Very nice. At the end, he states that Volvo has an objective of "...bringing 100 self-driving cars to our customers in 2017". Now that's ambitious!
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Very nice. At the end, he states that Volvo has an objective of "...bringing 100 self-driving cars to our customers in 2017". Now that's ambitious!
dandurston
Member
Here's a crazy suspicion that just might be true:
SCTY's NPV of their 20-30 year cashflows is based on a 6% discount rate. In the past they've sold off portions of this instead of letting the cash trickle in monthly, but always for well above 6% such that people are skeptical of the value of what remains since it should arguably be discounted a higher rate. Since the terms of their PPAs are so long, a change of 1 or 2% in the discount rate per year is huge for the NPV. I think they closed a deal for about $300 million worth of their PPA cashflows at ~8% about 6 months ago and then another deal at about 7.4% about 2-3 months ago. They said future deals would be better but no one believed them. On the contrary it appeared like no one wanted SCTY cashflows even at bad rates for SCTY, and thus SCTY could face a liquidity crunch when shorter term debt is due.
Now in the last month or so they've closed 2 big deals for about $300 million each but not disclosed the terms of the deal (e.g. discount rate, net price per watt). My hunch is that the terms of these deals are actually much better (e.g. 5.5 - 6%) and SCTY/TSLA are keeping this a secret for their Nov 1 presentation. If they show they can sell off portions of their PPA base for at or better than their estimated value, then it solidifies the value of the rest of their installed base and their ability to liquidate it as needed for immediate cash flow. That's huge for having cash available and for avoiding liquidity crunches.
I could easily be wrong.
SCTY's NPV of their 20-30 year cashflows is based on a 6% discount rate. In the past they've sold off portions of this instead of letting the cash trickle in monthly, but always for well above 6% such that people are skeptical of the value of what remains since it should arguably be discounted a higher rate. Since the terms of their PPAs are so long, a change of 1 or 2% in the discount rate per year is huge for the NPV. I think they closed a deal for about $300 million worth of their PPA cashflows at ~8% about 6 months ago and then another deal at about 7.4% about 2-3 months ago. They said future deals would be better but no one believed them. On the contrary it appeared like no one wanted SCTY cashflows even at bad rates for SCTY, and thus SCTY could face a liquidity crunch when shorter term debt is due.
Now in the last month or so they've closed 2 big deals for about $300 million each but not disclosed the terms of the deal (e.g. discount rate, net price per watt). My hunch is that the terms of these deals are actually much better (e.g. 5.5 - 6%) and SCTY/TSLA are keeping this a secret for their Nov 1 presentation. If they show they can sell off portions of their PPA base for at or better than their estimated value, then it solidifies the value of the rest of their installed base and their ability to liquidate it as needed for immediate cash flow. That's huge for having cash available and for avoiding liquidity crunches.
I could easily be wrong.
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Runarbt
Active Member
You have got that right. Everything Elon says is lies, and tweets and Product infor is "pumping SP". The delusion is strong in those ones. :-D
Its not Worth it spending time arguing. Impossible to get any where when everything Tesla informs about, even ER is seen as lies and deception.
“Never argue with stupid people, they will drag you down to their level and then beat you with experience.”
― Mark Twain
Since you stated in your second post that you intend to buy into TSLA at some point, consider your timetable with this stock and how high you expect it to go within that time frame. If you plan to put some of your Model 3 money into TSLA stock and you believe the stock will go to 280 before mid-2018 (a conservative estimate in my opinion), then the difference between a buy-in at 185 and a buy-in at 200 isn't all that great. The downside of waiting for the perfect price is that TSLA could run up substantially in the week that follows the ER and you have lost your reasonable buy-in opportunity. Consider buying in with a portion of your money before the ER. If the stock price runs uphill like a P100D with the pedal to the metal, then you will be happy you did so. If your fears are realized and the stock actually goes down after the ER, then you are well-positioned to move the rest of your TSLA investing money into the stock when you believe it has bottomed out and it's ready to go back up again (but again I would recommend splitting that buying into multiple entry points).
The truth is that none of us can consistently call the bottom or the top of the short-term stock price. What smart investors tend to do is spread out their buying and spread out their selling to reduce the probability of getting skunked, one way or the other.
Also consider that investing in TSLA is not for everyone. You really have to believe in the ability of this company to execute if you are going to stomach the occasional dives the stock tends to make. If you are likely to sell when there's an unexpected development then you can easily sell below your purchase price and that's not a good thing. Take a look at three years of TSLA trading and you'll see that every year there are nice high points and every year there are scary low points. If you're likely to sell at a low point, this is not the kind of stock you should be in.
I was fortunate to have paid for my first Model S with TSLA stock earnings while waiting for my car (it was also a lllooonnnggg wait back then). Wishing you similar success, but keep in mind that once this train leaves the station you'd be amazed how quickly the ticket prices escalate.
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RobStark
Well-Known Member
He said $35k for the Model 3 BEFORE incentives and at least 215 miles EPA range.
He said $50k for Model S AFTER US Federal incentives and made no promise on EPA range. Tesla delivered,late but delivered. Customers wanted P85+ not S40.
adiggs
Well-Known Member
Why there is no "short and hold"
I had a long walk this afternoon, and was thinking about "buy and hold", and why shorts are so active. It all comes down to the fact that they have so much more to lose. Now, intellectually I knew this already. The disclaimers all stress that your losses as a short are theoretically unlimited. However I didn't have a real, visceral, understanding of what you might consider to be "normal" losses for shorting versus "longing"
Here is my thought experiment. New Fangled Startup Co (NFSC on NASDAQ) is currently trading at $30 per share. Alice holds 100 shares. Bob borrows them to short sell, and here I'm going to ignore completely that he has to pay interest to someone to borrow them, since he thinks he's going to make a killing in the next few weeks. (Also he has to pay any dividend that gets issued, but NFSC doesn't pay dividends yet.) Christine buys those shares. Bob received $3000 from Christine, and Christine now has perfectly good NFSC shares, even down to voting rights. Bob, despite having the cash, has an obligation to buy back those 100 shares at some future time, but that doesn't worry him because he's going to make a killing at the next ER in a few weeks. Note that both Alice and Christine have shares of some value, and don't have any kind of deadline associated, so even if the price goes down, they can be relatively relaxed about it. They don't incur the actual loss until they sell, and they don't have to sell (at least not because the stock price moves).
NFSC releases their new Auto-fangle product, and look to be on track for a good ER. Indeed the ER comes around and they make a surprise profit, and the stock goes up to $40 (a 33% increase, rounded). Great! Alice is very happy, her stock went up 33%. Same for Christine. But wait, this is the same stock, the value of 100 shares went up by $1000, for two people, that is $2000, at the same time as the market cap adjusted value of the shares only went up $1000. Where does the other $1000 come from? Of course, Bob lost it. Bob still has his $3000, but also has the obligation to buy stock that will now cost him $4000, and he will have to realize that loss at some future time, not very far in the future. In fact, it's not even under his control when he will have to do that, since Alice might decide to pocket her profit by selling her shares at any time, and Bob (or someone else) has to buy the shares NOW, well, within 3 days anyway. At some time soon, Bob has to come up with $4000, but he only got $3000 in the first place. Suppose he closes his position now, he ends up having lost $1000, that came from somewhere. What percentage of his investment is that?
Here's Bob's dilemma: relative to the $3000 that appeared out of nowhere, that loss is 33%. No surprise there. But we don't know how much he started with. Suppose he started with $2000 in his account. His broker lets him do that, since the total in his account after the short sale is $5000, with a concomitant obligation to buy $3000 worth of margin-worthy stock; same net value of $2000. After NFSC stock goes up to $40, though, the situation has changed. Now the net value of his account is only $1000, and he has that obligation, and now the margin value of the stock he has to buy isn't covered by his net account value. So he gets a margin call at the worst possible time, and has lost half of his account value. It isn't under his control any more.
In the meantime, Bob isn't alone, lots of other suck... err, people, were in the same position of having to buy NFSC stock on the open market. So while the deal is unwinding, the price goes up another $10, to $50. Bob's account is now empty, and his broker isn't returning any calls...
Alice and Christine are smiling, thinking how lucky they were to have held on to make 67% on their investment. It's a startup, and they are dreaming of a ten-bagger. Think about what happens to Bob and the other shorts if that happens.
It's even worse for Bob. Not only does he have to buy the 100 shares when the margin call comes, he has to find an owner of the shares that is willing to sell them. If the longs all think the company is still undervalued at $40, Bob's offer to buy 100 shares at the $40 market won't do the trick. What if he offers $50? $60? Surely somebody will sell!
I don't see this as all that big of a deal most of the time, with most companies. But what about when the company has 1500 shares in the market, and 300 shares have been shorted? There are happy owners of 1800 shares in the market, and a whole bunch of missing seats for people to jump into when the music stops.
BTW, I bought one of those $50,000 Model S cars (after federal tax credit) but added a few options onto it. This summer I sold my 2013 Model S 40kwh Tesla with 43,000+ miles on it for about $12,000 less than I paid (tax credit considered). I didn't spend a penny on energy because I grew my own on the roof. Including maintenance, I spent about 30 cents/mile for depreciation, energy, and everything else. Not bad for a luxury car in a size where the energy cost alone for a big ICE approaches 20 cents/mile and is a whole lot more in Europe.
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Thanks @ggr for the excellent post on short selling!
This does point out the fact that short sellers do bring greater liquidity to the market. If Alice had no incentive to lend out her shares (make interest), then Christine would not be a happy owner right now. Now I understand why Wall Street so defended short selling vs the Government, during the peak of the recession in the 2008-09, ultimately only giving up naked short selling (at that time I did not).
FWIW, one day out of curiosity I was researching Chanos' Edgar filings. He has one Long fund with around 48 stocks (one of which is Toyota), and approximately 8, likely short funds (with money invested, more funds if you include the ones which are non-funded). The way I could guess which are the short funds is that the short funds have no information on holdings. I cross checked with Stanphyl Capital (m.speigel's fund), which also has identical Edgar paperwork showing no holdings. It just has a couple of order of magnitude less moneys invested than Chanos. I was just curious to see if the Edgar filings would show what short positions Chanos had taken, answer: NO.
I could be wrong (and when it comes to these things it seems I often am), but it seems that if you run a short fund you have a bit of a tactical advantage in not having to disclose what you're doing.
Although I guess if you're trying to drive prices down, it's less an advantage...then I guess what you do is you arrange to be on CNBC.
This does point out the fact that short sellers do bring greater liquidity to the market. If Alice had no incentive to lend out her shares (make interest), then Christine would not be a happy owner right now. Now I understand why Wall Street so defended short selling vs the Government, during the peak of the recession in the 2008-09, ultimately only giving up naked short selling (at that time I did not).
FWIW, one day out of curiosity I was researching Chanos' Edgar filings. He has one Long fund with around 48 stocks (one of which is Toyota), and approximately 8, likely short funds (with money invested, more funds if you include the ones which are non-funded). The way I could guess which are the short funds is that the short funds have no information on holdings. I cross checked with Stanphyl Capital (m.speigel's fund), which also has identical Edgar paperwork showing no holdings. It just has a couple of order of magnitude less moneys invested than Chanos. I was just curious to see if the Edgar filings would show what short positions Chanos had taken, answer: NO.
I could be wrong (and when it comes to these things it seems I often am), but it seems that if you run a short fund you have a bit of a tactical advantage in not having to disclose what you're doing.
Although I guess if you're trying to drive prices down, it's less an advantage...then I guess what you do is you arrange to be on CNBC.
I'm pretty sure, nVidia's hardware is way more than 500. Here Electrec claims that list price is 15 000 USD (Sic!). I don't believe that it is that much either, but most likely some four digits figure.
All new Teslas are equipped with NVIDIA’s new Drive PX 2 AI platform for self-driving
They're using a high-end GPU, that's all. Calm down. Apparently neural networks don't that THAT much power or transistors to run. It's a lot but by current standards fairly middle of the road stuff.
As discussed elsewhere, I think Tesla is using the same underlying GPU core, the GP102 or variant, but not the actual Drive PX2 modules themselves. Therefore NVIDIA can claim the same platform, but Musk referred to it as the Titan. Since Tesla is writing their own software stack completely that is portable between multiple processors, combined with the much lower number of sensors including the lack of LIDAR to process, Tesla can use a far cheaper hardware solution.
I could not find estimated pricing of the GP102 itself. Given that the retail price of a Titan X is $1,200, and unclear if Tesla needs the same size and speed of memory for AI processing, I suspect the price per chip is under $500. So the hardware cost over AP2 is somewhere around $1,500 to $2,000. Now, it may be that at the limited quantities that Tesla sells as compared to consumer electronics, it might actually be cheaper for Tesla to equip all cars with AP2 hardware than only those that order it. Especially before Model 3 volume hits its stride.
phigment
Member
Keep in mind that a one off dev kit is often more expensive than buying individual chips and building your own solution.
Here's a (really poor) example:
A dev kit for a "Microschip MEC1418 processor": $281
http://www.digikey.ca/product-detai...gy/EVB-MEC1418MECC/EVB-MEC1418MECC-ND/6208212
The single chip: $3.41 in quantities of 100
http://www.digikey.ca/product-detail/en/microchip-technology/MEC1418-NU/MEC1418-NU-ND/5323474
there are 2 stock splits i love to remember.
I missed on this one. (bought at $30, sold at $40) then
AMER became AOL which split -->> 144x <<-- to peak at $100 ($14,400) / share (missed ALL those)
AXPW (John Peterson's) reverse splits 1:for 35, then 1:50 then 1:400 for a cumulative 1 share for 700,000 shares (and it is still under 1 cent)
It's intriguing to watch, from a distance
(weekends are for kibitzing? correct? otherwise apologies)
Post 2:1 split or Post 3:2 split?
That was the development kit, IIRC, which are always pricey. Nvidia wants to make development boards generally available, but they don't want to support amateurs.
MitchJi
Trying to learn kindness, patience & forgiveness
I hope that they show that there's a substantial boost to MS-MX profits from the new AP Hardware.
I'm part way through trying to figure out how much Tesla probably paid for Drive PX's. With the heavy duty radar processing that Tesla is doing it seems possible to me that they are using the most powerful Drive PX 2 available (there is a whole line of Drive PX 2 chips). According to Nvidia the highest end versIon has the equivalent power of six Titan X processors that sell for about $1,300 each, quantity of one. The same power on one integrated chip should cost less. Also Tesla isn't using the API. Elon said that they had a close decision between nvidia and AMD. I'm sure part of the equation was price, so I believe that Tesla could negotiate a good price. The other part of the price is the added sensors plus enhanced radar. I think it's possible that they are paying as much as $1-1.5k additional for the new hardware. Still very profitable given that I think that the take rate on the AP will be close to 90%.
They are increasing their profits, increasing the demand and creating a moat for full autonomy all at the same time! One of the primary obstacles to full autonomy is collecting data that proves the safety and Tesla not only has that benefit from every car that they sell, but they are providing the full safety suite with every car sold. It's a brilliant strategy! I'll post more later. The only problem is that writers, and analysis and much of the market is not smart enough to figure it out!
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And what @Fallenone is saying, is that it is possible that no one wants the base model 3 either and that the $35 model gets scrapped 3 months in.
I very much doubt this. Just examine the difference in demographics between those that can stretch to $30k and those that can stretch to $50k. Also, the usability 40 kWh Model S versus the usability of the base Model 3 is vastly different... then add in the difference in upgradability to Supercharging. I suspect quite a few will opt to forgo AP, and certainly autonomous AP.
3Victoria
Active Member
If no one orders a base 3, then Tesla cannot be faulted for not building them, although EM did say the base would bethe best car one can buy for $35k. Also, I think Tesla has many ways it can mitigate the extra cost of AP.
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