Short-Term TSLA Price Movements - 2016

[MitchJi]

Decided the ER is too uncertain and I have been known to hold on too long expecting for 'big' returns.

Me too, whichh is why I asked.

I do expect a good Q3 but while we may get some 'color'on how that looks from EM on the Q2 CC, we won't have firm numbers until early Octobet.

My (just formulated) feelings are that the Q2 ER won't have a big negative impact. We are iclearly IMO in a new phase now. I'm not sure how long it will last. Make hay while the sun is shining?

A few months ago every minor problem would trigger a significant hit to the SP, and minor catalysts had little to no effect. Now the SP is shrugging off problems, or even bouncing when there's a problem.

Warning: I'm really bad at determining short term TSLA prices. Please don't make any trades based solely on my opinions.

 

[racer26]

A few months ago every minor problem would trigger a significant hit to the SP, and minor catalysts had little to no effect. Now the SP is shrugging off problems, or even bouncing when there's a problem.

Yep. Thinking the SP has reached maximum FUD saturation. Further FUD doesn't seem to do much.

 

[MitchJi]

Yep. Thinking the SP has reached maximum FUD saturation. Further FUD doesn't seem to do much.

I think it's more than that. Further minor material news doesn't seem to do much. But I wouldn't bet the farm on it.

 

[Yggdrasill]

I think it's more than that. Further minor material news doesn't seem to do much.

I agree. These last three days TSLA has been magnetically attracted to the 228-229 range. Someone wants it to stay there.

 

[MitchJi]

Tesla, Mobileye split likely caused by Tesla wanting to go its own way: Morgan Stanley

Tsla, Mobileye split likely caused by Tesla wanting to go its own way: Morgan Stanley

Tesla Motors Inc. and Mobileye N.V. ““divorce” was not surprising, but Mobileye’s investors should brace for shrinking market share and thinner margins for the Israeli company, Morgan Stanley said in a note to clients Thursday.

Mobileye’s MBLY, +0.55% share in advanced driver assistance systems is likely to fall to 50% by 2029, from 80% currently, said analyst Adam Jonas.

For Tesla TSLA, +0.34% the split was likely motivated by a desire to go its own way, he said.

“Tesla views having a mastery of its own proprietary autonomous driving suite (including vision) as critical to its long term success and sustainability,” Jonas said.

The parting of ways is likely to have been under consideration for many months, and a recent fatal accident involving Tesla’s Autopilot is unlikely to have contributed to the decision, he said.

“We also do not believe the split was due to any material deficiency in the capabilities of the (Mobileye) system but was more likely related to differences in strategic direction and pace of development in the areas of automated driving and possible questions over the sharing of proprietary data,” he said.
<Snip>

 

[1208]

Seeing as Deutsche Bank is doing a Lehman brothers and in several months will be "Kaput" what effect will this have on TSLA?

 

[tinm]

Tesla, Mobileye split likely caused by Tesla wanting to go its own way: Morgan Stanley

Tesla's developing a case of "Not Invented Here" syndrome, so commonplace in tech companies constantly faced with build-or-buy decisions. Often they start out with buy, so they can get to market faster, but then their requirements, specs, plans, or egos outgrow what they bought from a third party, so they decide, time to build our own. Nothing wrong with that, until it gets out of hand.

 

[tander]

My biggest concerns are:

- lowered guidance (covered in earlier post, shouldn't come as a surprise)
- stagnant margins (not likely, IMO, still pumping out high price X with resolve ramp issues toward end of quarter, 60 introduced too late to knock margins down)
- EPS miss due to ramped SGA costs/OpEx/CapEx but timing of deliveries didn't make end of quarter as expected (biggest fear is this, but cash flow from ops due to ABL from masive deliveries in transit - plus model 3 reservation cashflow - should factor in to show a very shiny number there)

It's very much a wildcard. I keep going back and forth as to expected outcome of the call.

Quarterly earnings for companies that are basically planning for 10-20 years out are kind of a waste of time IMO, but this is the short-term thread after all. Here's my take; expectations are fairly low for this earnings already, even Jonas of Morgan Stanley has pretty modest things to say (my guess is he's trying to get some credibility back after some of his crazy previous upgrades and to sort of prepare for future big upgrades). The numbers won't be great, it was already priced in when they released deliveries back in early July, and it wouldn't be surprising if they even fall below expectations. That said it wouldn't be that surprising if they sold zev credits and batteries and the numbers don't look that bad either. But ironically I think Q2 might be beside the point for the Q2 earnings.

Firstly because Q3 guidance is probably going to be really good considering the ramp is pretty well through now and battery sales should be ramping quite a bit too. They might even decide to let loose how many deliveries happened in July if they are on track to make the high end of yearly guidance or more. Secondly, they were supposed to release more details about the merger a week or two ago. I would guess they'll shift most of the conf call focus onto the merger, and the analysts will be so focused on Q3 and the merger. They could keep pushing it out of course, but this is just my hunch. With more info on the merger analysts should be able to figure out why it makes sense, and very positive guidance and maybe even a little proof of July deliveries, it looks like things will probably be pretty good coming out of next week. Of course Musk could always throw a wrench in things and talk too much about capital raises or amphibious future vehicles for discovering burried unicorn dna in the mariannis trench, or my assumptions could just be wrong.

 

[Calvin.K]

Loving the higher lows, hoping this trend continues into the close!

 

[jhm]

So this is curious. The TSLA-SCTY spread has widened today from around $4 yesterday to $9.15 right now. Tesla is trending up while SolarCity has dropped low.

Are there any short-term issues that would account for that divergence? Anything that might compromise confidence in the acquisition?

 

[Jayjs20]

Loving the higher lows, hoping this trend continues into the close!

That's a long shot. Just wait an hour and "those people" will come around and hammer it back to 228

 

[ev-enthusiast]

I still like my popcorn.

 

[JBRR]

Earnings Preview: Tesla Motors Q2 2016 (TSLA) - Selerity Global Insight

 

[Papafox]

How can a short manipulate prices downwards if there aren't hardly any shares left to short like in the current market?

While Fidelity and some brokerages have gone zero available shares of TSLA to short, other brokers have some. Further, the low availability of TSLA shares to short is a revolving door. Every day, some shares are freed up and some more are taken. For those selling in to protect their existing short positions through creative selling into new positions, it makes sense to sell into TSLA in rather large lumps at strategic times to discourage buyers bidding TSLA higher.

As an example, yesterday TSLA started up quite heavily, but did a u-turn and after dipping into the red it traded horizontally in a narrow band for most of the remainder of the day until some additional selling pushed TSLA down another 50 cents during the final half hour. Yesterday could have been a much more positive day for TSLA if not for efforts to keep the stock just below the starting price for the day. There was ambiguity in the gigafactory message (10s of billions for SMP2 was the negative, gigafactory ahead of schedule, M3 pencils down and on schedule, and 25% estimated GM for M3 being the biggest positives). By keeping TSLA slightly red, the story told was that the market looked somewhat negatively on the gigafactory event, when the opposite was true. Thus, we have the positive trading of TSLA today without much help from broader markets because TSLA is running up today like it wanted to run up yesterday but was toned down by the creative short-selling. If you see a stock being artificially held down and shorts running out of ammo to continue the effort, that's a bull signal in my book and we're seeing the results today.

Edit: We could see a tug-of-war at 230 today, not because longs see it as a big resistance point but rather because shorts, if they can find additional shares, will use creative selling to bop TSLA down whenever it sticks its head above 230. You may even see a drop below 230 in the last 5 minutes of trading, and it will not be because longs are selling.

 

[Calvin.K]

That's a long shot. Just wait an hour and "those people" will come around and hammer it back to 228

I know its not likely but this is the strongest trend I have seen in the last few days. It looks like it wants to go higher.

 

[ev-enthusiast]

I still like my popcorn.

Added some good cheese and a glas old red wine, funny combination with popcorn.
BTW I still like what I see.

 

[steve3]

So this is curious. The TSLA-SCTY spread has widened today from around $4 yesterday to $9.15 right now. Tesla is trending up while SolarCity has dropped low.

Are there any short-term issues that would account for that divergence? Anything that might compromise confidence in the acquisition?

I've also been watching that trend all morning... a bit unanticipated, but since volume is so thin, chalked it up to folks taking profits ahead of upcoming Q2 ER. I still love my purchase of 410 shares at 24.29 to get the last 50 shares of TSLA that I wanted for long-term holding at a nice discount.

 

[jhm]

I've also been watching that trend all morning... a bit unanticipated, but since volume is so thin, chalked it up to folks taking profits ahead of upcoming Q2 ER. I still love my purchase of 410 shares at 24.29 to get the last 50 shares of TSLA that I wanted for long-term holding at a nice discount.

That's interesting. Both ERs are on the same date, right? After the ER, the stocks should reconverge regardless of the outcome of the respective ERs. So the situation can create some short-term volatility in spread owing to ER trading reacting as if these companies are not really linked entities. That is, short-term the market forgets the merger, but a few days later it will remember the merger and shrink the spread. This could create some interesting spread plays for merger-savvy traders.

 

[esk8mw]

As in recent days, volume has been quite small. The last time I commented on the light volume and boring price movements the SCTY buyout was announced a few hours later and the SP and volume went nuts.

I wonder what kind of event my comment can trigger this time? hmm...

 

[Dwdnjck]

Try rubbing your stomach with one hand and patting your head with the other.