Short-Term TSLA Price Movements - 2016

[uselesslogin]

Still no evidence Sig's are done shipping and production Model X is ready to go until mid February. This is they key for Q1 approaching FCF. Without Model X in volume, there is no FCF. If there are only 1000 or 2000 Model X in Q1, they won't be profitable. If they aren't ramping up by earnings, then forward guidance will be discounted. Communications for X customers still seems spotty, so getting news about Model X production getting locked down and scaling up is THE key short term issue.

I don't see any signs of a big ramp - even in VIN assignment. Production VINs are only in the 800s. One owner in the Model X tracker reports a 3/1 estimated delivery date. So I am thinking FCF positive would have to wait until Q2. OTOH, if they could be FCF positive with only 2-3,000 Model X deliveries that would make the stock skyrocket.

 

[dc_h]

+1
They need to focus on financial performance now. Tesla needs to focus on operations and cash flow.

Yes, a few million for Q1 really makes a lot of difference for the company. Putting it in context, model X has been delayed three times and in the process, Elon broke his promise three times. FCF is also delayed from Q4 2015 to a promise of Q1 2016. If they still can't keep the FCF Q1 2016 promise, Elon and the company will further lose credibility, making the task of raising capital to accelerate their growth a lot harder, particularly in the current macro market environment. We are comparing a dozen or two of Supercharger and a few billion dollars for model 3 production and GF investment here. It's a no brainier to halt the construction of superchargers for now.

 

[electracity]

They have a 180 price target for Dec 2016 yeah I'd say that is horribly pessimistic. As far as the market is concerned, I'm on record as saying nothing Tesla can do will please the market at this point. Incredibly frustrating and something is up.

The market is very pleased with tesla. This is shown in the price based on future profits from a nonexistent inexpensive future electric car. If the market decides that Tesla is just another manufacturer with perhaps some upside potential, TSLA will be 20.

 

[MikeC]

My thought was that Superchargers were maybe on hold after the Norway fire. Explains some of the slowdown this year. As far as undiscovered Superchargers, I know Redondo Beach and Burbank were discovered well into construction and this is in Los Angeles where there are tons of owners.

 

[FredTMC]

Yes, a few million for Q1 really makes a lot of difference for the company. Putting it in context, model X has been delayed three times and in the process, Elon broke his promise three times. FCF is also delayed from Q4 2015 to a promise of Q1 2016. If they still can't keep the FCF Q1 2016 promise, Elon and the company will further lose credibility, making the task of raising capital to accelerate their growth a lot harder, particularly in the current macro market environment. We are comparing a dozen or two of Supercharger and a few billion dollars for model 3 production and GF investment here. It's a no brainier to halt the construction of superchargers for now.

I hear what you're saying, but honestly, reducing Capex expense at GigaFactory build-out in Q1 can have a far far greater impact

Literally, tesla can defer/delay spending 10's of millions (or more) on the GF construction in Q1.
Keep in mind, we would likely never know what they are really spending there in a given quarter. It's largely invisible to us and subject to speculative reporting.

Finally, I definitely agree that Tesla is going for positive FCF in Q1'16 (now). I would be shocked if tesla didn't reaffirm FCF for Q1 on Earnings Call on Feb 10th

 

[Lump]

WTH is going on with this stock?!!! Anytime a stock tanks on no news I get nervous-like who knows something. Technically this stock is in the dog-house and wanting to touch the 52 week low. I am losing my rear end and it isn't fun with the market going up. So let's see oil up should equal tesla up-false! Market up tesla up- false!

Sales in China were projected to be on par with North America & the EU, possibly becoming the largest market, today after the hype clears & reality of import tariffs not being waived for Elon, news of projected sales of 5000 units for 2016 is another disappointment for the nondelusional TSLA investor.

 

[Buddyroe]

Yes, a few million for Q1 really makes a lot of difference for the company. Putting it in context, model X has been delayed three times and in the process, Elon broke his promise three times. FCF is also delayed from Q4 2015 to a promise of Q1 2016. If they still can't keep the FCF Q1 2016 promise, Elon and the company will further lose credibility, making the task of raising capital to accelerate their growth a lot harder, particularly in the current macro market environment. We are comparing a dozen or two of Supercharger and a few billion dollars for model 3 production and GF investment here. It's a no brainier to halt the construction of superchargers for now.

Wow. That is probably one of the saddest things I have read about Tesla in a long time. I don't disagree with you - or agree. I'll just say this. If Tesla has gotten to the point where it has to stop building the VERY infrastructure that is needed for it to grow and prosper - after having the Model S being a stunning success that NOBODY dreamed it would be - then this goes to show what a TERRIBLE decision Musk made to pursue the falcon wing doors on the X (along with the self-presenting doors and fancy second row seats). It's sad when a company has to stop building the very thing that will make it grow - to save a few million, when they spent HUNDREDS of millions designing features that no one is sure people even want. No one is going to specifically buy the X because it has falcon wing doors (well, not enough for it to even matter), but a LOT will not buy it because of those doors (worry about functionality, and long-term problems with them). Man, that dang car would have been out a year earlier and with a couple hundred million dollars in the bank to boot.

I'd have TEN MILLION times rather seen Tesla build 400 supercharger sites than to put those doors on the X. Geeees, SUVs sell like hot cakes these days and NONE of them have falcon wing doors. Just a horrible, HORRIBLE decision.

 

[lango]

I know this guy has been off a few times in the past on Tesla. But this one sounds like a reasonable negative argument.

http://www.forbes.com/sites/bertels...nt-be-a-made-in-china-tesla-car-anytime-soon/

Any thoughts?

Would be interesting to know what requires "a factory" and what they need to do to reduce the import taxes.

 

[esk8mw]

We are rapidly approaching maximum negative sentiment on this thread. I think we just need one long-time holder to announce exit of all TSLA positions and that should do it.

In other words, time to buy more...

 

[aznt1217]

Would be interesting to know what requires "a factory" and what they need to do to reduce the import taxes.

Probably similar to Norway's where assembly happens there.

 

[The Blue Owl]

I know this guy has been off a few times in the past on Tesla. But this one sounds like a reasonable negative argument.

http://www.forbes.com/sites/bertels...nt-be-a-made-in-china-tesla-car-anytime-soon/

Any thoughts?

Musk never said "there will be a factory in China by mid-2016", he said (according to Benzinga) that "he is looking to 'lock down' manufacturing plans by 'finding a local partner and a location for the plant -- for the local market by middle of this year.'". South China Morning Post says that "he confirmed that Tesla is investigating options for local production on the mainland this year and hopes reveal more details in mid-2016". Other outlets extrapolated from there.

At most, one can say that the author has a valid argument about over-enthusiastic claims by media outlets, but not about Tesla or Musk.

 

[Fallenone]

I'm not saying they stop building it. I'm saying they just stop building it for this quarter. With the ramp up production of X, they can more than compensate the halt for this quarter in the next quarter.

Wow. That is probably one of the saddest things I have read about Tesla in a long time. I don't disagree with you - or agree. I'll just say this. If Tesla has gotten to the point where it has to stop building the VERY infrastructure that is needed for it to grow and prosper - after having the Model S being a stunning success that NOBODY dreamed it would be - then this goes to show what a TERRIBLE decision Musk made to pursue the falcon wing doors on the X (along with the self-presenting doors and fancy second row seats). It's sad when a company has to stop building the very thing that will make it grow - to save a few million, when they spent HUNDREDS of millions designing features that no one is sure people even want. No one is going to specifically buy the X because it has falcon wing doors (well, not enough for it to even matter), but a LOT will not buy it because of those doors (worry about functionality, and long-term problems with them). Man, that dang car would have been out a year earlier and with a couple hundred million dollars in the bank to boot.

I'd have TEN MILLION times rather seen Tesla build 400 supercharger sites than to put those doors on the X. Geeees, SUVs sell like hot cakes these days and NONE of them have falcon wing doors. Just a horrible, HORRIBLE decision.

 

[electracity]

The issue with the gigafactory probably isn't what Tesla is currently spending. It is what Panasonic is currently spending. I assume Panasonic's "investment" will not be on Tesla's balance sheet. Perhaps this is incorrect.

Tesla has built out a million square feet. If Panasonic isn't aggressively building production in their portion, I would want to know why. A positive reason for "feet dragging" would be that Panasonic/Tesla R&D has them rethinking the batteries they will be making.

 

[Matias]

We are rapidly approaching maximum negative sentiment on this thread. I think we just need one long-time holder to announce exit of all TSLA positions and that should do it.

In other words, time to buy more...

Again?

 

[farzyness]

Again?

Again.

 

[Blip]

Probably similar to Norway's where assembly happens there.

This is wrong. Teslas are not assembled here (in Norway). The import tax is 0.00 for all electric vehicles (zero emission-).

 

[uselesslogin]

It doesn't work that way!
Put–call parity - Wikipedia, the free encyclopedia

Put-Call Parity And Arbitrage Opportunity | Investopedia

I just was thinking about this and now remember what people were saying about 2013 and cheap calls. The reason calls get cheaper is because if the fee rate to short is high then one can turn to a stock replacement strategy of selling a call and buying* a put to short the stock. And you can look right now and see the J18 @190 PUT costs more than the call. Conversely a long can sell the put and buy the call ATM and they will get like a $10 credit so it is sort of like owning the stock at $180/share. Shorts are happy to pay that $10 credit because to short the actual stock they have to pay 8%, not the equivalent 3% or so that difference represents.

*edit - buying not selling..

 

[Drax7]

Wow. That is probably one of the saddest things I have read about Tesla in a long time. I don't disagree with you - or agree. I'll just say this. If Tesla has gotten to the point where it has to stop building the VERY infrastructure that is needed for it to grow and prosper - after having the Model S being a stunning success that NOBODY dreamed it would be - then this goes to show what a TERRIBLE decision Musk made to pursue the falcon wing doors on the X (along with the self-presenting doors and fancy second row seats). It's sad when a company has to stop building the very thing that will make it grow - to save a few million, when they spent HUNDREDS of millions designing features that no one is sure people even want. No one is going to specifically buy the X because it has falcon wing doors (well, not enough for it to even matter), but a LOT will not buy it because of those doors (worry about functionality, and long-term problems with them). Man, that dang car would have been out a year earlier and with a couple hundred million dollars in the bank to boot.

I'd have TEN MILLION times rather seen Tesla build 400 supercharger sites than to put those doors on the X. Geeees, SUVs sell like hot cakes these days and NONE of them have falcon wing doors. Just a horrible, HORRIBLE decision.

Agree, unless those doors are insanely desirable which is hard to believe in my limited understanding.

 

[Yggdrasill]

The supercharger slowdown could be explained by something as simple as needing every available charger for the record-breaking Model S production in Q4. Each supercharger needs 12 chargers, each 8 stall supercharger station needs 48 chargers. If you have 20 superchargers under construction globally, that's 960 chargers. Not insignificant.

This could also tie in with the new Model X charger. Maybe we will see a redesign of the Model S and/or superchargers to use the Model X charger?

 

[Blip]

Uselesslogin: You probably ment selling put and buying calls.
... Or the opposite to short...