Short-Term TSLA Price Movements - 2016

[ev-enthusiast]

Shorts are toast. When Countrywide Mortgage was headed towards bankruptcy, Anthony Mozillo (CEO) was selling off his shares at the maximum rate he could without having to file an SEC disclosure and alert the media.

If the people closest to the top are buying as much as possible, how can shorts seriously believe the company is going under soon?

As you might know JB Straubel did not buy as many shares as possible during the past. Please check the past couple documents. Usually he sold his shares right away. Keeping his shares this time is a small and nice sign, no doubt. Would be important to know his reasons behind his actions of selling/keeping his shares.

And please go figure what happened to SolarCity SP after EM purchased a big chunk of shares. SP doubled to about $50, now it is back to about $20.

 

[CaptainKirk]

As you might know JB Straubel did not buy as many shares as possible during the past. Please check the past couple documents. Usually he sold his shares right away. Keeping his shares this time is a small and nice sign, no doubt. Would be important to know his reasons behind his actions of selling/keeping his shares.

My initial reaction is to keep in mind though JB has a modest salary as CTO. Understandably, him selling his shares in the past provided financial security and stability. Now that he has the money, he can afford the taxes on the exercise of his options and that is an important sign. Gonna go dig up documents to see the extent of his past sales though just to be sure.

 

[Cattledog]

"In our first main markets, Australia and Germany, we have seen Tesla Energy inbound sales leads quickly exceeding vehicle sales, more than doubling our total potential Tesla customer inquiries. We are excited about the potential growth in vehicle sales this new energy customer base could also represent."

I can't think of too many other auto manufacturers that have ever indicated tangential products might yield additional business. Cool!

 

[Intl Professor]

Sorry to divert thread back to speculation about M3. Would any of you know what BMW 3 series market is? Would that not be a conservative estimate of the number of reservations? We correctly point out the Model S and X are competitive only with other luxury vehicles when others low ball the company. Eventually M3 may become a truly more mass-market car, but isn't the real competition in real world something better initially than the current BMW 3 series?

 

[FredLambert]

Sorry to divert thread back to speculation about M3. Would any of you know what BMW 3 series market is? Would that not be a conservative estimate of the number of reservations? We correctly point out the Model S and X are competitive only with other luxury vehicles when others low ball the company. Eventually M3 may become a truly more mass-market car, but isn't the real competition in real world something better initially than the current BMW 3 series?

 

[pGo]

Model s covers 25% or so market share. Giving 30% to M3 gives 150k.

 

[dha]

Model s covers 25% or so market share. Giving 30% to M3 gives 150k.

I don't think Model 3 will be limited to stealing market share from the European entry-luxury market. At the very least, I think Model 3 is likely to pull a considerable number of Prius drivers (market size of an additional ~150K units / year in U.S.), and a significant number of "stretch" buyers who would normally be shopping for something like a Corolla (360K units / year). You can count me in that second camp--I'll be trading in my third Honda Civic for a Model 3.

If Model 3 represents a true paradigm shift, all our predictions will go out the window. There were 110 million smartphones sold in 2007. But the success of the iPhone was not limited to some % of this figure. Truly transformative products transform the market. There were hundreds of millions of latent customers waiting to enter the smartphone market once a truly transformative product arrived on the scene.

It's the same fallacy encapsulated by the repeated bear mantras of "niche market" or "toys for the rich." If Model 3 lives up to its promise, you will see people who never would have considered a "luxury car" buying Teslas in droves.

 

[vgrinshpun]

Model s covers 25% or so market share. Giving 30% to M3 gives 150k.

This is probably a conservative estimate. Given what we know about Model S - that it took significant quantity of sales from lower priced vehicles, I think that Fremont Plant Model 3 capacity can be easily absorbed by US market alone. This is probably why Elon during the visit to Hong Kong was talking about Chinese factory in 2018...

On a different note JB exercised 107,916 options without selling any stock. This transaction almost doubled his stake from 134,902 to 242,818.

 

[woof]

(99 TeslaPoints to the first who....well, either you know why or you'll have to wait and find out.....)

Now go banish your own post to the politics thread. Sheesh, mild-mannered yet doesn't follow the rules very well.

 

[vgrinshpun]

Perusing data on Tesla IR page, there are few SC 13G/A forms posted listing TSLA ownership at the end of Q4. To summarize data included below, just between four listed companies, there was increase in institutional ownership in Q4 by 6.5M shares, as well as increase by 2M in shares shorted. It will be interesting to see the data after Feb 15 when all of the Q4 forms are due. It looks like the spring is being tightened. Something got to give. The question is when?

 

[Papafox]

Model s covers 25% or so market share. Giving 30% to M3 gives 150k.

Remember, too, this is U.S. sales numbers. Perhaps someone can dig up worldwide sales numbers for BMW 3 series and similar cars.

 

[Papafox]

Regarding the exercising of options, if one pays the taxes from a source other than by accepting fewer shares, such a decision is definitely bullish.

I'm still wrangling with stock options where the taxes are paid for by shares, though.

Here's a question for people well-versed in taxes, though. If J.B. exercised his 100,000 shares (assuming single-digit strike price) at $300 a share instead of the current $150 a share, wouldn't he still pay about 50% of the value of the shares in taxes? If so, he should end up with about 50,000 shares at either price point if he used shares to pay for the taxes. One advantage of doing the option at a higher price, though, would be a higher basis for the stock. Perhaps someone well-versed in taxes could comment.

 

[rocketenergy]

Perhaps this has been covered previously. Trying to understand this filing.

Tesla Motors - Amended Statement of Beneficial Ownership

Elon has the ability to purchase 8.8 million shares within the next 18 days?

I'm sure the strike price on them are all over the place. But this is interesting. Perhaps the recent price drop over past few months was in anticipation of major "dilution" by him exercising these options. By him making the purchases when the stock was $200 and $150, it essentially confirmed that fear.

I know he's in it for the long haul. But those shares coming into existence + a corresponding decrease is stock value lessens the actual market cap reduction, correct?

Perhaps that explains some of this. Or I'm wrong? Help me out.

 

[Gerardf]

()	Amount beneficially owned: 37,193,974 shares which includes (i) options to purchase 8,822,632 shares of Common Stock that are exercisable within 60 days of December 31, 2015 and (ii) 28,371,342 shares of Common Stock held by the Elon Musk Revocable Trust dated July 22, 2003.

(b)	Percent of class: 26.5% (percentage ownership is calculated based on 131,424,866 shares of common stock outstanding as of December 31, 2015 and assumes that the shares of common stock underlying the stock options are deemed outstanding pursuant to SEC Rule 13d-3(d)(1)(i)).

As I understand these 8.8M shares already exist.

I find the other bold part interesting. Does it mean Elon MUST exercise these within 60 days or CAN do that (and do that later this year).

 

[Johan]

Elon acquiring more shares like this results in some (not major) dilution to the rest of the shareholders, yes. But seeing as he keeps his shares it can also be very positive:
1) Very bullish sign that the CEO wants to borrow money to pay taxes to keep shares rather than sell shares to cover taxes or even sell all shares to take profit
2) Elon's ownership stake increasing (both in absolute and relative terms) puts pressure on shorts (Elon is tge ultimate strong long - remember "my money was first in and will be last out").

So all in all, I'll take this dilution to my shares with a smile and I don't believe it has had much, if any, effect on the price performance since November.

 

[Causalien]

()	Amount beneficially owned: 37,193,974 shares which includes (i) options to purchase 8,822,632 shares of Common Stock that are exercisable within 60 days of December 31, 2015 and (ii) 28,371,342 shares of Common Stock held by the Elon Musk Revocable Trust dated July 22, 2003.

(b)	Percent of class: 26.5% (percentage ownership is calculated based on 131,424,866 shares of common stock outstanding as of December 31, 2015 and assumes that the shares of common stock underlying the stock options are deemed outstanding pursuant to SEC Rule 13d-3(d)(1)(i)).

As I understand these 8.8M shares already exist.

I find the other bold part interesting. Does it mean Elon MUST exercise these within 60 days or CAN do that (and do that later this year).

Either exercise or let it expire worthless. He can get a loan to exercise, but it seems like a huge number now, so he will probably just exercise and sell. Or he can exercise and sell parts of it, then with the money, buy stocks and pay taxes.



The shares either comes from the treausry, or gets created during exercise, the cfo know best and can advise elon on the best course of action. I listened to him,a bit on the cc. I think he is a good candidate for coo.

 

[rocketenergy]

"Elon Musk selling shares of Tesla" is a headline the bears are just waiting for. I just wonder if some of the action recently has been in anticipation of what you just stated.

But after some quick, brainless math, I see 131 million outstanding shares multiplied by $151 comes to the current market cap that we all know. So seems like I was off.

But if he has to exercise those options within the next 18 days, or they disappear, they I anticipating him doing so. Otherwise he would be throwing money away. At the same time, exercising them and selling them would be detrimental. Perhaps that is why the recent selling has occurred. Perhaps they know he cannot afford to pay the taxes on 8 million shares.

Its late and maybe my brain isn't working. I feel like there may be some connection here.

 

[mmd]

"Elon Musk selling shares of Tesla" is a headline the bears are just waiting for. I just wonder if some of the action recently has been in anticipation of what you just stated.

But after some quick, brainless math, I see 131 million outstanding shares multiplied by $151 comes to the current market cap that we all know. So seems like I was off.

But if he has to exercise those options within the next 18 days, or they disappear, they I anticipating him doing so. Otherwise he would be throwing money away. At the same time, exercising them and selling them would be detrimental. Perhaps that is why the recent selling has occurred. Perhaps they know he cannot afford to pay the taxes on 8 million shares.

Its late and maybe my brain isn't working. I feel like there may be some connection here.

This issue was discussed here when he exercised a big lot 2 weeks ago. At that time, brian(something) mentioned 7.6m shares to be exercised before end of Dec 2016. Now, looks like there are more options(!) and the timeline is just 18 days

Perhaps Elon can take short term loans against previously exercised options (shares) to cover the taxes, and then slowly sell some shares over this year.

 

[rocketenergy]

I looked at a similar filing from almost a year ago and it had similar wording and mentioned 7.2 million shares exercisable within 60 days of dec 31 2014. And I don't see anything showing that those happened (in fact I see evidence clearly stating otherwise). So perhaps there is something we are missing. And probably why I'm not in charge of anyone's money besides my own lol.

Guess I should mention...don't take anything I take seriously lol. I'm more looking for guidance rather than attempting to guide anyone here.

 

[everman]

Quick breathless off topic news update!

As of today, Friday Feb 12[SUP]th[/SUP], Sig X VIN 42x is officially out of production and through quality control. It has now entered the Tesla transportation system. A lot depends on the weather now. Should be here soon!