Short-Term TSLA Price Movements - 2016

[FredTMC]

Am I the only one who doesn't think a cap raise is needed this soon?

Yes, Musk tweeted that they'd need to rethink production plans, but with model 3 production start being over 18 months away, where's all that money going to go? The next 6 months is going to be used to refine the design anyway, so more money isn't going to bring up more production sooner (mythical man-month thinking).

To minimize dilution and still expand production plans, they need to show FCF by Q2, squeezing the shorts, and then issue the raise, not during this stagnant period of no news (are we in quiet period yet?).

I hope you're right. Best for TSLA but I doubt it. I think race is on to build out for M3. They'll Start buying equipment/tooling for production sooner than originally planned. Just a guess

 

[MitchJi]

I said I had an outstanding and publicly verifiable track record of calling this stock (I do) and that I think I can seriously help navigate an un-nerving time for the stock (apparently I could). The guy went nuts and called me a fraud and trolled TMC with mocking and financially misleading straw-man misquotes of my writings all the while being flat wrong!

How about sparing a thought for those couple of long term TMC members that came on here to declare they had seen enough doom and were bailing at the bottom of a predictable (and predicted) $100 V-shaped chart spanning a matter of weeks.

I'm very grateful for your analysis. I'm not sure I would have purchased our LEAPS without it (currently up 36k).

OTOH I'm equally grateful to jesselivenomore, who was arguing with you. You were saying that $200-$207 was a great entry point, but Jesse and Fluxcap were urging caution. Due mostly to jesse's warnings I waited to pull the trigger until the SP dropped to $170 (.6) and $161 (.4). My only regret is that I didn't wait until Jesse and Fluxcap bought in at $148.

OTOH both of you treated each other very poorly. Both of you were to blame!

Edit Addition:
Thank you Jesse and Julian for your help!

Please help us all, and yourselves as well and bury the hatchet. One of my mentors said "that if you lose money you lose nothing, if you lose health you lose something, but if you lose your character you lose everything." IMO this is an opportunity for both of you to improve your characters and to help the community.

How about this: what if Tesla in a quarterly report and call during this year came out with a "would-be" balance sheet showing how they would have been clearly free cash flow positive at a certain point in time (for example in Q2 or Q3) but at the same time an actual balance sheet where they're not FCF positive due to having revised their schedule and goals for Model 3 as a result of unexpectedly high demand and reservation count (resulting in increased investment for production capability and R&D, or "cash burn" as seems to be a preferred term by many)?

My $0.02 on the thread contents is that this type of post, and the ensuing replies, are fantasies with zero benefit. Also the posts about the status of the my tesla server. I don't see any possible way for these types of posts to help anyone to make profitable trades.

 

[Fallenone]

Does anyone know if Tesla is actually selling any of the Tesla Energy products at all? All I have seen so far is Pilot Projects and stuff. Not sure if they actually started generating revenues on this or not.

TE is generating revenue as early as 2015 Q4. However the amount is insignificant. Profit is negligible.

 

[Johan]

I'm very grateful for your analysis. I'm not sure I would have purchased our LEAPS without it (currently up 36k).

OTOH I'm equally grateful to jesselivenomore, who was arguing with you. You were saying that $200-$207 was a great entry point, but Jesse and Fluxcap were urging caution. Due mostly to jesse's warnings I waited to pull the trigger until the SP dropped to $170 (.6) and $161 (.4). My only regret is that I didn't wait until Jesse and Fluxcap bought in at $148.

OTOH both of you treated each other very poorly. Both of you were to blame!


My $0.02 on the thread contents is that this type of post, and the ensuing replies, are fantasies with zero benefit. Also the posts about the status of the my tesla server. I don't see any possible way for these types of posts to help anyone to make profitable trades.

Great. Thanks for your opinions about Julian and jesse that go a long way to increase the value of this thread. Thanks too for your personal trading history, very helpful indeed.

Edit: in reading and considering the replies that post got I realize it would be a bad idea to present something like that. Either they are FCF positive or they're not. (Well there's GAAP or non-GAAP but that's nothing new).

 

[aznt1217]

Does anyone know if Tesla is actually selling any of the Tesla Energy products at all? All I have seen so far is Pilot Projects and stuff. Not sure if they actually started generating revenues on this or not.

They have been selling them. US Market isn't first there's plenty of articles on Powerwall residential installations in the UK and Australia so far. In addition, Powerpaks have been sold as well. Just a google search away

 

[geneclean55]

It is certainly a pivot and battleground. If we can gain traction above this we are headed to the next resistance - somewhere in the neighborhood of 255.9ish. If not the next level of support is 243ish. We will know soon after the munch hour, but my inclination is that we will gain traction near or above this pivot. TSLA short term moves are like the crazy aunt that forgot to take her medication.

Looks like it pushed through 251.8

 

[DesertCO]

Looks like it pushed through 251.8

I always seem to notice an attack on TSLA between 13:10-14:00EST. Could be my imagination, but it seems whenever resistance lines are crossed (I pegged today's at 251.9) a relentless selloff happens. But if we can hold above that number we are looking good.

 

[surfside]

i'm definitely not an experienced short term trader or chartist, but having watched TSLA for a long time (including the 2013 huge increase in the stock price), these days feel somewhat similar to 2013 when the stock made a number of step changes (upwards) followed by consolidation.

my take on the current short term price movements is that we are currently consolidating within this range ($240-$255). i personally would not be surprised to see the stock gain momentum heading towards the Q1 earnings call as shorts begin to run out of ammunition and buyers look to announcements / updated guidance from the Q1 earnings call. will be VERY interesting to see where shorts stood as of yesterday when it is reported after the market closes on tuesday, april 26th.

surfside

 

[Fallenone]

Oh god no. We don't really have to debate it since it is not like Elon will do what we say on a message board, but I really, really hope they don't take that route. That plays *directly* into the Bear's arguments, that TM is a cash-burning loser that depends on handouts. And creating yet another synthetic metric does the same-- that smacks of goalpost moving. Instead of using GAAP or lightly modified "non-GAAP" that they have been using for years, they create new metrics in 2 consecutive quarters? Heck, I would think something was fishy and I am captain of the fan club.

Plus, by sticking with the apparent plan of polishing up Q2 they will prove way more effectively the same point, that on an operational basis they are profitable. Then they can pivot instantly or in another quarter to say "well, we need to reinvest so we drive these great profits even higher in the future". That is language the market understands and Elon and Wheeler are in the mood to care about this right now.

There is a selfish aspect too, since (as Julian also said) there is a second very tradeable setup coming. I am aware Elon may not care about my trading plans, but here our interests are aligned I think.

Elon/Wheeler's options:

A) Push bad news into Q1 and and good news into Q2. Model S (refreshed!), Model X and even TE are all accretive right now. Spending is largely all optional in this quarter and they can just slow down and push things into Q3 or Q4. Push the line, even extra shifts if needed. Announce great deliveries July 3. Announce great earnings, FCF Mid Aug. Stock is propelled to new highs and they announce a cap raise of a few Billion to finance M3 expansion.
B) Try to do a Cap raise now on the relative strength of the M3 announcement while it is fresh on people's minds. Raise some money now and immediately start spending watering down the positive financials in Q2 and Q3 which will still be pretty good. Maybe even great if they just cannot spend fast enough, propelling the stock to new highs AFTER they did a cap raise at ~250.

B is an OK plan but why go that route when you have A? I wouldn't be shocked if they go that route. A bird in the hand and all that.

I'm not preferring either of these options, but for option A, there is the risk that the stock price would fall to near 200 levels if waited this long and it would take extra time and money to propel the stock to new high and trigger a massive short squeeze. Unless they have enough good news in their hands to play in order to maintain the price. After all, TSLA is a momo stock and rarely acts in a narrow sideway.

 

[austinEV]

My $0.02 on the thread contents is that this type of post, and the ensuing replies, are fantasies with zero benefit. Also the posts about the status of the my tesla server. I don't see any possible way for these types of posts to help anyone to make profitable trades.

What?? Johann presents a well thought out theory on management direction in the next few quarters and that is off topic? I disagreed with it and wrote why (one of the responses you don't care for either) but that doesn't mean it doesn't belong here.

 

[MitchJi]

TE is generating revenue as early as 2015 Q4. However the amount is insignificant. Profit is negligible.

Profit was small in Q4 due to the time and Cap-ex required to build an automated production line in Nevada and to move production from Fremont. They did not complete that until near the end of Q4, but still managed to make a small profit in Q4.

Both Elon and JB said that the margin is over 15%, while obviously trying to hide their pack costs. I believe that their margin is at least 20%. Why else would they be so vague about their TE margins, when at the same time they gave much more precise estimates of the MS and MX margins?

 

[Fallenone]

Profit was small in Q4 due to the time and Cap-ex required to build an automated production line in Nevada and to move production from Fremont. They did not complete that until near the end of Q4, but still managed to make a small profit in Q4.

Both Elon and JB said that the margin is over 15%, while obviously trying to hide their pack costs. I believe that their margin is at least 20%. Why else would they be so vague about their TE margins, when at the same time they gave much more precise estimates of the MS and MX margins?

Yes I should have used "was" when talking about the revenue size and profit for 2015 Q4.

But the near 0% gross margin for TE in 2015 Q4 should not be due to cap-ex. The cost from cap-ex should be evenly distributed to a number of products they make on the equipment. For example, robots making the S is depreciated evenly over 250k Model S they make. So the cost from cap-ex for TE in Q4 would be the same for a number of years from now.

 

[Discoducky]

Profit was small in Q4 due to the time and Cap-ex required to build an automated production line in Nevada and to move production from Fremont. They did not complete that until near the end of Q4, but still managed to make a small profit in Q4.

Both Elon and JB said that the margin is over 15%, while obviously trying to hide their pack costs. I believe that their margin is at least 20%. Why else would they be so vague about their TE margins, when at the same time they gave much more precise estimates of the MS and MX margins?

Going to be very interested to hear the update in the next earnings

 

[Ulmo]

$TSLA SP seems like a blimp in the wind

 

[MitchJi]

What?? Johann presents a well thought out theory on management direction in the next few quarters and that is off topic? I disagreed with it and wrote why (one of the responses you don't care for either) but that doesn't mean it doesn't belong here.

Because it's a well thought out fantasy. How could your opinions right or wrong about this issue possibly either impact short term SP or help anyone to trade?

We also don't need the running ticker tape type of posts (e.g. SP is up $1.19) unless there is a substantial movement. Perfect example:

$TSLA SP seems like a blimp in the wind

We've reached the point where it's important to try to reduce the nonessential posts on this thread. It's like going on a diet. To do that we're all going to have to try to have some self restraint. I didn't mind Johan's post or the replies but IMO they were unnecessary. Examples of the type of posts we need to eliminate if we want to reduce the number of posts on this thread.

 

[austinEV]

Because it's a well thought out fantasy. How could your opinions right or wrong about this issue possibly either impact short term SP or help anyone to trade?

Because he might be right! (for the record Johan has apparently retracted this) Elon really *might* give the direction to do an immediate cap raise and lean more heavily on synthetic metrics. That is not a fantastic idea at all. Don't confuse your distaste for an idea with something being off topic. I agree we have a lot of off topic, and META posts (posts about posts, or this one, posts about posts about....) but this isn't one of them. You are just trying to censor an idea you didn't like.

Sigh. I cannot engage in this without becoming the thing I hate. I am white-knighting and beating a dead horse and...

 

[geneclean55]

Stock just instantly got smacked down a few dollars against the nice upward rise. Wonder why..

 

[Mike K]

Stock just instantly got smacked down a few dollars against the nice upward rise. Wonder why..

I happened to be watching my stream when it happened. It went from $214 and some change to $250 basically instantaneously and then bounced around between $250.xx and $251.xx for about 30 seconds before bumping back up to $252.xx and now it seems to be slowly recovering.

I'm no expert but this simply appears to be somebody dumping a ton of stock all at once, does it not?

 

[doctoxics]

The action today can be explained in part by the upgrades to Models S and X. Another, perhaps more important factor, may be that the market is beginning to grasp the significance of the Model 3 reservations. Long before the Model 3 reveal, many of us projected a million reservations by the start of production next year. That projection seems more probable with the 325,000 reservations we already have. A million reservations converted to orders is more than 40 billion in revenues and that revenue stream is not far off (begins next year). Tesla's revenues last year were 4 billion. The 40 billion plus in revenues is the gorilla in the room that may be creeping into the stock price. If so, expect the impact to slowly push up the stock price for months to come, regardless of Q1 earnings.

 

[geneclean55]

I happened to be watching my stream when it happened. It went from $214 and some change to $250 basically instantaneously and then bounced around between $250.xx and $251.xx for about 30 seconds before bumping back up to $252.xx and now it seems to be slowly recovering.

I'm no expert but this simply appears to be somebody dumping a ton of stock all at once, does it not?

Yep. Looks that way. No sudden news that i am aware of.