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

[MC3OZ]

Thus, if Tesla is not going to pay a dividend nor build up a multi-hundred billion cash balance in this decade, then they must have something else planned.

Elon said they are not running out of ways to spend money...

The recent update on 4680 battery production provides a clue... if the 4680 production process is working well the next summit to be conquered is the Lithium clay extraction process...

Assuming both are working well, and the Roadrunner lines are a stable well proven production method, Tesla can rapidly ramp up cell production for both vehicles and storage, to the point where cells are no longer a constraint...

Assuming they can source the engineering talent, more production lines, and models are possible...

At Austin I fully expect 2 or more factories of around the same size... with Austin eventually producing 6-7 different types of vehicles.
The only thing I am not sure about is, the availability of skilled workers in Austin...

I always predict Tesla will pay dividends in 5 years time, in 5 years time I'll still be predicting that,.. but I might finally be right.

 

[Gigapress]

NHTSA has already taken a more aggressive stance against Tesla, and frankly, I think this is simply to be expected the closer to FSD full rollout. I'm sure the FSD team has been preparing for much more scrutiny for months and years. They'll be ready to fight. I'm not saying this is a nothing burger, but I'm sure Tesla is prepared.

Other than talking tough, initiating some investigations and requesting some data, what have they actually done to restrict progress so far?

 

[CLK350]

If SpaceX splits out Starlink, it will be in order for it to IPO so they can raise money. They don‘t need Tesla backing, Starlink will have plenty of interest from outsiders. It is the sort of business Wall Street laps up.

The point is for Starlink to get funding BEFORE it goes public ... so instead of using SpaceX funds (which SpaceX needs for rockets etc) it can use Tesla's extra cash.

 

[RobDickinson]

The point is for Starlink to get funding BEFORE it goes public ... so instead of using SpaceX funds (which SpaceX needs for rockets etc) it can use Tesla's extra cash.

Wait, what?

 

[jw934]

Good interview of Adam Jonas on CNBC. He doesn't get everything right, but he has definitely come full circle. Once Morgan Stanley starts upping their 6M TSLA production estimate for 2030, their PT will start to take off (currently $900).

More specifically, he clarified his new $900 price target is based on his estimate of 5.8 million car to be produced in 2030 with an incremental $150-$200 for each additional million cars that he can justify for 2030, "on what he can learn from the quarter" .

Seems to me the reason he gave that formula so publicly was so that he can cover off why he quickly lifted the price target after the Q3 earnings call, once his clients are first notified.

 

[Ogre]

The point is for Starlink to get funding BEFORE it goes public ... so instead of using SpaceX funds (which SpaceX needs for rockets etc) it can use Tesla's extra cash.

I don’t get this at all. The whole point of the IPO is to raise cash. Starlink is fully owned by SpaceX right now. They get Starlink listed as a separate company and have an IPO where they *sell* shares of Starlink to the public. Depending on how they structure it, going public potentially raises money for Starlink and SpaceX both. It is essentially a vehicle which SpaceX can use to benefit from public markets without the core business being exposed to public markets.

 

[Sancho]

Good interview of Adam Jonas on CNBC. He doesn't get everything right, but he has definitely come full circle. Once Morgan Stanley starts upping their 6M TSLA production estimate for 2030, their PT will start to take off (currently $900).

Get ready for revved up Tesla profits, Morgan Stanley's Adam Jonas predicts

Morgan Stanley's Adam Jonas looks ahead to Tesla's earnings. With CNBC's Melissa Lee and the Fast Money traders, Guy Adami, Tim Seymour, Dan Nathan and Karen Finerman.

www.cnbc.com

Adam Jonas can’t come “full circle” because he’s always occupied 360 degrees on Tesla. Among the biggest bulls and bears at the same time.

AJ wants to be regarded as the smartest guy in the room. So much so, that he’d prefer to say something that sounds smart over what he knows to be smart.

That said, I’ll take him over just about every other analyst. At least AJ gets Elon’s and Tesla’s potential.

 

[Sancho]

Really, we are debating whether Tesla will have too much cash than it knows what to do with?

Elon can use capital to fuel disruption of industry after industry.

Tesla is neither an automotive nor a tech company. It’s a transformation company, and for that, there’s no such thing as too much cash.

 

[Gigapress]

Really, we are debating whether Tesla will have too much cash than it knows what to do with?

Elon can use capital to fuel disruption of industry after industry.

Tesla is neither an automotive nor a tech company. It’s a transformation company, and for that, there’s no such thing as too much cash.

Yes, because as Elon has said, you can't just go to the store and buy good engineers. And because for like 6 straight quarters Tesla has been spending less that their income, so for the time being there actually has been too much cash.

 

[Skipdd]

I have not seen this posted here yet. Suggestion that there could be a supply chain issue with aluminum because of use of magnesium and an issue in processing in China. Does this impact Tesla? Guessing if it does affect them, they already have a Plan B. Jalopnik article.

https://jalopnik.com/the-car-shortage-is-about-to-get-a-whole-lot-worse-1847892481

 

[SPadival]

She has blocked me and a large bunch of other people, which indicates she has subscribed to the TSLAQ mass block list.

This is war.

Confirmed. This is literally a who's who's list of $TSLAQ

Tesla will survive this one too. Elon has always succeeded when faced with adversity and he has never backed away from a fight. Heck, he's been selling cars in states that have banned him from selling cars, poked fun at the SEC and set up a factory in the middle of Big oil/Big Auto's home state/country respectively. Any adverse regulatory action by the NHTSA is a buying opportunity (<- Not-a-financial advice).

The biggest problem here is the misconception of what an ADAS system is capable of. NTSHA's beef with Tesla has always been the naming of their products sounding too close to fully self driving so an introduction video will solve all of that. Yes it's in the manual that no one ever reads.

The naming thing is merely a wedge/slippery slope to see if Elon would give in to "public" pressure (aka propaganda by the shorts/MSM).. if he had, they would have moved on to bigger things. To his credit, Elon did not budge.. instead he hung up on the NTSB chief lol.

 

[pz1975]

More specifically, he clarified his new $900 price target is based on his estimate of 5.8 million car to be produced in 2030 with an incremental $150-$200 for each additional million cars that he can justify for 2030, "on what he can learn from the quarter" .

Seems to me the reason he gave that formula so publicly was so that he can cover off why he quickly lifted the price target after the Q3 earnings call, once his clients are first notified.

So if he comes to believe that Tesla can produce and deliver 20 million cars in 2030 (as they have guided), Jonas will release a $3,000 price target ((20-6)x$150 + 900)!? Haha - I'd love to see that.

 

[StealthP3D]

IIRC there was a clause in the Tesla Shanghai agreement that all profits had to be kept in China; the simple way around it was to spend the C Yuan for Chinese batteries that are exported to the US.

That was an idea I saw TSLAQ types pushing pretty hard but I've never seen a good source for that claim. If you have one, please post it!

 

[Singuy]

Confirmed. This is literally a who's who's list of $TSLAQ

Tesla will survive this one too. Elon has always succeeded when faced with adversity and he has never backed away from a fight. Heck, he's been selling cars in states that have banned him from selling cars, poked fun at the SEC and set up a factory in the middle of Big oil/Big Auto's home state/country respectively. Any adverse regulatory action by the NHTSA is a buying opportunity (<- Not-a-financial advice).

Her financial dealings with Lidar and having supporters from Tesla short sellers is like a lawyer's wet dream. Lets get this lawsuit started already!

 

[mblakele]

Apparently Tesla is trying to stay ahead of supply chain issues wherever possible. While trying to replace the Michelins on my Model 3, I found that Tesla seems to be buying tire makers' entire production of Tesla-spec tires. Local independent tire shops claimed they couldn't order the tire at all, while a tirerack order went to Tesla Nevada rather than directly to Michelin, and quoted estimated availability at the end of this year.

Meanwhile Tesla Service gave me an estimate within 24 hours, for an appointment in about two weeks — so at least they seem to have access to stock.

Bullish.

 

[Prunesquallor]

Or they could make paperclips.

Uhhh. Nasty AI connotations (Bostrom).

 

[Skipdd]

Apparently Tesla is trying to stay ahead of supply chain issues wherever possible. While trying to replace the Michelins on my Model 3, I found that Tesla seems to be buying tire makers' entire production of Tesla-spec tires. Local independent tire shops claimed they couldn't order the tire at all, while a tirerack order went to Tesla Nevada rather than directly to Michelin, and quoted estimated availability at the end of this year.

Meanwhile Tesla Service gave me an estimate within 24 hours, for an appointment in about two weeks — so at least they seem to have access to stock.

Bullish.

Interesting. I was curious so I just looked at what is showing on the aftermarket “Shop” section for Tesla online. I looked at S and 3 tires and most were out of stock. I just bought a new set of winter tires for my S - Michelin Ice-x Snow, and the company said there were only 24 in the Mid-Atlantic up into the Northeast. He was looking at national distributors since he is not a chain (but they do a brisk business - lots of Teslas). Not sure what to make of it..

 

[StealthP3D]

Considering the tsunami of FCF headed our way, do you understand Elon's statement at the shareholder meeting that they don't expect to pay dividends any time soon?

All I can think of is that Elon is intimating that a massive, monumental increase in CapEx is coming soon, beyond that which we already know about that fed into your $48 B estimate. I can only think of one way to profitably spend that much in '22-'24 and beyond: Directing most automotive production away from consumer sales & leasing in favor of building the Tesla Network robotaxi fleet. At a unit production cost of let's say $24,000 each, that would fund production of about 2 million robotaxis while keeping cash and debt roughly constant.

Thoughts?

When the production process of 4680's is perfected, Tesla will have the ability to execute on the energy storage side of their business in grand scale by replicating the process on all populous continents. We are talking numbers of batteries that are difficult for traditional energy industry people to even comprehend (including how cost-effective large installations will be). It's going to be greatly disruptive to the energy sector. But it will take massive spending on production facilities and likely taking joint multi-billion dollar investment ventures or outright ownership of multiple mining and refining operations. It may even include large investments in the profitable mining of spent batteries for raw materials. Redwood materials is going to need investment capital to scaIe. This is all part of the new energy boom which I expect to happen before 2030 which will greatly accelerate Tesla's primary mission, to accelerate humanities transition to sustainable energies.

Returning money to shareholders before that time would be ridiculously short-sighted and would limit the rate of growth and the value of TSLA shares in more ways than one. Do you want a 0.5% quarterly dividend (2% annualized) and 10% annual growth of the share price or do you want to watch the value of your shares increase 30-70% annualized? Massive growth requires deploying large amounts of capital effectively and sending checks to shareholders is not how you do that. I predict Tesla will not pay regular cash dividends until around 2033 or later.

 

[Ogre]

She has blocked me and a large bunch of other people, which indicates she has subscribed to the TSLAQ mass block list.

This is war.

I’m pretty sure if she is a government official, this is considered censorship. Didn’t Trump get prevented from blocking people?

(Not trying to dig into politics of Trumpism here, just the law)

 

[Boomer19]

Elon said they are not running out of ways to spend money...

The recent update on 4680 battery production provides a clue... if the 4680 production process is working well the next summit to be conquered is the Lithium clay extraction process...

Assuming both are working well, and the Roadrunner lines are a stable well proven production method, Tesla can rapidly ramp up cell production for both vehicles and storage, to the point where cells are no longer a constraint...

Assuming they can source the engineering talent, more production lines, and models are possible...

At Austin I fully expect 2 or more factories of around the same size... with Austin eventually producing 6-7 different types of vehicles.
The only thing I am not sure about is, the availability of skilled workers in Austin...

I always predict Tesla will pay dividends in 5 years time, in 5 years time I'll still be predicting that,.. but I might finally be right.

5 years, longer, it doesn’t matter. the point is you are correct, now is not the time.

the man said it himself. there’s bigger fish to fry. that takes time. the ambitions they have, the human capital needed…sometimes takes longer than anyone would expect.

this horse hasn’t hit its prime yet. let it keep racing. later it can go to stud and everyone can collect their dividends.