Short-Term TSLA Price Movements - 2016

[Intl Professor]

Did you drop a digit and really mean 115k?

Could be my brain does that occasionally. Others here will correct or I accept your correction. I thought our chances were better to get one soon before the 200,000 limit (again, potentially faulty memory) on the federal tax rebates expire for Tesla.

 

[mrdoubleb]

My (Dutch) broker "Degiro" told me I can not vote with my TSLA and SCTY shares. They do not give out proxies or any other way so their customers can vote. They stated that all TSLA and SCTY their customers have will not be voted.
I was quit surprised about this.

I hold a few 1000 shares, a lot for me but small on the full scale of the total, but as there are many Tesla customers here in NL they will have shares for other Dutch shareholders as well. Shareholders whos votes will not be counted.

BTW, thanks for the interesting ZEV discussion

Yeah I just called my brokerage in Hungary today as well. Similar answer: they do not support electronic voting, but can give me a certificate of the number of shares I own and I can go and vote in person with that. No, airfare not included...

So I called the company in the merger brochure today and asked them if I can mail my certificate and my vote to them, they said they'll look into that. Now the number of my shares compared to most of you is ridiculously low, but it would still be fun to participate...

 

[Gerardf]

Wow, again 585.000 shares after market.

After we made a strong close going up.

 

[doctoxics]

Tesla.com Model 3 page updated:

Production begins mid 2017
Delivery estimate for new reservations is mid 2018 or later​

Is this a new statement from Tesla regarding when Model 3 production begins? The quote from the Tesla Model 3 page now reads:

"Model 3 production is scheduled to begin in mid 2017."

We know that all of the supplier and production issues were to be resolved by July 1, but production was not expected to be ready to go at that time. Not sure of how much time between the start of production and the first deliveries. Perhaps only a month, with most of that for QC. We have been told all along that deliveries were not expected to begin until "late 2017". Are we to conclude that there is a new and earlier date for the delivery of the first Model 3s? Seems CNBC might have missed the real story.

 

[rallykeeper]

Incorrect, it would not have been illegal for the company to give material non-public information in such a setting, however they would need to immediately file a public disclosure of the same information. If they failed to make such a filing then it would be against Reg-FD

Agreed should have added the words "without disclosing it pursuant to Regulation FD"...

It would have been highly unorthodox though. Companies don't like to made superfluous Regulation FD disclosures.

 

[esk8mw]

Wow, again 585.000 shares after market.

Late reported trades, don't worry about them (up or down). Always keep an eye on the bid/ask spread to see if it's a current trade. When the 585k went off at 196.50, the B/A spread remained at 198.10 / 199.00.

I bet the flash crash created issues filling the rapid orders and you are just seeing them now. CNBC BS caused over 1 million shares to change hands. Grossly negligent - or worse.

 

[EinSV]

Is this a new statement from Tesla regarding when Model 3 production begins? The quote from the Tesla Model 3 page now reads:

"Model 3 production is scheduled to begin in mid 2017."

We know that all of the supplier and production issues were to be resolved by July 1, but production was not expected to be ready to go at that time. Not sure of how much time between the start of production and the first deliveries. Perhaps only a month, with most of that for QC. We have been told all along that deliveries were not expected to begin until "late 2017". Are we to conclude that there is a new and earlier date for the delivery of the first Model 3s? Seems CNBC might have missed the real story.

I believe this language is new (but someone please correct me if that is wrong).

It could mean increased confidence in the production timeline but is a bit cryptic. Especially given Elon's previous cautionary language on the nominal July 1 2017 production target I personally plan to wait for a more definitive statement before changing assumptions about production/delivery timelines.

Definitely intriguing though. Maybe we'll get more color with the ER.

 

[Ulmo]

\

My (Dutch) broker "Degiro" told me I can not vote with my TSLA and SCTY shares. They do not give out proxies or any other way so their customers can vote. They stated that all TSLA and SCTY their customers have will not be voted.
I was quit surprised about this.

I hold a few 1000 shares, a lot for me but small on the full scale of the total, but as there are many Tesla customers here in NL they will have shares for other Dutch shareholders as well. Shareholders whos votes will not be counted.

BTW, thanks for the interesting ZEV discussion

Online reviews of that brokerage are very bad:

9 things I hate about DeGiro

 

[racer26]

For those interested:

My Canadian Model 3 reservation, reserved online within a minute or two of reservations opening reads the following in MyTesla right now:

Your Model 3 was reserved on 3/31/2016. Production is planned to begin in 2017. You'll be invited to configure based on the date of your reservation. If you have any questions, please refer to our FAQ. We invite you to submit suggestions or feedback within our forums. Engage with other future owners to share your excitement or ideas. To withdraw your reservation, you may request a cancellation

 

[CALGARYARSENAL]

What a day! It will pale in comparison to tomorrow and earnings.

 

[racer26]

$1500 / $5000 = 0.3, i.e. 30 pennies on the dollar.

Once again, neither your rationale nor the numbers work:

Zero Emission Vehicle Credits


View attachment 199064

Its pretty easy to match up the buyers and sellers there and figure out that it was Tesla selling to FCA, Ford, and Honda

 

[Gerardf]

\
Online reviews of that brokerage are very bad:
9 things I hate about DeGiro

Yes, I knew they offer limited trading features. I am a long term "buy and hold", for that they have low costs.

However not allowing me to vote now frustrates me, and I would be interested to move to Fidelity or IB, also to profit from shorts borrowing my shares. If anybody has experience moving to them as a European shareholder, please PM me.

 

[JBRR]

Yes, I knew they offer limited trading features. I am a long term "buy and hold", for that they have low costs.

However not allowing me to vote now frustrates me, and I would be interested to move to Fidelity or IB, also to profit from shorts borrowing my shares. If anybody has experience moving to them as a European shareholder, please PM me.

+1

 

[austinEV]

What a day! It will pale in comparison to tomorrow and earnings.

I think earnings will be the thing. Tomorrow, whatever it is, will be a "meh" from the market. Elon could announce a software update that reduced tire wear by 90% and the market wouldn't care. Similarly I think this will be Mr. Market's take:

• HUD/Glass features: just a product feature. Doesn't make money right now, who cares.
• A/P 2 HW, or productized A/P: Just a product feature. Doesn't make money right now. If A/P is being productized it will be valued at zero, just like TE is now.
• New vehicle? Just more talk of future dreams.

Again, not my opinions, just cynical short term market takes. I do NOT think there will be a "sell the news" event because there is no run up on the anticipation and we are already at the lower bound of range bound trading. Plus earnings next week is exerting it's more powerful gravity up or down.

 

[drinkerofkoolaid]

Wouldn't it be interesting if Tesla reveals specifications for the Model 3 and number of reservations? Anyone else think Tesla will begin accepting preorders or reservations for the Powerwall/Powerpack 2.0 to demonstrate how high demand for the product will be prior to the vote? This will shut up the naysayers and prove the merger makes a lot of logical and financial sense.

Some have said Tesla already has 300,000-500,000 reservations for the Powewall/Powerpack.

SolarCity was granted a number of additional patents over the past few weeks.

Patents by Assignee Solarcity Corporation - Justia Patents Search

 

[W84M3]

Yes, I knew they offer limited trading features. I am a long term "buy and hold", for that they have low costs.

However not allowing me to vote now frustrates me, and I would be interested to move to Fidelity or IB, also to profit from shorts borrowing my shares. If anybody has experience moving to them as a European shareholder, please PM me.

I'm in the same boat and honestly did not know they don't allow us to vote.

 

[brian45011]

We've discussed the ZEV topic some time ago. Guys, don't get over-excited about it.

While I believe each ZEV credit was worth $3-4k in the past until 2016 Q1, the current value of ZEV I believe is near zero. Yes, I mean it, near zero.

The reasons are two facts:
1. ZEV requirement for model years 2009 through 2011 was 11%, 2012 through 2014 was 12%, 2015 through 2017 was 14%.
https://www.arb.ca.gov/msprog/zevprog/zevregs/1962.1_Clean.pdf

This was the plan made several years ago. A clear uptrend. Many OEM can't meet the current requirement so they have been buying ZEV from others, Tesla being the biggest source. The price was good ($4k maybe), basically the net profit of their best profit making models. During this time frame, other OEMs also accumulated a surplus, in anticipation of increasing requirement.

2. But, in mid this year. CARB came out with the plan for 2018 and beyond. Guess what, the requirement for 2018 model is 4.5%. A 68% decrease. It will not be until 2022 when the requirement climbs back to 14.5%.
https://www.arb.ca.gov/msprog/zevprog/zevregs/1962.2_Clean.pdf

This suddenly changed everything. The surplus other OEMs sitting on is good enough for the next few years. The value of ZEV is near zero because there's no need for it. That's where the "penny on dollar" comment from Elon came from. Sure, Tesla can still sell the ZEV, but at a huge discount compared to the few k before. I think it is under $100 now.
.

I suspect you are misinterpreting the ZEV regulations. Prior to 2018, the ZEV percentage could be met by a combination of low emission vehicle types:, PZEVs, AT PZEVs, TZEVs, Type 0s, or NEVs and ZEVs. While the 2017 "Total ZEV Percent Requirement was indeed 14%, the minimum "pure" ZEV type was 3%, and the rest could be made up of credits from other types low emission vehicles. Read carefully paragraph D on page 5 on your first link above.

In 2018, the minimum (floor) "pure" ZEV type drops from 3% to 2%, but several of the other types of low emission vehicles can no longer be used to meet the "Total ZEV Percent Requirement", just TZEVs (Yes the Total % dropped from 14% to 4.5%) As your second link above illustrates that minimum "pure" ZEV type percent rises dramatically from 2% in 2018 to 16% in 2025, while the ratio of TZEVs allowed to meet the Total drops.

Everything is in the "eye of the beholder", but IMO ZEV credits are becoming increasingly valuable--which explains why OEMs are increasingly offering "compliance cars" in jurisdictions that follow the California's regime (~12 other states). Look at where the Bolt is being offered.

As far as Elon's complaint on the CC, I think it had more to do with FCEL vehicles and "fast refueling" extra credits. Initially, no car had to be actually "re-ranged" within the time criterion to claim extra fast refueling credits; all that was required was for the manufacturer to assert the car was capable of meeting the criterion. Protests about the actual environmental benefits of that caused modifications to the criteria. Now extra credits for BEVs are going away. Tesla's opportunity to earn extra fast refueling credits by running the same car through the Harris Ranch battery swap station multiple times in order to earn several extra credits on 25 other cars goes away at year end.https://www.arb.ca.gov/regact/2015/zev2015/zev15notice.pdf

What's the right estimate for how much is added to the bottom line in 3Q16? Dunno, but 2 observations:

The 80,227 credits sold in FY2015 was through 8/31/2016. September 2016 was Tesla's highest delivery month ever. How many additional ZEV credits were sold in September?

GHG/CAFE revenue reported has been:

1Q13 $17.1 million
2Q13 $17.9 million
3Q13 $14.8 million
4Q13 $14.8 million

1Q14 $11.6 million
2Q14 $15.8 million
3Q14 $17.0 million
4Q14 $20.0 million

1Q15 $15.0 million
2Q15 $13.0 million
3Q15 $16.0 million
4Q15 $12.7 million

1Q16 Not Reported
2Q16 Not Reported
3Q16 ?????

 

[esk8mw]

According to this Article current market price for ZEV credits is $3,000 - $4,000:

"But the Toyota Mirai and the Honda Clarity will pay off handsomely in credits — nine of them for each sale, compared to four credits the state now gives a Tesla Model S or the three it gives a Nissan Leaf.

The credits are currently worth about $3,000 to $4,000 each, according to a source with knowledge of the private credit-trading market among automakers."

So far, I can't find any better information than that article re: ZEV pricing. It's notable that the article was published on 9/1, after the reporting period ending 8/31 showing Tesla sold 80,000 credits and well after the reduced standards Fallenone noted. Since Tesla is one of the few (or the only?) manufacturer in a position to sell credits, I have to assume the 3-4k figure cited in the article's source is inclusive of the massive amount of Tesla selling credit that occurred prior to the date of the article. Assume a volume discount and I'm inclined to stick with my 2500 estimate.

Back to the pennies on the dollar thing. I think it was hyperbole for purposes of arguing his position bc Elon was clearly trying to make a statement to CARB that would get in articles (which they did). If I used to be able to sell something for 5k and suddenly they were worth 2500 (a 50% reduction) due to my competitors lobbying to be allowed to pollute more with fewer consequences, I'd be pretty pissed off too.

If I wanted to dust off the old tinfoil hat I could also craft an argument where Elon is trying to hide the Q3 effect of the ZEV credit sales (which he knew would be published before earnings) by overstating the worthlessness of the credits. After all, we know he's been engineering this monster quarter for quite some time. I think the prior hyperbole point is much much more likely, though.

 

[Turing]

I think earnings will be the thing. Tomorrow, whatever it is, will be a "meh" from the market. Elon could announce a software update that reduced tire wear by 90% and the market wouldn't care. Similarly I think this will be Mr. Market's take:

• HUD/Glass features: just a product feature. Doesn't make money right now, who cares.
• A/P 2 HW, or productized A/P: Just a product feature. Doesn't make money right now. If A/P is being productized it will be valued at zero, just like TE is now.
• New vehicle? Just more talk of future dreams.

Again, not my opinions, just cynical short term market takes. I do NOT think there will be a "sell the news" event because there is no run up on the anticipation and we are already at the lower bound of range bound trading. Plus earnings next week is exerting it's more powerful gravity up or down.

While this is certainly possible. I think A/P 2 HW and partnership with nvidia to replace mobileye could potentially give us some bounce, as it will be seen as a real demand lever and also fostering Tesla's real world lead in driver assist systems. I wouldn't expect large movement though.

 

[Curt Renz]

The CNBC effect:

View attachment 199057

Volume too. Some pockets got picked today...

One may wonder why CNBC auto industry reporter Phil LeBeau was not the first one there to report the Tesla update. Well, he probably would not have reported it, since the true story was not really much news. My guess is that the CNBC “science” reporter Robert Ferris was fed a misleading interpretation of the Tesla update by a short seller, and Ferris became anxious to publish a scoop. Any other guess as to Ferris’ motivation or inattentiveness might be seen as even more unkind. CNBC really needs to address this.