Short-Term TSLA Price Movements - 2016

[Fallenone]

Why would we throw InsideEV into the discussion about when Tesla releases numbers? InsideEV is for US only. It's a good data point for other times of the quarter but it doesn't even compare with Tesla's global delivery number at all.

 

[stealthology]

With AP 2.0 they really shouldn't announce it until it is already in recent new cars, otherwise heavy Osbourne effect if it is a few months out.

So that's the thing.. according to Electrek the hardware is ready, the software isn't ready. So a WAG could be: to stimulate sales for Q4, they could announce that all new cars now have next gen AP hardware, and a software update would activate it later on. Yeah, WAG.

 

[3Victoria]

I am in on the AP2 guess. One week line shut-down --> start AP2 hw installs.

 

[geneclean55]

Why would we throw InsideEV into the discussion about when Tesla releases numbers? InsideEV is for US only. It's a good data point for other times of the quarter but it doesn't even compare with Tesla's global delivery number at all.

Note the word 'project' in their sentence.

 

[FredTMC]

To veteran TSLA investors that personally experienced the 2013 "short squeeze" aka Tsunami of Hurt part 1(TOH1), were there pre-indications then of a stellar, profitable quarter prior to announcement? What was the mood like then and how does it compare to right now (if it can even be compared)? For me, the evidence seems to point to a stellar delivery announcement next week but somehow, the SP action seems muted in anticipation.

I bought at $35 / share and will always remember fondly the shock caused by that Pre announcement of profitability. No one saw that coming... huge shock with that Pre announcement. Tesla definitely "overdelivered"

This time things are a bit different. I think expectations are still somewhat low across all shareholders BUT there is some hope of profitability because of the leaked email.

Bottomline with me: If tesla delivers over 22k cars AND Pre announces at least non-GAAP profit then I fully expect a 10% rise in TSLA on Monday (but not more).

"Full GAAP profit" would pop the stock more than 10%. I don't think full GAAP is likely. Also, I don't think greater than 23k cars is likely.

Hope this helps

Btw: I fully expect a press release to hit pre-market Monday morning. I think it's highly unlikely that there's no announcement before market opens on Monday. That gives tesla the entire weekend to add up the deliveries. And tesla always says the deliveries have a 1% margin of error. That's ~200 cars.

 

[MitchJi]

The last few quarters delivery numbers have always come out within 3 calender days, not 3 business days. We should have numbers Sunday or Monday at the latest. I bought calls expecting a nice pop in the SP, but I have to say that I'm less optimistic now. It seems like Wallstreet is expecting the numbers but doesn't expect them to have impact because they were achieved using sale prices that can't be maintained, and they think (incorrectly) that demand will drop next quarter without lower prices. I think Wallstreet is also expecting poor gross margins because of 60kW model and the price drops. I have no doubt that TSLA is a good long term bet over the next 1-5 years, but I'm losing faith that we will see higher than 240 this year. I hope I'm wrong.

Back in early 2013, Tesla was where SolarCity is right now in terms of sentiment and short interest. It had short interest near 50 to 60%, but now around 30%.

For short interest you need to factor in the price they got in at. The one million who got in between September 1-15 are likely to be hurt.

IMO the number produced and the associated finances are critical. Tesla is under siege for not being able to produce cars. If they make a ton at a good profit I think the SP will pop,

If might not take as much as we think to produce a squeeze like effect. Between now and when the big institutions start selling shares purchased to vote there is a smaller number than normal available to buy. They could decide to keep them, or start unloading them after the Q3 ER-CC.

The SCTY acquisition is having a major dampening effect on the SP. The solar roof, TE 2 etc. might undo that. It seems to me that Elon is shooting for a substantial bump in the SP. I hope he's successful. Good luck everyone!

 

[TMSE]

-The current is a wholly different contextual than 2013. I can express a series of short markers
-Tesla was widely considered to be headed for bankruptcy by massive shorting (more than twice today and against a much smaller long base- Instutuationally and otherwise).
-The entire market (by any measure) was still in a high growth recovery state from the recession. That is no longer the case
-The short squeeze was effectively engineered against large capital gain equity offerings that Elon and other supported to help maintain he value post squeeze.(that's partially why we've also stayed flat after $200 waiting for he next major proven catalyst)
-Yes we had many on this forum who by-the-numbers had the basic squeeze time pegged based on ER etc.
But hey we're largely unexpected - Note it was a bit easier because the short activity was an order of magnitude more revealing. Even then it was months in the making
-Tesla is now in an early maturing stage and the market is at high PEs- We are definitely entering a very strong inducement for TSLA strength and short covering (more of a bear hug than a squeeze IMO)

Many of us have been strong-long TSLA from $25+
Many of those who made their mark in the 2013 squeeze are long gone

My advice is to avoid making those parallels- they won't happen again in the same way and will likely be much more fraught with fluctuation. That said imo this is a good time to be in stock long (much upward momentum over the next year)- perhaps some LEAPs. Anything else should be in discretionary funds of high risk imo. This is currently an excellent stock buying op imo.

Although I believe TSLA will move up firmly soon, I would caution that playing a 2013 squeeze correlation could be fraught with frustration. Tesla is in a massively new phase now.

my 2 pennies

While I agree that it is irrational to expect the repeat of the stock price performance in the summer of 2013, the sentiment and the pending catalysts are immensely positive for stock price appreciation in the near term:

- Vast majority of moneybags on Wallstreet, not just the paid shills on Seeking Alphalpha, firmly believe in the concept of loss/car. Their estimate is currently around $18K to $20K/ car and they expect it to be higher for Q3. They seem to have zero awareness of dynamics of large-scale manufacturing, fixed costs, variable costs, etc. Thanks to the FUD campaign by the vested interests, they are now hard-wired not to trust Tesla's non-GAAP metrics. The only way to convince them is by delivering at least GAAP breakeven profitability, at least once. GAAP is what they understand and there is no way to dispute that metric. I am not expecting the rabid shorts to cover, but the fence sitters will jump in big time. This will be the biggest catalyst near term.

- Better than expected guidance for Q4. To ensure the on-time delivery of M3 in volume, both capex and opex need to ramp up from Q4 and on. The market will continue to believe in Tesla, if the deliveries and gross margin continue to ramp up from Q3 to Q4 and further on. While it is not necessary to show positive Free Cash Flow during this phase, a breakeven Operating Cash Flow is immensely positive which should send stock price to new highs.

- Solar shingles, Powerwall 2.0, Inverter package reveal in 3 weeks. It is a wild card which I have no clue on how good or bad. The only positive sign, although perversely, is the Cogenra lawsuit in this regard. While any lawsuit is unpalatable, this at least strongly hints at the importance and relevance of SolarCity's shingles. Let us wait and see.

- M3 part 2 reveal later this year. Elon has promised us spaceship-like interior. I believe that anything novel in M3 should be a base feature in MS/MX. So, TM might spring us a surprise with refreshed interiors for MS/MX, in addition to AP2.0 this quarter. It has to be a surprise to mitigate Osborne effects. This should take the demand to crazy new levels.

- Exponential ramp up of TE powerpack deployments. We have already seen two major projects totalling in size in excess of 100Mwh. This is likely a high margin product (over 50% GM), which should contribute significantly to the top and bottom lines and obviate the need for any further capital raise beyond the impending one in Q4. Earnings call should shed some more light on this, and then market will assign a valuation for this part.

All these catalysts will materialize or at least get greater clarity in Q4. I have not seen this many catalysts all lined up so close to each other before.

-

 

[30seconds]

I can see some (10%) upwards movement between now and Q3 financials as it becomes clear that tesla has a fully viable business with the S+X that will allow a new fundraising to get to Model 3. That will give some pause to some shorts and some more certainly to some longs.

However I don't expect a large move until the market believes the model 3 is real and that the company's revenue growth has a new and large let up. Depnding on execution that could be anywhere from mid-2017 to mid-2018.

Wildcard would be X or TE sales coming in stronger than expected

 

[Xpert]

This sums it up for me, My guess is 22-23K cars delivered and at least non-GAAP profit, stock pops to $220 on monday. Good luck long, I'm fully in with Jan 2018 220 calls.

 

[MitchJi]

M3 part 2 reveal later this year., Elon has promised us spaceship-like interior. I believe that anything novel in M3 should be a base feature in MS/MX. So, TM might spring us a surprise with refreshed interiors for MS/MX, in addition to AP2.0 this quarter. It has to be a surprise to mitigate Osborne effects. This should take the demand to crazy new levels.

That will not happen!

The reason that they limited the features originally revealed is that they don't want to Osborne the MS-MX.

Announcing AP 2 HW in the existing MS-MX are a strong possibility.

 

[tander]

I bought at $35 / share and will always remember fondly the shock caused by that Pre announcement of profitability. No one saw that coming... huge shock with that Pre announcement. Tesla definitely "overdelivered"

This time things are a bit different. I think expectations are still somewhat low across all shareholders BUT there is some hope of profitability because of the leaked email.

Bottomline with me: If tesla delivers over 22k cars AND Pre announces at least non-GAAP profit then I fully expect a 10% rise in TSLA on Monday (but not more).

"Full GAAP profit" would pop the stock more than 10%. I don't think full GAAP is likely. Also, I don't think greater than 23k cars is likely.

Hope this helps

Btw: I fully expect a press release to hit pre-market Monday morning. I think it's highly unlikely that there's no announcement before market opens on Monday. That gives tesla the entire weekend to add up the deliveries. And tesla always says the deliveries have a 1% margin of error. That's ~200 cars.

To add to that, @sunhelm, I still remember sitting in a bar catching up with a friend, and glancing at my twitter which I had just recently signed up for, pretty much because I knew Musk was a "tweeter". I can't remember the exact wording I think it was on a weekend night, but I recall thinking that it was basically confirmation of a bunch catalysts I had seen coming. Did not think the result or growth would be so fast, people forget that even right now with TSLA's perceived dismal outlook and poor performance, the stock is still about 500% of what it was only about 3 years ago. I don't think this will be as extreme as 2013, but I seems like the headlines are going to switch positive pretty soon.

While I agree that it is irrational to expect the repeat of the stock price performance in the summer of 2013, the sentiment and the pending catalysts are immensely positive for stock price appreciation in the near term:

- Vast majority of moneybags on Wallstreet, not just the paid shills on Seeking Alphalpha, firmly believe in the concept of loss/car. Their estimate is currently around $18K to $20K/ car and they expect it to be higher for Q3. They seem to have zero awareness of dynamics of large-scale manufacturing, fixed costs, variable costs, etc. Thanks to the FUD campaign by the vested interests, they are now hard-wired not to trust Tesla's non-GAAP metrics. The only way to convince them is by delivering at least GAAP breakeven profitability, at least once. GAAP is what they understand and there is no way to dispute that metric. I am not expecting the rabid shorts to cover, but the fence sitters will jump in big time. This will be the biggest catalyst near term.

- Better than expected guidance for Q4. To ensure the on-time delivery of M3 in volume, both capex and opex need to ramp up from Q4 and on. The market will continue to believe in Tesla, if the deliveries and gross margin continue to ramp up from Q3 to Q4 and further on. While it is not necessary to show positive Free Cash Flow during this phase, a breakeven Operating Cash Flow is immensely positive which should send stock price to new highs.

- Solar shingles, Powerwall 2.0, Inverter package reveal in 3 weeks. It is a wild card which I have no clue on how good or bad. The only positive sign, although perversely, is the Cogenra lawsuit in this regard. While any lawsuit is unpalatable, this at least strongly hints at the importance and relevance of SolarCity's shingles. Let us wait and see.

- M3 part 2 reveal later this year. Elon has promised us spaceship-like interior. I believe that anything novel in M3 should be a base feature in MS/MX. So, TM might spring us a surprise with refreshed interiors for MS/MX, in addition to AP2.0 this quarter. It has to be a surprise to mitigate Osborne effects. This should take the demand to crazy new levels.

- Exponential ramp up of TE powerpack deployments. We have already seen two major projects totalling in size in excess of 100Mwh. This is likely a high margin product (over 50% GM), which should contribute significantly to the top and bottom lines and obviate the need for any further capital raise beyond the impending one in Q4. Earnings call should shed some more light on this, and then market will assign a valuation for this part.

All these catalysts will materialize or at least get greater clarity in Q4. I have not seen this many catalysts all lined up so close to each other before.

-

I agree totally, the bases are loaded, it looks like home plate is going to get a lot of use over the next month or so. My guess is they will release the delivery numbers and then wait until earnings to talk margins/profits, kind of a knockout punch if I stick with the sports metaphors. Another wildcard catalyst is talk of Obama pushing through a carbon tax before he leaves office, that would be big deal for Tesla even if it gets axed later, and a Clinton win is probably good for Tesla too. The other super wildcard is if the merger hasn't gone through yet SCTY will prob release earnings and I guess there's a chance they will actually be better than expected, don't know how though.

 

[DaveT]

I can see some (10%) upwards movement between now and Q3 financials as it becomes clear that tesla has a fully viable business with the S+X that will allow a new fundraising to get to Model 3. That will give some pause to some shorts and some more certainly to some longs.

However I don't expect a large move until the market believes the model 3 is real and that the company's revenue growth has a new and large let up. Depnding on execution that could be anywhere from mid-2017 to mid-2018.

Wildcard would be X or TE sales coming in stronger than expected

I largely agree with this. I'll add that I don't think necessarily the bears think Model 3 isn't real. It's more that they think Tesla can't ever make a profit with the Model 3. I don't think if Tesla shows profit for Q3 that it will change that thinking. The bears will say Tesla gamed the quarter to raise funds, and that they one-time profit should be ignored. Shorts probably won't get crushed until Model 3 turns a profit for Tesla, which won't be until 2018. The wildcard is if Tesla Energy is able to ramp fast next year and surprise with substantial revenue.

 

[stealthology]

I largely agree with this. I'll add that I don't think necessarily the bears think Model 3 isn't real. It's more that they think Tesla can't ever make a profit with the Model 3. I don't think if Tesla shows profit for Q3 that it will change that thinking. The bears will say Tesla gamed the quarter to raise funds, and that they one-time profit should be ignored. Shorts probably won't get crushed until Model 3 turns a profit for Tesla, which won't be until 2018. The wildcard is if Tesla Energy is able to ramp fast next year and surprise with substantial revenue.

The bears can say Tesla gamed the quarter with a few discounts, but I think the production numbers q/q will speak for itself. The factory appears to finally be cooperating with Model X.

 

[ggies07]

I largely agree with this. I'll add that I don't think necessarily the bears think Model 3 isn't real. It's more that they think Tesla can't ever make a profit with the Model 3. I don't think if Tesla shows profit for Q3 that it will change that thinking. The bears will say Tesla gamed the quarter to raise funds, and that they one-time profit should be ignored. Shorts probably won't get crushed until Model 3 turns a profit for Tesla, which won't be until 2018. The wildcard is if Tesla Energy is able to ramp fast next year and surprise with substantial revenue.

So which is it? First the bears said they can't be profitable at all and now maybe they could say it's gamed? Obviously Tesla should have kept quite on how they were doing so the whiney shorts can't cry about it. At this point, I'm quite tired of it all. Nothing I can do about it, but it's ****ing annoying.

 

[Turing]

"Full GAAP profit" would pop the stock more than 10%. I don't think full GAAP is likely. Also, I don't think greater than 23k cars is likely.

23k seems like a low max. As a optimistic scenario, why would it seems unreasonable for them to delivery 17k MS like they did in 2015 q4, and then add in 10k MX?

 

[3Victoria]

Its called "moving the goal posts". The antis love to play it: EVs are slow, EVs can't compete with ICE Acceleration, EVs can't compete on 0-60, EVs can't compete on the 1/4 mile, EVs can't compete on a real test track .. yada yada. Same for investors.

On the other hand, shorts depress the SP and open up great pricing for longs ... its not all bad

 

[stealthology]

So which is it? First the bears said they can't be profitable at all and now maybe they could say it's gamed? Obviously Tesla should have kept quite on how they were doing so the whiney shorts can't cry about it. At this point, I'm quite tired of their game. Nothing I can do about it, but it's ****ing annoying.

I know for a fact of one inventory sale due to the publicity Elon's e-mail got on Twitter.

Shorts are always going to have something new to say. They already caught onto the discounting and were making/were about to make a big deal of it, so Elon swiftly made his move by posting the e-mail he sent to all his employees, which included a neat little message to us of how Q3 is 'likely' going to be the best in Tesla's history. Whether Elon really didn't know about the discounting or not.. I believe him.

 

[anticitizen13.7]

So which is it? First the bears said they can't be profitable at all and now maybe they could say it's gamed?

Yes, this game of denial will continue until success is so blindingly obvious that nobody cares what the bears think anymore. If success happens, the stock will rocket up very quickly and most people will be left in the dust.

Look what happened with Apple. First it was "iPhone sucks". Then it was "Android will kill iPhone". Finally by 2011 it was: "Oh *&^$! everyone has an iPhone and profits are through the roof." Apple was flat or trading within a range for years before it became obvious they were going to win a lot of profits in mobile. For Apple, the wait was 4-5 years. For Tesla, it could potentially be much longer because the product cycle for automobiles is just a lot slower, as is the case with storage and solar systems.

I know that many people here are hoping for a beat and some big gains next week. I wouldn't count on it. Substantial gains could be 4-5 years away.

 

[AlMc]

Yes, this game of denial will continue until success is so blindingly obvious that nobody cares what the bears think anymore. If success happens, the stock will rocket up very quickly and most people will be left in the dust.

Look what happened with Apple. First it was "iPhone sucks". Then it was "Android will kill iPhone". Finally by 2011 it was: "Oh *&^$! everyone has an iPhone and profits are through the roof." Apple was flat or trading within a range for years before it became obvious they were going to win a lot of profits in mobile. For Apple, the wait was 4-5 years. For Tesla, it could potentially be much longer because the product cycle for automobiles is just a lot slower, as is the case with storage and solar systems.

I know that many people here are hoping for a beat and some big gains next week. I wouldn't count on it. Substantial gains could be 4-5 years away.

AntiC has been saying this for some time and it does bear (no pun) repeating. I think we get a nice 10-15% increase IF we have a nice beat with Q3 deliveries. Longer term, I will be happy to be wrong but doubt we see ATH until it is clear that model 3 is out on time and in good numbers.

If you are a hard core long these numbers and the FUD should matter little but don't assume 2013 is repeating itself *soon*.

 

[madodel]

Fred just smacked down the KanBan hit piece from yesterday.

Tesla’s paint shop is no bottleneck for Model 3, Tesla says ‘on track for 500,000 cars in 2018’

And based on what a lot of you have said about the paint process, I'm sold it was nothing but poorly-researched BS.

In other words a typical Kanban fact free hoax.