Short-Term TSLA Price Movements - 2016

[RobStark]

Is the Buffalo plant mostly funded by the NY state? How much is their commitment? How much is the spending so far/ commitment by SolarCity?

New York State is paying 100% of the original quote for the plant and factory equipment.

Solar City is responsible for any cost overruns. Building is almost complete and equipment has been ordered. Have not heard of any overruns yet.

I remember( but not 100% sure) New York State budgeted $750M for the project and Solar City $150M for cost overruns.

Solar City will lease for $1 per year for next 20 years. Once it hits its revenue and hiring minimums it has the option of expanding the plant with equipment to 5X the original size at New York taxpayer expense.

 

[JBRR]

Hilarious video of Teslabjørn "showrooming" Optimus Prime! • /r/teslamotors

I haven't seen any production car ever attract this much attention.

 

[MitchJi]

New York State is paying 100% of the original quote for the plant and factory equipment.

Solar City is responsible for any cost overruns. Building is almost complete and equipment has been ordered. Have not heard of any overruns yet.

I remember( but not 100% sure) New York State budgeted $750M for the project and Solar City $150M for cost overruns.

Solar City will lease for $1 per year for next 20 years. Once it hits its revenue and hiring minimums it has the option of expanding the plant with equipment to 5X the original size at New York taxpayer expense.

Thanks! That's huge!

 

[TMSE]

New York State is paying 100% of the original quote for the plant and factory equipment.

Solar City is responsible for any cost overruns. Building is almost complete and equipment has been ordered. Have not heard of any overruns yet.

I remember( but not 100% sure) New York State budgeted $750M for the project and Solar City $150M for cost overruns.

Solar City will lease for $1 per year for next 20 years. Once it hits its revenue and hiring minimums it has the option of expanding the plant with equipment to 5X the original size at New York taxpayer expense.

Well, that is a great deal for SolarCity indeed!

Elon thinks big and will ensure that the Buffalo plant is built to at least 5X the original size. The NPV of this contract alone should be around $3 billion!

His 'no brainer' comment makes much sense to me now.

 

[MitchJi]

I started a thread in the M3 forum that some of you might want to participate in:
Fund a big percent of your M3 purchase by buying Tesla Stock

 

[LargeHamCollider]

Hilarious video of Teslabjørn "showrooming" Optimus Prime! • /r/teslamotors

I haven't seen any production car ever attract this much attention.

That is pretty amazing.

 

[Quesder]

No related to short term SP, but this ElectroMagnetic Drive Engine seems to be the business that Elon Musk cannot miss. I bet he reads 100 times more information about it than I do.
Nasa lab to publish 'impossible' fuel free EmDrive paper

Basically this engine does consume any fuel, but uses BATTERY to generate electricity and create thrust to push ROCKET. SOLAR PANEL can be used to charge the battery. It is expected to send the SPACE ship to MARS in 10 weeks.
Look at the capitalized keywords. Which other company on earth is more suitable than TESLA to do this? Who else on earth is more suitable than Elon?

That said, by the time he wants to work on this, we might have to worry whether the merger of TESLA and SPACEX is creating any FUD and pulling the SP down.

PS. this engine is supposed not to explode, but the battery may self-burning...

 

[Zhelko Dimic]

You are incorrect. He said that the fastest conventional car factories produce one car every 27 seconds and that alien dreadnaut 3.0 would produce cars 5 to 10 times faster. He said that the M3 line at Fremont would reach AD V0.5 in 2017. V0.5 should be able to shave about one sixth of the difference between five times as fast as 27 seconds, (under six seconds) and 27 seconds or 23.5 seconds. I used 25 seconds which is conservative in every way.

But Freemont is not at 27 sec now, is it? Those are best existing factories.
Freemont is at about 100 sec now. (calculation assumes 48 weeks, 5x12 work hours weekly, 100K cars produced)

 

[MitchJi]

But Freemont is not at 27 sec now, is it?

Obviously not.

I guess you don't understand.

I think if you read the transcripts it'll be clear to you.

 

[MitchJi]

Musk said in the email that Tesla is "on the razor's edge of achieving a good Q3, but it requires building and delivering every car we possibly can, while simultaneously trimming any cost that isn't critical, at least for the next 4.5 weeks."

IMO it's a safe assumption that this means that in Q3 Tesla will have enough deliveries to be at least close to cash flow positive.

 

[Drivin]

The estimated deliveries were 3,125 for August and 2,150 for July. Tesla delivered 5,125 sedans in the first two months of the quarter. The numbers show quarter-over-quarter (Q/Q) increase of 163%."

That is wrong.
The increase is 64%.
There was an increase of 2000 cars which is 64% of 3125.

Moderator Edit: Are you sure you're talking about the quarter?

 

[Oil4AsphaultOnly]

No related to short term SP, but this ElectroMagnetic Drive Engine seems to be the business that Elon Musk cannot miss. I bet he reads 100 times more information about it than I do.
Nasa lab to publish 'impossible' fuel free EmDrive paper

Basically this engine does consume any fuel, but uses BATTERY to generate electricity and create thrust to push ROCKET. SOLAR PANEL can be used to charge the battery. It is expected to send the SPACE ship to MARS in 10 weeks.
Look at the capitalized keywords. Which other company on earth is more suitable than TESLA to do this? Who else on earth is more suitable than Elon?

That said, by the time he wants to work on this, we might have to worry whether the merger of TESLA and SPACEX is creating any FUD and pulling the SP down.

PS. this engine is supposed not to explode, but the battery may self-burning...

Ummm, no. That's not how it works, as a matter of fact, there's a test satellite being launched next year to prove whether OR not it would even work. There are many ideas (I won't use the word theory here, because that debases the scientific use of "theory") about how it is working, and terrestrial tests of it "seem" to show it producing thrust, but physicists are all saying that it should NOT work and that there's some mistake with current test setups.

And in space, there's non-stop (assuming not in the shade) access to the sun in the year, so batteries are not necessary to the function of this electric thruster.

 

[FredTMC]

It's neither a single person operation nor a well-informed source. It's a website that pays $5 a pop for copy editors in India to rewrites articles about companies listed on the stock market. Then they pay google for their articles to show up on the Google Finance newsfeed of these stocks. Over half of "their" TSLA articles are rewrites of electrek.

Look at just the past few days:

Tesla Motors Inc (TSLA) Opens its First 20-Stall Supercharger in Nebbenes, Norway

"Electrek reported" then they change a few words in the article.

Tesla Motors Inc (TSLA) Head Of Data Science Jumps Ship For Emerging Local Rival

"according to Electrek"

They never link back to the original report. They are a plague and the publishing industry and make it harder for anyone actually doing any real reporting work...

Thx. I knew it was something boiler room like that. Stealing others content and posting for clicks

 

[AlMc]

Off topic...but in the States it is a holiday weekend: Anyone seen Johan recently??

 

[vgrinshpun]

IMO it's a safe assumption that this means that in Q3 Tesla will have enough deliveries to be at least close to cash flow positive.

Elon actually gave a definition of what " a good Q3 is":

“The third quarter will be our last chance to show investors that Tesla can be at least slightly positive cash flow AND profitable before the Model 3 reaches full production.”

I am kind of surprised that nobody seemingly picked up on this pretty precise definition. The implications are:

1. The concerns of just one good quarter, followed by crappy ones is unfounded. The combination of profitability and being cash flow positive is not likely to happen before scaling up M3 production - absolutely no new information here, but what Elon said actually does not mean that there will be no profitability after Q3.
2. Concerns about demand not being there to sustain 2K+ production rate (based on VIN counting) did not materialize. It would not be possible to be close to be profitable AND cash flow possible if average production was less than 2K cars per week.
3. Concerns about demo car sales, addition of 60kWh and deployment of other demand levers reducing margins (as compared to what they were in prior quarters and to what company guided to) are unfounded. I posted about this few times in this thread before - to me it was absolutely clear that deployment of the demand levers was and is a *planned* activity, and as such company guidance on margin was inclusive of all these demand levers.
4. The good Q3 as defined above proves the point that company is profitable and cash sustainable if growth is dialed back to a common for the industry low single percent level. After all the majority of expenses that can be pushed to Q4 *are* likely associated with accelerated M3 launch. This would be a major blow to the bear argument ("a pie in the face" mentioned by Elon)
5. I will leave discussion about what coincidence of good Q3 and recall of shares before record date could do to the SP out of this post and to your imagination, just because it can put an undue stress on one of our members...

 

[TrendTrader007]

Elon actually gave a definition of what " a good Q3 is":

“The third quarter will be our last chance to show investors that Tesla can be at least slightly positive cash flow AND profitable before the Model 3 reaches full production.”

I am kind of surprised that nobody seemingly picked up on this pretty precise definition. The implications are:

1. The concerns of just one good quarter, followed by crappy ones is unfounded. The combination of profitability and being cash flow positive is not likely to happen before scaling up M3 production - absolutely no new information here, but what Elon said actually does not mean that there will be no profitability after Q3.
2. Concerns about demand not being there to sustain 2K+ production rate (based on VIN counting) did not materialized. It would not possible to be close to be profitable AND cash flow possible if production was less than 2K cars per week.
3. Concerns about demo car sales, addition of 60kWh and deployment of other demand levers reducing margins (as compared to what they were in prior quarters and to what company guided to) are unfounded. I posted about this few times in this thread before - to me it was absolutely clear that deployment of the demand levers was and is a *planned* activity, and as such company guidance on margin was inclusive of all these demand levers.
4. The good Q3 as defined above proves the point that company is profitable and cash sustainable if growth is dialed back to a common for the industry low single percent level. After all the majority of expenses that can be pushed to Q4 *are* likely associated with accelerated M3 launch. This would be a major blow to the bear argument ("a pie in the face" mentioned by Elon)
5. I will leave discussion about what coincidence of good Q3 and recall of shares before record date could do to the SP out of this post and to your imagination, just because it can put an undue stress on one of our members...

 

[TrendTrader007]

Elon actually gave a definition of what " a good Q3 is":

“The third quarter will be our last chance to show investors that Tesla can be at least slightly positive cash flow AND profitable before the Model 3 reaches full production.”

I am kind of surprised that nobody seemingly picked up on this pretty precise definition. The implications are:

1. The concerns of just one good quarter, followed by crappy ones is unfounded. The combination of profitability and being cash flow positive is not likely to happen before scaling up M3 production - absolutely no new information here, but what Elon said actually does not mean that there will be no profitability after Q3.
2. Concerns about demand not being there to sustain 2K+ production rate (based on VIN counting) did not materialized. It would not possible to be close to be profitable AND cash flow possible if production was less than 2K cars per week.
3. Concerns about demo car sales, addition of 60kWh and deployment of other demand levers reducing margins (as compared to what they were in prior quarters and to what company guided to) are unfounded. I posted about this few times in this thread before - to me it was absolutely clear that deployment of the demand levers was and is a *planned* activity, and as such company guidance on margin was inclusive of all these demand levers.
4. The good Q3 as defined above proves the point that company is profitable and cash sustainable if growth is dialed back to a common for the industry low single percent level. After all the majority of expenses that can be pushed to Q4 *are* likely associated with accelerated M3 launch. This would be a major blow to the bear argument ("a pie in the face" mentioned by Elon)
5. I will leave discussion about what coincidence of good Q3 and recall of shares before record date could do to the SP out of this post and to your imagination, just because it can put an undue stress on one of our members...

sorry for the last post i just joined today and trying to get familiar with this site. i am impressed by your analysis and feel for the shorts
another way to put it would be that Tesla shares have rather limited downside and unlimited upside
why? for several reasons
rapidly growing company expanding into several business lines with an extremely dedicated genius CEO who owns 28% of stock and it is well known that Elon does not suffer fools/shorts gladly
it is extremely unlikely that Tesla will not realize all the ambitions laid down by Elon in MP Deux
Tesla will get all the funding it needs in Q4 and beyond
personally, i would be extremely wary of shorting this super dynamic company with an approx 28% short interest
any bit of unexpected good news (like the leaked email or upcoming Q3 delivery #s in OCT will set the stock on fire with a huge meltUP
just my 2 cents

 

[GoTslaGo]

Off topic...but in the States it is a holiday weekend: Anyone seen Johan recently??

Saw him post something after the spaceX explosion. He said he was extremely busy and hadn't been able to follow things. Suggested he will tune back in once he catches up on things.

 

[vgrinshpun]

sorry for the last post i just joined today and trying to get familiar with this site. i am impressed by your analysis and feel for the shorts
another way to put it would be that Tesla shares have rather limited downside and unlimited upside
why? for several reasons
rapidly growing company expanding into several business lines with an extremely dedicated genius CEO who owns 28% of stock and it is well known that Elon does not suffer fools/shorts gladly
it is extremely unlikely that Tesla will not realize all the ambitions laid down by Elon in MP Deux
Tesla will get all the funding it needs in Q4 and beyond
personally, i would be extremely wary of shorting this super dynamic company with an approx 28% short interest
any bit of unexpected good news (like the leaked email or upcoming Q3 delivery #s in OCT will set the stock on fire with a huge meltUP
just my 2 cents

Welcome to the Forum. Totally agree with your thinking. As a word of caution, though, as much as there is a lot of clarity on Company's fundamentals, there is precious little on the short term SP movements because there are so many forces in play, with a lot of them not organically tied to the fundamental value of the company. Please tread carefully and exercise prudence.

 

[Zhelko Dimic]

Obviously not.

I guess you don't understand.

I think if you read the transcripts it'll be clear to you.

I get what Elon said, but i don't get how you so confidently make conclusions you make.

You're chopping diff btw. 27 sec and 10 times quicker (2.7s) into 6 linear pieces to come to 23.5 seconds that you round up to 25s.
But Tesla is not at 27s, it's at 100s and wants to travel to 2.7s.

I see difference in starting point (100s vs 27s), and whatever model you choose for approximating rate of improvement (hockey stick, S curve, percentage increase) their common characteristics is that they start slower than linear