Tesla, TSLA & the Investment World: the Perpetual Investors' Roundtable

[woodisgood]

What if it's all a game of chicken. If investors know the plan is that "they" will short it hard (based on media signals or smoke rings), then they might wait for the better entry price. But now the shorts see the Tesla momentum, upgrades, and also don't want to get caught flat footed with some FSD release right when they're floating it down hard, fearing they could get another Gamestop type response. So the safest place is $650, waiting for someone to flinch. (Who knows...)

I think sometimes we like to believe retail volume matters, but the truth is it usually doesn’t (except for GME/AMC situations). Retail matters by buying and holding strongly, so that WHEN there is significant buying volume, the availability of shares is low and the price increases rapidly.

The buying volume that makes the share price increase can only come from funds and banks, and large shorts covering (also funds and banks). This is what @StarFoxisDown! is saying - there’s no buying interest from the whales, and that seems fishy.

Possibilities:
1) Advance knowledge that discounts will be available soon, i.e. an anticipated or planned market crash.

2) TSLA rise over the next few years is so obvious the whales are accumulating calls/LEAPs instead of shares. In that case the price will not rise until those are delta-hedged.

3) FF interests paying whales more to stay out of the stock than the stock would return. They have billions to burn on the Tesla problem, and every day of delay gets them billions more. Why would this not be one of many avenues to spend on?

 

[Curt Renz]

Barron's - 20 minutes ago: Tesla Blew Away Earnings. Shares Fell. What Gives?

Excerpts:

...For starters, investors can blame China. That’s the obvious problem. Tesla stock opened higher Tuesday, but closed down 2% on the day as Chinese stock fears bled into various sectors. The Nasdaq Golden Dragon China Index dropped 5.2%, dragging down Tesla peers. Shares of Chinese electric-vehicle producers NIO (NIO), XPeng (XPEV) and Li Auto (LI) dropped 8.8%, 14.8%, and 13.9%, respectively...

...Jonas rates shares Buy and has a $900 price target for the stock. Credit Suisse analyst Dan Levy isn’t as bullish. He rates share Hold and has an $800 price target.

Still, Levy praised profit margins too, but raised another issue, besides China, which might be weighing on shares: production delays. The Cybertruck won’t likely be in buyers’ driveways until early 2022, a little later than expected. That’s a legacy of the global semiconductor shortage that is roiling global automotive production. TE Connectivity (TEL) CEO Terrence Curtain told Barron’s recently that the chip shortage cut global auto production by about 5 million units in the first half of 2021.

Tesla isn’t immune to that issue. “We were able to substitute alternative chips and then write the [software] in a matter of weeks,” explained Musk on the conference call. “It’s not just a matter of swapping out a chip. You also have to rewrite the software. So it was an incredibly intense effort of finding new chips, writing new firmware, integrating with the vehicle, and testing in order to maintain production.”

With the shortage lingering, it seems investors want something else, besides earnings and Wall Street endorsements, to send shares out of their recent range and back above $700...

 

[lnb2g]

Was being capped below 650 while the other growth EV stocks were sharply rising, then when the algos decided to sell off the sector, $TSLA was allowed to fall too - Max Pain is currently $647.50 for this Friday (likely will drop a bit before then to $645), so MM's keeping it under control

Edit: ad graph, updated

View attachment 689151

Max pain is a joke. I see alot of people mentioned it here as a proxy. If you don’t believe me, monitor it for 5-6 wks and see hoe accurate or inaccurate it is. It is something to look at but you shouldn’t use it as a proxy. Btw, im a technical trader happens to be holding a bag for tsla and really frustrated about the price action here. 648 is pivot for now

 

[capster]

My take from the lack of parts problem is that for Tesla it's a problem to get enough to double production. For others it's to get enough to make as many as previous years.

Even if the shortages means Tesla manufacturing can only go up 80%, instead of 100%, all the others would miss more and the only negative, financially and SP wise, would be a couple of months delay to get where we are going. It's not gonna help others catch up. From a competitive angle I think this shortage is actually more good than bad for Tesla.

Actually if you really think about it. If Tesla lose 20% potential manufacturing next year. That's 200,000 electric cars that doesn't get made. If all the other manufacturers lose even only 5% of their manufacturing that's 4 million ICE cars that doesn't get made. That's actually good for the environment.

I don't really see much of a downside for Tesla either way.

Totally agree. It’s ironic that the legacy OEM’s could in theory solve the chip shortage themselves: Tesla’s much lower chip count suggests there is bloat on the legacy side and there might enough low hanging fruit to remove to ease the shortage.

In practice, this might mean inculcating a culture in which efficiency and frugality with resources are central goals—in which 3 feet of tubing are used for cooling instead of 9 feet, vehicles are designed to be more streamlined than bricks, unnecessary components are removed when they add little value and are prone to break,…. Oh wait, never mind.

 

[SOULPEDL]

I've concluded the buying starts on Monday as they wait for the week of earnings and have more data. Then they adjust accordingly.
(I'm just making this s**t up. As good a theory as any though, and now I only have to wait a few more days, 3 to be exact).

 

[InDaClub]

I think sometimes we like to believe retail volume matters, but the truth is it usually doesn’t (except for GME/AMC situations). Retail matters by buying and holding strongly, so that WHEN there is significant buying volume, the availability of shares is low and the price increases rapidly.

The buying volume that makes the share price increase can only come from funds and banks, and large shorts covering (also funds and banks). This is what @StarFoxisDown! is saying - there’s no buying interest from the whales, and that seems fishy.

Possibilities:
1) Advance knowledge that discounts will be available soon, i.e. an anticipated or planned market crash.

2) TSLA rise over the next few years is so obvious the whales are accumulating calls/LEAPs instead of shares. In that case the price will not rise until those are delta-hedged.

3) FF interests paying whales more to stay out of the stock than the stock would return. They have billions to burn on the Tesla problem, and every day of delay gets them billions more. Why would this not be one of many avenues to spend on?

I expect a stock split would upset their plans.

 

[StarFoxisDown!]

I've concluded the buying starts on Monday as they wait for the week of earnings and have more data. Then they adjust accordingly.
(I'm just making this s**t up. As good a theory as any though, and now I only have to wait a few more days, 3 to be exact).

We got 2 different potential catalysts next week - FSD V9.1 coming out over the weekend (we'll see if there's some big progress) and potentially getting China July numbers at the end of next week (though might be beginning of the following week).

Edit: Also we should get the date of the shareholders meeting sometime soon I've had to believe

 

[Tslynk67]

The Hang Seng dropped like 10% in 4 days. Chinese stocks are recovering today. It's not just EV stocks, but BABA, DIDI, JD... All are up at least 5%.

US stocks are mostly flat waiting for the FOMC meeting.

This puts paid a bit to the theory that all CN stocks are being mashed by the CCP, if that were the case, why would they rebound like that?

Agreed with regards to the FOMC - recently it has had the tendency to have caused a bit of a sell-off after each report & Powell comments, I guess because almost anything they say will be taken as a negative

 

[woodisgood]

I expect a stock split would upset their plans.

When the time is right...I imagine there’s plenty that could be done to “shock the stock.”

Edit to say that last time’s strategy of splitting the stock may not have quite the same effect. That strategy forced an accounting of real shares and if it had the effect we believe it did on certain entities, they are unlikely to be as vulnerable the second time around.

This time, a different strategy may be required if the problem is less about shorting and more about colluded anti-buying (which is just one theory). It’s far-fetched, but TSLA shares being some kind of route to SpaceX investment might be the ticket. Or an umbrella X corp.

As shareholders we tend to get impatient but I doubt Tesla considers the current share price problematic after it returned 10x in a short time or that shenanigans have reached a critical threshold. If we’re still sitting at this level EOY then it may be time.

 

[SOULPEDL]

I think sometimes we like to believe retail volume matters, but the truth is it usually doesn’t (except for GME/AMC situations). Retail matters by buying and holding strongly, so that WHEN there is significant buying volume, the availability of shares is low and the price increases rapidly.

The buying volume that makes the share price increase can only come from funds and banks, and large shorts covering (also funds and banks). This is what @StarFoxisDown! is saying - there’s no buying interest from the whales, and that seems fishy.

Possibilities:
1) Advance knowledge that discounts will be available soon, i.e. an anticipated or planned market crash.

2) TSLA rise over the next few years is so obvious the whales are accumulating calls/LEAPs instead of shares. In that case the price will not rise until those are delta-hedged.

3) FF interests paying whales more to stay out of the stock than the stock would return. They have billions to burn on the Tesla problem, and every day of delay gets them billions more. Why would this not be one of many avenues to spend on?

4) They're still double checking the 10K and about to make a move any day.

 

[TheTalkingMule]

But what do they want? These guys can't openly collude, which makes the game theory problems even greater. Why wouldn't one or more of them jump the gun?

Who's to say no one jumped the gun? There was plenty of volume yesterday, the SP just happened to go down. And since most daily volume is just massive self-trading, we have no idea how many shares were actually acquired yesterday with the intention of holding them and profiting off their future appreciation. I assume MM's have the option to naked short as much TSLA as they feel is appropriate to "balance price action", so they can just eat buy orders for the whole day if they like. This morning's volume was decent, but now it's dried up. Why can't a MM have naked eaten tons and tons of buy orders with the intention of cooling excitement for two days and then closing the position at a modest loss next week?

I know NOTHING about the inner workings of market making other than what I read here, but it feels as simple as MM's eat buy orders when it's in their interest to do so rather than forcing buyers to find a legitimate seller. Lucky for us that's a MASSIVE amount of money dangling out there so they only take it so far, and we can approximate how far they've taken it. Then when demand breaks a tipping point, we get something akin to a period of isostatic uplift. Which is then an unstoppable force until it's energy is exhausted.

I vote for Monday! (* I get no vote)

 

[ReddyLeaf]

Some top-quality manipulation ongoing today, capping below 650 while the sector sharply rises, then letting it fall when the rest drop...

One MM wants 645 and another wants 650. I’m hoping they agree to disagree at 647.50.

 

[Zero CO2]

Tesla has several more advantages over the legacy OEM’s in the competition to get chips in addition.

1. The chip makers probably see that Tesla’s future is brighter than the legacies and will want to nourish that relationship.

2. Tesla has lower volume and fewer chips per car, "the best part is no part," so they will be much easier to fulfill completely than the legacies.

3. Tesla may be able to outbid the legacies on price even taking into account the lower volume of Tesla’s orders. Tesla cars have a high ASP. Tesla’s margins are good. Tesla also has the pricing power, due to high demand, to pass along some if not all of the price increases.

These points will apply, more so even, to suppliers of things besides chips looking to their own futures.

point #3 is spot on in the current environment ... silicon vendors are charging expedite fees so chips are going to the highest bidder right now ...

 

[Singuy]

This puts paid a bit to the theory that all CN stocks are being mashed by the CCP, if that were the case, why would they rebound like that?

Agreed with regards to the FOMC - recently it has had the tendency to have caused a bit of a sell-off after each report & Powell comments, I guess because almost anything they say will be taken as a negative

Not sure if I would say CCP mashed anything. Fear is what mashed CN stocks as people think CCP will be after other Chinese based US traded companies next which probably has no basis, just speculation.

 

[Singuy]

Tesla has several more advantages over the legacy OEM’s in the competition to get chips in addition.

1. The chip makers probably see that Tesla’s future is brighter than the legacies and will want to nourish that relationship.

2. Tesla has lower volume and fewer chips per car, "the best part is no part," so they will be much easier to fulfill completely than the legacies.

3. Tesla may be able to outbid the legacies on price even taking into account the lower volume of Tesla’s orders. Tesla cars have a high ASP. Tesla’s margins are good. Tesla also has the pricing power, due to high demand, to pass along some if not all of the price increases.

These points will apply, more so even, to suppliers of things besides chips looking to their own futures.

I wish a question for Elon was asked about the firmware they are developing for other microcontrollers. Would their 12+ firmware development only allow Tesla to meet capacity or expand capacity if chip shortage spills over to next year? This question right now has a default answer of "meet capacity". If Elon was asked this question and he said it will allow Tesla to expand capacity to meet growth guidance then SP wouldn't be sitting in the mud right now.

 

[Big Time]

No interest rate change @ FOMC

 

[SOULPEDL]

I vote for Monday! (* I get no vote)

I already got dibs on Monday. Thank you for your vote

 

[Remster32]

New Morgan Stanley note today on Tesla's Adjusted EBITDA.

 

[vwman111]

Max pain is a joke. I see alot of people mentioned it here as a proxy. If you don’t believe me, monitor it for 5-6 wks and see hoe accurate or inaccurate it is. It is something to look at but you shouldn’t use it as a proxy. Btw, im a technical trader happens to be holding a bag for tsla and really frustrated about the price action here. 648 is pivot for now

So your technical pivot is the same as Max Pain? Does that make your technical analysis a joke as well?

 

[Tslynk67]

New Morgan Stanley note today on Tesla's Adjusted EBITDA.
View attachment 689184View attachment 689185

That's their third $TSLA note in a couple of days, no? I guess they're looking for the price to go up a bit...