Short-Term TSLA Price Movements - 2015

[ibcs]

Pre market buy order entered!

Thanks for the obvious idea.

 

[Jonathan Hewitt]

120K Volume now so far. Starting to get somewhat significant IMO. Off the lows but still down a lot. Looks like most of the trades are 100 shares or less.

 

[eloder]

There is still no reason in tesla being down 5 pct. I'm half considering staying up til open and buying weeklies if it stays this low counting on recovery through the day as people realize whatever is going on right now is bs

Lot of FUD articles about the earnings release. Tons of clickbait articles about Tesla hemorrhaging money despite the fact that it was well-noted and expected and has been part of the plan for Tesla.

I don't think the big up-moves will come until the analysts make their rounds and release mostly truthful information and speculation from the ER.

 

[FredTMC]

with 80.000 shares traded preparket only...to me this looks like an engineered drop from someone who wants to accumulate TSLA. Will be interesting to see how the market opens.

Yep. Very fishy. No way this lasts. First analyst to say something positive and stock rebounds.

 

[Larken]

European indices are rebounding strongly now and so is TSLA, from pre-market low of 216 to 224. Maybe the general negative market sentiment coupled with short attacks (apparently there's no TSLA shares to borrow at IB for shorting) pushed it so low. I'm hurting this morning with my June calls but the words that are running through my mind now is: Greedy when others are fearful.

 

[vgrinshpun]

Todays morning note from Baird says buy TSLA on solid earnings, but is mum on the stationary storage. Another one is coming after they have chance to crunch the numbers?

via StreetInsider.com:

Baird analyst Ben Kallo reiterated an Outperform rating and $275 price target on Tesla Motors (NASDAQ: TSLA) following better-than-expected results, reaffirmed delivery guidance, clarity on Model X, information on timing of Model 3, and storage commentary.

Kallo commented, "Bears may focus on light Q2 guidance but this is TSLA controlling the tempo of deliveries. Additionally, we believe sentiment has shifted as investors are willing to look ahead to the storage market potential. We remain buyers at current levels and recommend holding the stock into the Model X launch."

Commenting further on the Model X, Kallo, said, "We should get more details in July and initial deliveries should start in September. We believe the launch of the vehicle will be a significant catalyst and help solidify TSLA’s brand in the automotive industry."

The firm bumped FY 2015 EPS from $0.52 to $0.55 and set FY 2016 at $4.69.

For an analyst ratings summary and ratings history on Tesla Motors click here. For more ratings news on Tesla Motors click here.
Shares of Tesla Motors closed at $230.43 yesterday.

 

[Gtoffo]

European indices are rebounding strongly now and so is TSLA, from pre-market low of 216 to 224. Maybe the general negative market sentiment coupled with short attacks (apparently there's no TSLA shares to borrow at IB for shorting) pushed it so low. I'm hurting this morning with my June calls but the words that are running through my mind now is: Greedy when others are fearful.

Almost no more shares to short at Interactive Brokers.

Symbol: TSLA
Availability: 50'000

 

[jhm]

Thanks, Flux. It is good to have somebody to provide outside world feed to the Tesla gearheads here...

- - - Updated - - -



I think at least one of us is missing each other point. :smile:

I am not questioning rationale behind the possible decision to keep the margin low, just pointing out that math does not work.

Consider current pricing for the powerpack at $250/kWh. Elon said that there will be small margin while packs are manufactured at the Fremont factory. Let's say, for talking purposes, that Tesla's cost is $240/kWh. Now consider that large scale production at the GF will reduce cost by 30%, as guided by the company. So Tesla's cost to produce the powerpacks will be 0.7 x 240 = $168/kWh. So the gross margin at the GF would be 1-168/250 = 32.8%.

As you can see the math does not work - the three data points - small margin at Fremont at $250/kWh, 30% reduction due to manuf./scale efficiencies at the GF and 20% gross margin at the GF - contradict.

I see the may trouble. I think Musk is stating an aspiration. I think the guiding principle is to realize a 10% net profit margin. Auto is a more complex product to bring to market than stationary. Thus, SG&A allocated to stationary may be around 10% of stationary revenue while for auto it may be 20% of auto revenue. If so, then it would make sense to target 20% GM for stationary and 30% for auto. So I believe this is the sort of aspiration Musk has in mind.

At this point, I do not think it has anything to do with stationary being a commodity product. It is a decade or more from truly being a commodity. And in commodity pricing you only lower your price to meet the competion. There is no competitor out there challenging Tesla's price. Longer-term it makes sense for Tesla to stick to something like a 20% GM and drive the price down as they drive the cost down. This follows from the experience curve strategy. You want to keep would be competitors from entering your market and gaining the experience they would need to achieve your cost advantage. Intel is a great example of this. They have dominated the chip market for 40 years. Nobody has been able to get ahead of them on the experience curve. They lead perpetually on both technology and price.

So will Tesla take the price down in 2016 when GF1 starts packing, I don't think so. Initially , I think it will just be packing cell and there is only so much cost reduction to be had in that. Also I do not think the full efficiencies of GF1 will be in place as early as 2016. They'll have new employees, new processes and new equipment to work with. That's a lot of kinks to work out and lots of chaos. They will still be at the high cost end of the experience curve. But the good news is they'll be learning quickly. So perhaps in 2017 or 2018, they will have achieved enough efficiency that they can start to draw down the price. Getting this experience in before the Model 3 is released will surely advantage the GM on early Model 3 production.

 

[FluxCap]

Searching the dark corners of the internet for clues to this shady premarket action, and some of these wackos literally are borrowing on margin to short TSLA because they hate Elon Musk, period, and are convinced that the planned cash outlays for gigafactory construction mean Tesla will go bankrupt ASAP. That seems like a great bear thesis...

I might buy this morning as well.

 

[ev-enthusiast]

German DAX turning positive right now:
http://www.boerse-frankfurt.de/arcmsdata/daxcam/parkettcam_big.jpg

 

[Jonathan Hewitt]

Searching the dark corners of the internet for clues to this shady premarket action, and some of these wackos literally are borrowing on margin to short TSLA because they hate Elon Musk, period, and are convinced that the planned cash outlays for gigafactory construction mean Tesla will go bankrupt ASAP. That seems like a great bear thesis...

I might buy this morning as well.

I know I am. I'm thinking of writing some puts to collect some time premium while the churning goes on.

 

[doggusfluffy]

Searching the dark corners of the internet for clues to this shady premarket action, and some of these wackos literally are borrowing on margin to short TSLA because they hate Elon Musk, period, and are convinced that the planned cash outlays for gigafactory construction mean Tesla will go bankrupt ASAP. That seems like a great bear thesis...

I might buy this morning as well.

Well, if all the research you did was read major news headlines or skim the articles you might be left with the impression that Tesla missed earnings and abandoned stationary storage entirely.

WSJ Quote: Tesla Loss Widens as Spending Jumps
Luxury electric-car maker posts $154 million loss even as quarterly shipments top 10,000 cars

Bloomberg:

Tesla Falls After Morgan Stanley Calls Cash Burn˜Eye Watering™ - Bloomberg Business

So if there are bargains on open, are weeklies the best way to jump in like Fango had mentioned?

 

[uselesslogin]

Searching the dark corners of the internet for clues to this shady premarket action, and some of these wackos literally are borrowing on margin to short TSLA because they hate Elon Musk, period, and are convinced that the planned cash outlays for gigafactory construction mean Tesla will go bankrupt ASAP. That seems like a great bear thesis...

I might buy this morning as well.

I might be strange but I always thing of the strong negative short reactions to Elon and Tesla as something along the lines of this:
Revenge of the Nerds - NERDS! - YouTube

 

[Jonathan Hewitt]

So if there are bargains on open, are weeklies the best way to jump in like Fango had mentioned?

If you are a gambling man. You will probably lose it all but if you don't will make $$$$$$$$$$$$$$$$.

 

[InTheShadows]

Almost no more shares to short at Interactive Brokers.

Symbol: TSLA
Availability: 50'000

Are you serious? There's no shares to short and people are buying them on margin.

I really hope no notes are released until 9:45

 

[mrdoubleb]

Well I don`t do any of the wizardry you guys do with options and stuff, but happen to have a little cash on hand (got it yesterday) and just transferred some of it to my brokerage account. Never thought I`d say this after such a great ER/CC, but if we do dip into 220 I`m buying a few more shares...

 

[dalalsid]

European indices are rebounding strongly now and so is TSLA, from pre-market low of 216 to 224. Maybe the general negative market sentiment coupled with short attacks (apparently there's no TSLA shares to borrow at IB for shorting) pushed it so low. I'm hurting this morning with my June calls but the words that are running through my mind now is: Greedy when others are fearful.

When was this low of 216 - I missed it. Entered a buy order at 220 for tiny amount of shares, not executed.

 

[Cattledog]

Well, if all the research you did was read major news headlines or skim the articles you might be left with the impression that Tesla missed earnings and abandoned stationary storage entirely.

Bloomberg:

Tesla Falls After Morgan Stanley Calls Cash Burn˜Eye Watering™ - Bloomberg Business

So if there are bargains on open, are weeklies the best way to jump in like Fango had mentioned?

That Morgan Stanley comment is eye watering. Adam Jonas' flip-flopping is sort of bizarre. Only 3 quarters of cash at current burn rate? They just spent the majority of cash in Q1 on Fremont readying the Model X line - building is upgraded, robots bought, paint line almost operational - cash burn for Fremont diminishes for a year and a half until they build out for Model 3. They are trying to scale up massively for cars and storage at Gigafactory - or is that just a big party tent in the desert and they plan on moving Burning Man there?

 

[pGo]

That Morgan Stanley comment is eye watering. Adam Jonas' flip-flopping is sort of bizarre. Only 3 quarters of cash at current burn rate? They just spent the majority of cash in Q1 on Fremont readying the Model X line - building is upgraded, robots bought, paint line almost operational - cash burn for Fremont diminishes for a year and a half until they build out for Model 3. They are trying to scale up massively for cars and storage at Gigafactory - or is that just a big party tent in the desert and they plan on moving Burning Man there?

As I mentioned in Q1 results thread, cash burn is a concern to me. Tesla has said that they will deploy $1.5B into GF, X lines, SCs and stuff. However, they only have $1.5B in the bank. There are a few other ways they can get loans through leased cars and stuff, but that's a couple hundred M. I think there is a gap. And the way Tesla is going, I would like to have them keep at least $1B on hand anytime to cover unexpected events. I feel that money raise through secondary, cb or simple bond offering in EU is inevitable between now and X launch.

 

[RationalOptimist]

He really is an odd-ball, Jonas. I wonder if he felt insulted by something on the call? he was last to be picked for question, pushed on whether late-Q3 implied further Model X delays, and Elon didn't really answer his questions the way he might have wanted. As the guy who most helped Tesla raise the $2bn in cash last time, I wonder what he thought they'd do with it. Bank it? It's supposed to be spent. They're growing one of the world's great businesses of the 21st century. <smack forehead against wall> <repeat>