Short-Term TSLA Price Movements - 2016

[JRP3]

Forward thinking Green Mountain Power sees benefits from customers going off grid using Tesla Powerwalls In Vermont, Solar, Batteries Key Energy Revolution
http://abcnews.go.com/Technology/wireStory/vermont-solar-batteries-key-energy-revolution-44393762

It used to be anathema for utilities to encourage customers to disconnect from the power grid. But spokeswoman Kristin Carlson said if the company can reduce the miles of line it has to run to homes and businesses in remote places, it could be a cost savings to everyone.

"This off-grid suite of products illustrates very well where energy is going and for us at GMP. We are leading the revolution toward clean, affordable, local and highly reliable power," Powell said.

 

[brian45011]

As of September 30, 2016 we had recorded a cumulative gain of $19.2 million to AOCI related to our outstanding foreign currency cash flow hedges.

It appears that nearly 75% of that cumulative gain was used to reduce COGS during 3Q16. 10Q page 6:

"Reclassification adjustment for net gains included in net income (loss) (14,246)"

 

[AlMc]

There's a reason why they call it (options) "a suckers bet." Buy shares...

Depends on your outlook. Shares are considered less risky than options but if used properly options can be a valuable tool to investors.

 

[N5329K]

Forward thinking Green Mountain Power sees benefits from customers going off grid using Tesla Powerwalls In Vermont, Solar, Batteries Key Energy Revolution

If standalone systems benefit utilities, then utilities should pay for and be allowed to rate base them.
Robin

 

[drinkerofkoolaid]

Nice article! Hopefully with the New Year we'll see more like this -- people stepping back and realizing that BEVs are coming soon.

Will also be interesting to see how the market digests the significance of Supercharger v.3, especially as more details are released. This should wipe out the last major reason to buy an ICE -- a 10-15 minute recharge on long trips (guesstimate) would basically be the time it takes to gas up and go to the bathroom or buy a drink or snack. A new article from Electrek today highlights this point. Tesla’s upcoming ‘Supercharger V3’ is the last piece of the EV adoption puzzle – and means more ZEV credits

The market for ZEV credits won't become flooded if other companies in the USA are unable to sell competitive EV's at sufficient volume, especially when automobile manufacturers are pushing Trucks and SUVs. Also, the mandate becomes stricter over time meaning more credits will be needed over time. There is nothing Trump can do about this! If Trump tries to hurt EV sales, California will strengthen the mandate and other states will fight back.

I'm 100% sure the Chevy Bolt will never be produced at significant volume and I have a hard time believing GM has a plan B. It took GM ~ 5-10 years to bring the Volt to market.

 

[brian45011]

There is nothing Trump can do about this! If Trump tries to hurt EV sales, California will strengthen the mandate and other states will fight back.

I'm not making any predictions because the Chumpster is a loose cannon, but you might want to read:

California Greenhouse Gas Waiver Request | Regulations for Emissions from Vehicles and Engines | US EPA
https://www.epa.gov/sites/production/files/2016-10/documents/ghgwaiverexecutivesummary.pdf

 

[kenliles]

"Apple's micro-grid is reportedly capable of handling about 75 percent of Campus 2 power requirements during work hours, supplemented by Bloom Energy-provided fuel cells."

I know an even better solution coming on the market that would eliminate the fuel-cells and bring that to 100%. Just sayin'....

Still an extremely impressive implementation by Apple of solar panels on their new massive spaceship headquarters.
Latest 4K drone footage of Apple's 'spaceship' Campus 2 shows interior auditorium work, significant landscaping

 

[Menifeer]

There's a reason why they call it (options) "a suckers bet." Buy shares...

If you're considering buying shares, you might want to consider long-term, deep in-the-money call options.

The stock last closed at $213.34 as I write this. The January 2019 $100 call option is bid/ask $115.90/120. Assuming a trade could occur at about $117.50, that's a very slight premium over the share cost.

That option will go up/down in lock-step with the shares for the next year. If the stock really goes up (what we all hope for), the return on investment in the option will be much greater than on shares. If the stock tanks to zero, you'll only lose $117.50, not $213.34.

I agree that buying short-term options is a bit of a crap shoot. That's why I typically sell those.

 

[Thumper]

Great to see we have 3.5 giga miles of AP data and the graph is going straight up. If the market can avoid being in a post-factual mindset, it should dawn on more traders that this is just an enormous leap over potential competitors. We really should get some SP boost out of this. Also, best wishes to all for new year and thanks for all your posts and insights.

 

[MitchJi]

I'm 100% sure the Chevy Bolt will never be produced at significant volume and I have a hard time believing GM has a plan B...

Volume production of the Bolt will probably become GM's plan B. What's killing that is battery pack costs. LG will be able to reduce those eventually. Probably not enough to make the same margins that Tesla does, but probably enough to make a small profit.

Current GM pack costs are about $210 x 60 = $12,600

Cell costs will soon come down to $100 per kWh (vs ) $145 = $9,600, according to LG's roadmap, but that doesn't seem to be enough to make the Bolt profitable. But why can't they add a $10k pack to a $15k Sonic, sell it for $30k and make a profit?

Maybe they can, but want the government to think that they can't so that they'll continue to be able to get the ZEV Credits? Because if California figures out that they can make a profit they should eliminate the credits and just require them to sell EV's.

For comparison I believe that Tesla's 60 kWh packs will cost under $100 per kWh by some time in 2018. So less than $6k for a 60 kWh pack.

 

[vgrinshpun]

I'm not making any predictions because the Chumpster is a loose cannon, but you might want to read:

California Greenhouse Gas Waiver Request | Regulations for Emissions from Vehicles and Engines | US EPA
https://www.epa.gov/sites/production/files/2016-10/documents/ghgwaiverexecutivesummary.pdf

The waiver seem to be linked to California not following federal GHG emission control program, rather than implementing their own (ZEV) program. If this is true, the Emperor has no ability to prevent California to implement state program (ZEV) the way they see fit.

Am I reading this wrong?

 

[kenliles]

The waiver seem to be linked to California not following federal GHG emission control program, rather than implementing their own (ZEV) program. If this is true, the Emperor has no ability to prevent California to implement state program (ZEV) the way they see fit.

Am I reading this wrong?

That's my interpretation as well, but not with confidence, as the full context isn't included.

 

[RobStark]

The waiver seem to be linked to California not following federal GHG emission control program, rather than implementing their own (ZEV) program. If this is true, the Emperor has no ability to prevent California to implement state program (ZEV) the way they see fit.

Am I reading this wrong?

From what I understand the Big 3 wants Trump to "harmonize" ZEV and emission rules to eliminate the "patchwork" of rules that "raises the cost and eventually prices to consumers."

What the Feds grant the Feds can take away. This would definitely take 60 votes in the Senate and the help of Democratic Senators from the Midwest and South.

 

[larmor]

From what I understand the Big 3 wants Trump to "harmonize" ZEV and emission rules to eliminate the "patchwork" of rules that "raises the cost and eventually prices to consumers."

What the Feds grant the Feds can take away. This would definitely take 60 votes in the Senate and the help of Democratic Senators from the Midwest and South.

But arent states rights more of factor in the upcoming political climate, and less federal involvement (sorry for political post).

 

[vgrinshpun]

From what I understand the Big 3 wants Trump to "harmonize" ZEV and emission rules to eliminate the "patchwork" of rules that "raises the cost and eventually prices to consumers."

What the Feds grant the Feds can take away. This would definitely take 60 votes in the Senate and the help of Democratic Senators from the Midwest and South.

But going back to my point, the documents linked by @brian45011 indicate that California is the ONLY state that can have it's waiver considered. So if one assumes that this waiver affects not just federal GHG program rules, but California ZEV program as well, how is it possible for other 10 states participating in Claifornia ZEV program to have it allowed by federal government? In another words these states are not allowed to have GHG waiver, but apparently free to follow California ZEV program as well.

The bottom line, unless I am missing something, is that documents linked by Brian45011 do not limit neither California nor 10 other states to have and enforce their ZEV program.

I am not a lawyer and do not have experience in writing contractual documents, but this is my conclusion from skimming the subject documents. I would appreciate if professionals can point out what specifically am I missing?

 

[RobStark]

But arent states rights more of factor in the upcoming political climate, and less federal involvement (sorry for political post).

The upcoming political climate is Populist not Conservative.

Besides most politicians and voters are hypocrites when it suits them.

Liberals are going to argue for States Rights for California but not for Michigan to block the sale of Teslas.

And vice versa. Republicans will be all to happy to have Trump crush dissent on the West Coast and Northeast and to have "judicial activism" from the Supreme Court if there is a right wing majority.

 

[RobStark]

I am not a lawyer and do not have experience in writing contractual documents, but this is my conclusion from skimming the subject documents. I would appreciate if professionals can point out what specifically am I missing?

The Federal Government can rewrite the law that gives California an exemption and the legal ability to write its own laws regarding vehicle emissions or whatever else. And give no alternative to the CARB states.

 

[MitchJi]

Honda patents show technology that could give you X-ray vision

A pair of patent applications from Honda appear to show technology that will bring us one step closer to augmented-reality driving. The patents involve head-up displays (HUDs) and technology that can show people and vehicles that would otherwise be obscured. It'd be like being Superman behind the wheel.

IMO HUD's for the M3 are s great idea.


The first of the patents is for pedestrian detection. Many vehicles have a version of pedestrian detection that will alert a driver of a possible collision and automatically brake. This system from Honda would go a step further. Rather than just intervening when someone steps in front of the car, the proposed system would be able to detect multiple pedestrians and display their locations on an augmented reality HUD. It would also be able to locate pedestrians that are out of the driver's field of view, whether obscured by blind spots or something else. With this system, drivers would have information that would allow them to actively avoid a situation before the car has to intervene.

The one thing that I'm not confident about for Tesla's technology is detection of people and animals.


The second patent adds vehicle-to-vehicle communications for keeping track of cars in traffic. In the patent, Honda explains how the system would work with a line of three cars. Provided the cars were connected with a V2V system, the lead car would communicate with the middle car to calculate the distance between them. Then, the middle car would relay that information to the last car, which would display an icon representing the lead vehicle with its position and status on the augmented reality HUD. This would allow the driver to effectively see through the middle car to know where the lead car is and what it's doing. The system would also be able to keep track of when the lead car starts braking, giving the driver advance notice and more time to react to a sudden slowdown or stop.

Here, Tesla with their radar technology is miles ahead of the rest of the industry!

 

[Papafox]

The 200 day moving average vs. Q4 delivery numbers and Q4 ER

Tesla has recently pushed through both the 50 dma and 100 dma. With the 200 day moving average standing at less than 215, not much more than $1 above TSLA's current price, we could see the 200 dma beached tomorrow. Here's a brief comparison of why the 200 dma should fall this quarter, when it didn't in Q3, and the implications are:

Working against crossing above the 200 day moving average:
* History: TSLA didn't make it over the 200 dma following 3Q, and the stock fell quickly following both the 3Q delivery numbers and 3Q ER.
* History: Shorts have fiercely defended the 200 dma in the past. Don't be surprised if they mount a defense on Tuesday and Wednesday.Here is a graphic of the capping activity that took place on the first trading day after Q3 delivery numbers were released.



Working in favor of crossing above the 200 day moving average this quarter:
* TSLA is on an uptrend this quarter. It was in a downtrend last quarter
* Q3 offered two reasons for worry in the near future: the election and the SCTY merger vote on Nov 17. Consequently, many traders hoped to take their Q3 delivery and ER profits and run. Catalysts ahead this time look mostly positive
* Following the Nov 17 SCTY merger vote, the power of the shorts diminished. Capping activity is more likely to fail than to succeed now.
* There's evidence in recent weeks of institutional investors starting to buy in again. This evidence is the higher-volume slow but steady rises in stock price TSLA has shown recently
* Fidelity offered more than a million shares to short in the days immediate following the 3Q delivery numbers. Not so many shares are likely to be made available this time.
* Goldman issued a really negative note a few days after the Q3 delivery numbers. History is not likely to repeat itself here
* TSLA is only about $1 below the 200 dma a week prior to Q4 delivery numbers. TSLA was more than $10 below the 200 dma on the Friday before delivery numbers were released last quarter

Implications:
Expect a fight by shorts to stay below the 200 dma, but with the current uptrend (including some institutional buying), there's an excellent chance the 200 dma will fall this week. if Q4 delivery numbers are good (25,000 or higher), then Tesla will have delivered a 1-2 punch which should send the SP higher. Since the 200 dma has historically been fiercely defended by the shorts, when that number is exceeded you are getting to a point where shorts are more likely to start covering. In the event of a 1-2-3 punch by Tesla (adding a January 4 event at gigafactory- not yet confirmed), then a short squeeze becomes more likely. If Q4 ER is good (with very positive word of Model 3 still on time and good numbers expected in 2017), then Tesla has effectively delivered a 1-2-3-4 punch. Good delivery numbers will imply a good Q4 and a powerful no.4 punch. So, there's much riding on the Q4 numbers. If they're good, TSLA could be on its way considerably higher. I wouldn't want to be standing on the sidelines at the moment if I were a long.

 

[geneclean55]

Working in favor of crossing above the 200 day moving average this quarter:
* TSLA is on an uptrend this quarter. It was in a downtrend last quarter
* Q3 offered two reasons for worry in the near future: the election and the SCTY merger vote on Nov 17. Consequently, many traders hoped to take their Q3 delivery and ER profits and run. Catalysts ahead this time look mostly positive
* Following the Nov 17 SCTY merger vote, the power of the shorts diminished. Capping activity is more likely to fail than to succeed now.
* There's evidence in recent weeks of institutional investors starting to buy in again. This evidence is the higher-volume slow but steady rises in stock price TSLA has shown recently
* Fidelity offered more than a million shares to short in the days immediate following the 3Q delivery numbers. Not so many shares are likely to be made available this time.
* Goldman issued a really negative note a few days after the Q3 delivery numbers. History is not likely to repeat itself here
* TSLA is only about $1 below the 200 dma a week prior to Q4 delivery numbers. TSLA was more than $10 below the 200 dma on the Friday before delivery numbers were released last quarter

Its also worth noting that the high TLSA volume in the past week occurred during very low overall market volume. SPY traded half as many shares last week compared to the previous, while TSLA actually traded more.