mega" battery factory soon.

The analyst sees the factory having 30 gigawatts of production capacity per year. This would make it the biggest in the industry, even bigger than the current total production of capacity Non-Metal-Air Battery (Lithium-Ion) in China, Korea and Japan, all taken together.

He sees the factory being built in New Mexico and sees the company partnering with both Panasonic and Sanyo on the build out.

In addition to its traditional battery, Tesla may also manufacture Hybrid Battery Pack, which includes both Metal-Air Battery as well as Non-Metal Air Battery. He sees the 2015 Model S getting a possible 10% to 15% increase in driving range – driven primarily by innovations in Battery Packs, including Hybrid Battery Pack.

The firm maintained an Overweight rating and price target of $225 on Tesla.

 

[32no]

Thanks, will hold off after hearing news direct from inside the factory.

This is the same firm that was talking about the Gigafactory scale and location 2 weeks prior to the official announcement (February 26 vs February 5):

http://www.streetinsider.com/Analys...+Factory+in+New+Mexico+-+Analyst/9129124.html