Short-Term TSLA Price Movements - 2016

[mrdoubleb]

All things considered we got through the past 2 weeks extremely well. Having said that, we do owe it to a couple of things:

• The biggest TSLA investors and the most important analysts kept the faith in Elon/Tesla.
• There are no more shares to short right now.
• At the 200ish levels, the 400k M3 reservations, 500k cars in 2018, a booming TE business, turning around SCTY and stable 2k+/wk SX production is simply not (fully) priced in. There is still a lot of upside - TSLA below 200 is just stupid.
• A lot of people believe Tesla will reach all of the goals above, but do not trust the timeline anymore, so they hold and wait.

On a completely unrelated note, I just noticed my last post was my 1000th, and it was made almost exactly on the 3rd anniversary of me joining TMC (missed it by 1 day). Yaaaay! Also, big thanks to all the longtime contributors for building such a great community!

 

[sub]

TSLA is becoming downright boring, a year ago we would have been down 10-15% today.

Lots of shares traded after hours today.

 

[MitchJi]

Purely speculation:

The MM are holding SolarCity around $25, and Tesla around $220 until the deal is finalized. SolarCity will merge with Tesla. The safest and fastest way for SolarCity to realize its optimal value is to merge with Tesla. Furthermore, Tesla will profit tremendously from merging with SolarCity once SolarCity's optimal value is realized.

Once the deal is complete, Elon will hold a long press conference to explain the reasons the deal makes sense. Maybe around July 31st?

The deal will not be completed for 2-3 months. When due diligence is completed in 2-3 weeks they will explain the details of why the deal makes sense, before the voting.

If TSLA had perfectly predicted every quarter and hit every quarter and avoided every stumble it would be worth 300-400 IMO. Which is why on one hand quarterly misses "don't matter in the long run" they are still very annoying for stockholders. There is really no reason they couldn't execute their manufacturing and just "fix" their predicting machine (turn it down!). Guide lower, hit guidance, profit. Drives me crazy they insist on guiding too high.

$300-$400. Annoying?! Ugh!

It's perfect for me if the SP is about $230-$240 in November or December so I can load up on J19's LEAPS at a great price!

 

[Papafox]

I can understand longs coming in and holding the price up. The up side potential within the next 2 years is substantial. But what the hell are shorts thinking? It can't be that retail shorts contributing that much, and can't be that smart money adding short positions at these fairly low levels. The only way I can explain this for myself is that TSLA is simply being used as a leveraged hedge against things unrelated to Tesla story.

You're asking the right question. My answer would be two-fold:
1) the smarter shorts left this stock prior to Friday
2) the current shorts are follow-the-leader types who actually believe the drivel that Bloomberg, Wall Street Journal, L.A. Times, Barons, etc. tell them. "Tesla loses money with every car they make." The good news is that some of the current batch of shorts will figure things out soon enough and begin their exit, which will help raise the SP, which will encourage other shorts to leave, which will... you get the picture.

Edit:
If shorts don't start exiting in an orderly fashion, then we truly are getting set up for the MOASS (mother of all short squeezes).

 

[Causalien]

Just bouncing off ideas...If none of the negatives that you listed existed, wouldn't TSLA be well north of 300 today? Infact those are the reasons for the suppressed stock price I would think. Given that the stock is already beat up (relative to where it should be), it is hesitant to go lower. Do you see fault in this logic?

Pure TA trading wise, when I see this price action this morning, I'd try to get out of my short term short. Strength into doom and gloom means some news is spreading.

2 days of this strength generally confirms it. Another possibility is that the algos have not been programmed to follow delivery numbers. This is a big possibility as we've seen previously. Delivery number barely moves so, but cash burn at quarterly earnings report did.

"IF" we don't have all these negativity, We'd have production rate of 100k model s and 100k modelx as well as cashflow positive.

But if we live in that world, Brexit would not have happened, Europe would not be facing overflowing refugee problems and Ford would have an EV that outperforms ModelS

 

[dha]

This article being blamed for the after hours slump. Pretty scant on details: Southfield art gallery owner survives Tesla crash

 

[SBenson]

This article being blamed for the after hours slump. Pretty scant on details: Southfield art gallery owner survives Tesla crash

No less from Detroit!

 

[tftf]

No less from Detroit!

Must be a hit piece. Nothing is wrong with Autopilot, the system is years ahead.

The people involved in crashes just didn't read the user manuals properly.

 

[dc_h]

What a surprising market reaction. I admit to being very pessimistic on Sunday, expecting to be down 10% today. Thinking it through, I can see continuing cause for both bear and bull arguments, perhaps now more than ever. The bears are chowing down on delivery and production miss and hoping it signals falling demand and as a sign of future performance. The bears also see SCTY as a cash-hole that will suck up funds needed for M3 and speed up Tesla's race to zero. Nothing but a financial hole in the ground, and Elon selling SpaceX to Boeing to raise cash to dig TSLA out.
The bulls may be sad that today was not short squeeze Tuesday, but see new production base at 2000 with plateau at 2200 for Q3 and 2200 baseline for Q4, with plateau of 2400. Meeting the 80-90,000 target. Bulls are also hoping for another meal at the end of July with signals for GF production. If Tesla makes 85,000 cars and starts producing PowerPacks in the 100's per quarter, Tesla could have 10 billion in revenue in 2016. If they can pull that off, they can pay for future GF updates out of cash flow and any temporary SCTY cash flow issue is not relevant. The bulls see a company on track for 15-20 billion in revenue in 2017, producing 115,000 Model S/X and another 25-50,000 Model 3 cars and TE sales of 2-5 billion. For this you get Tesla on sale for the same price as the 2013 $3 billion TSLA.

I'm long Tesla and looking forward to a Model 3 delivery in 2017 or early 2018. The way I'm seeing things this afternoon, Tesla can miss delivery targets every quarter through 2020 and still be a 100 billion company.

 

[JRP3]

From the article:

There's not enough evidence to indicate that Tesla's Autopilot malfunctioned.

 

[drinkerofkoolaid]

Almost positive there is a lot more to this story that was not mentioned or was intentionally omitted. The Detroit "Free Press" has not been very accurate when covering Tesla related events. The newspaper claims the officer stated he was told autopilot was on. Would an officer tell a newspaper this type of "information" before all of the information has been collected?

A bit interesting that the Detroit Free Press is the only newspaper covering this. Why would a Detroit based newspaper be the first and only newspaper to report on an accident that happened in Pennsylvania?

I wonder if this is the same person.

Dale Vukovich

Attorney general: No charges against trooper in chief beef

 

[esk8mw]

I think the more important news here is that someone survived a rollover crash in the Model X at highway speeds. Good job, Tesla engineers.

 

[Jayjs20]

And back up we go, currently back to 213.98

Honestly, I wouldn't have been surprised if we were 15% down today. Only being down 1.16%, some of that being the broader market being down a little, is very surprising. Gotta say, as someone who's just a normal investor and not someone who's super deep into the details, seeing TSLA be down only 1.16% gives me a kind of confidence in the stock that no announcement or article can give.

 

[MitchJi]

The bulls may be sad that today was not short squeeze Tuesday, but see new production base at 2000 with plateau at 2200 for Q3 and 2200 baseline for Q4, with plateau of 2400. Meeting the 80-90,000 target. Bulls are also hoping for another meal at the end of July with signals for GF production.

If Tesla makes 85,000 cars and starts producing PowerPacks in the 100's per quarter, Tesla could have 10 billion in revenue in 2016. If they can pull that off, they can pay for future GF updates out of cash flow and any temporary SCTY cash flow issue is not relevant.

The bulls see a company on track for 15-20 billion in revenue in 2017, producing 115,000 Model S/X and another 25-50,000 Model 3 cars and TE sales of 2-5 billion. For this you get Tesla on sale for the same price as the 2013 $3 billion TSLA.

Ron Baron's estimates on revenue and cash needs are pretty close to your bull thesis!:

Baron's bullish view is based on a projection for Tesla to increase sales from about $4 billion in 2015 to $8 billion to $9 billion this year, and around $20 billion next year. He also believes much of the company's high spending now will pay off more handsomely in the future than investors anticipate. Even as bears criticize Tesla for not reporting profits yet, Baron believes the company's high level of spending will actually prove to yield a "capital light" model in comparison to incumbents in the auto industry. Baron cites management's recent narrative that it believes it can get more production out of its Gigafactory and its car factory than originally anticipated.

Baron’s excitement about Tesla comes from the company’s transition towards becoming a capital-light company. Baron explains that while the previous capital investments were large compared to their return, the production facilities are either out-producing what had been expected to produce or are able to expand at a cost which has a large return on capital. He gives the example of Tesla’s Gigafactory which cost $5 billion and can now produce enough batteries for 1.5 million cars as opposed to the 500,000 batteries that it had been expected to produce.

 

[brian45011]

I wonder if this is the same person.

Dale Vukovich

Attorney general: No charges against trooper in chief beef

That's just bush league. What is your agenda in dredging up an alleged impropriety against an investigating state trooper from nine years ago for which the charges were dropped? Let's hope you never need assistance from an emergency responder

 

[MitchJi]

As to Lumps criticism of Baron:

His fund's $300 million position understates his bullishness on the stock, he explained.

Tesla -- I am so excited about this. But, unfortunately, I can only have $300 million invested in it because it's one-and-a-half percent of our assets -- less than one-and-a-half percent. ... I think in this one investment we can make $6 or $7 billion in profits in the next 10 or 15 years.

1. He is forced to invest in about 60 companies.

2. I use his analysis, not for fresh strategic insights, but for another possible confirmation of things I already suspected. He has meetings and tours every year so he has much better access to information than any of us, and there's no reason to doubt his ability to do basic financial analysis.

 

[CALGARYARSENAL]

My buddy just texted me pissed off that his buy limit order wasn't filled today. LOL. I told him to brace for impact and he was excited to start a large position. Didn't happen.

 

[jhm]

With any cars marked "inventory", has Tesla's build to order model changed?

Does anyone hear know Tesla's operational definition for an "inventory" car? It is a very vague term that could rightly be applied to all vehicles within Tesla's possession. My hunch is that this is a car that will be used as loaner in service, while a "marketing" car goes to the showroom or is used for test drives. But I'll admit that I am only guessing at that. If someone knows a Tesla employee, perhaps they could ask.

 

[Jayjs20]

Ron Baron expects TSLA to grow 20 times over in the next 10-15 years? Isn't that a little much?

 

[CALGARYARSENAL]

Ron Baron expects TSLA to grow 20 times over in the next 10-15 years? Isn't that a little much?

Not with Teflon Musk at the helm!