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

[traxila]

I’m not sure Shanghai producing a few thousand more units a month than expected is particularly market moving news with the market cap over $1 Trillion. The current market cap assumes Tesla will be making 5 million+ vehicles annually at very high profit margins within a few years.

I don't see how any single news item over the past eight weeks could justify the stock moves we have had. In aggregate perhaps....

The stock was looking for a reason, any reason to go higher. China news would have done the job just fine.

But Elon took care of that, and I am OK with this. We will be there again and higher soon enough. Just IMO.

 

[kbM3]

I don't think there is much need for direct customer tax rebates for EVs anymore. Total demand is gonna outstrip total production for the next several years in EU, US and China anyway. Waste of money. Spend those hundreds of billions on charging stations, solar etc. When production maybe catches up to production in 26-27 absolutly no one will want to buy an ICE anyway.

Raised taxes on oil would be much more useful. Cause while that might not mean there are more EVs to switch to people would drive their ICE cars less.

EV subsidies are definitely NOT a waste of money when they end up with Tesla. I can’t think of a better place for that money to go. That extra demand will cause Tesla’s U.S. cash flow to increase by nearly the amount of the subsidy.

 

[Opus BC fan]

Up,
Down,
or Sideways

It is great to be on this noble ride with you all.
(especially if you use the ignore button occasionally)

Thanks.

 

[Hock1]

It DOES matter for short term forecasting of this quarters and next years results, but whether you think that matters with the stock at this level is probably the debate. I don‘t have anything against anyone that thinks it does make a big difference and should cause a big move up in the stock price, but I would only point out that if anyone thinks Shanghai producing an extra 5k in a month warrants a big jump in share price, then they therefore argue that the opposite should also be true: if Shanghai didnt meet production estimates in a particular month then it deserves a big drop in share price. Myself I don’t think that is true at all as I think the long term production goals being met are what matter, not short term movements.

On a positive note, this downdraft of the stock may turn out to be serendipitous for Tesla employees. It's that time of year that performance bonuses are allocated to the employees. Lower price means more shares. And, imagine a share split too. Elon DOES care about his employees. Just say'n.

 

[StarFoxisDown!]

I don't see how any single news item over the past eight weeks could justify the stock moves we have had. In aggregate perhaps....

The stock was looking for a reason, any reason to go higher. China news would have done the job just fine.

But Elon took care of that, and I am OK with this. We will be there again and higher soon enough. Just IMO.

Yeah…..couldn’t disagree more with you.

Q3 earnings more than justified the move. Stock should have easily been over 1,000 right after Q3 earnings. It was a joke that it was below 1,000 the day after.

I’m actually surprised any Tesla bull would say otherwise. If you believe in their growth trajectory for 2022, 1,200 was a very fair share price and you can use very clear numbers/metrics to back that up. The share price being back to 1,000 after those Oct number is the stock valuation back to being a joke.

Being up 20k over the previous quarter after just the first month which likely means Q4 being 40-50k more than Q3 will have profound effects on Q4 earnings

 

[SOULPEDL]

If you could buy more chairs today, and assuming you generally want to own more TSLA, would you do it now or place a buy at say 975 and hope for the best? Depends on if you think this is bottom in other words.

 

[Rarity]

Regarding the Horse Ranch LLC purchase, it appears to be most or all of the out-of-the-way peninsula across the Colorado River from Giga Austin that is right next to the water treatment plant. Snip attached.

 

[elasalle]

The Calls at 2K

If you could buy more chairs today, and assuming you generally want to own more TSLA, would you do it now or place a buy at say 975 and hope for the best? Depends on if you think this is bottom in other words.

have budget for 100 shares, sell a PUT or buy stock and sell Jan 23 1900+ Call (which will give you the discount)

Else ladder down.

 

[Gigapress]

I was being vague with the number, but my point being that Shanghai producing an extra 10-20k cars this quarter doesn’t move the needle on long term expectations, whether thats a 3 million or 5 million unit assumption in 2025.

It's not just about 10-20k extra cars, just as the Hertz order was not just about 100k extra demand.

The bump in expectations for Shanghai production ramp has implications for:

• How fast they get to 5 million (and beyond). CAGR matters.
• How much they've sandbagged the supposed ">450k" annual capacity of Shanghai when fully ramped
• How efficient and organized their manufacturing is
• How well they're executing in the chip shortage, and thus how good their engineering and supply chain agility is

 

[Curt Renz]

It's possible that some of this week's TSLA selling may have been by those who need cash for participation in the Rivian IPO.

 

[woodisgood]

If you could buy more chairs today, and assuming you generally want to own more TSLA, would you do it now or place a buy at say 975 and hope for the best? Depends on if you think this is bottom in other words.

Only strong guys know the answer to your query.

 

[traxila]

Yeah…..couldn’t disagree more with you.

Q3 earnings more than justified the move. Stock should have easily been over 1,000 right after Q3 earnings. It was a joke that it was below 1,000 the day after.

I’m actually surprised any Tesla bull would say otherwise. If you believe in their growth trajectory for 2022, 1,200 was a very fair share price and you can use very clear numbers/metrics to back that up. The share price being back to 1,000 after those Oct number is the stock valuation back to being a joke.

Being up 20k over the previous quarter after just the first month which likely means Q4 being 40-50k more than Q3 will have profound effects on Q4 earnings

"I don't see how any single news item over the past eight weeks could justify the stock moves we have had. In aggregate perhaps...."

Guess I should have emphasized the aggregate part more. Overall the trajectory for Tesla is spectacular which is why I am not sweating this action. But no single news item would have had this effect, outside of that one about Elon and the pocket sized fusion reactor he was playing with.

I was responding to theKiwi's belief that the China news would not have been sufficient to move the stock up this week. I think TSLA would have been knocking on 1300 without the latest poll as we were on a spectacular good news tear and that would have simply been the latest.

 

[dl003]

Darkpool sales of 16.8m today, is that correct?

Where do you see this?

 

[Lessmog]

Elon stopped the craziness, again. Great work, like always.

“Let’s get back to work, we have *sugar* to do and it’s a long way to get there!”

Nothing changed, just the price of the, everything is on track.

Q4 is going to be

I think I get what you're saying: Sofa, so good?

 

[MikeC]

I have no idea if this video is accurate but it looks like its saying there were over 11 million dark pool shares traded:

 

[Gigapress]

I wouldn't say 5+m is needed for this valuation. Simply how fast Tesla is growing combined with the earnings is pretty easy to come up with a valuation at or above the current share price. 125x next year's EPS is a common valuation number for a company in the growth pattern Tesla is in (and Tesla has hovered between 110 and 135 most of the year on consensus estimates... latter part of the year has been closer to 110). The street has 8.50 as the EPS consensus, which at a 125x, is 1062.50. If you are more bullish on earnings, which I'd say is reasonable given what we have seen in 2021... say the higher side of the street at 10.50... you have 1312.50. Between those numbers is on the bullish side, but possible to justify a valuation.

Yeah, 3 million would be sufficient even if growth drastically slowed from there.

30.5% gross margin last Q --> 35% margin at least
3 million units
ASP stays around $50k
Opex (which has stayed flat in 2021 despite almost doubling production) rises 30% to $8.6 billion

Auto biz operating profit: $44 Billion
Call taxes 20%.
EPS $32
Today's mkt cap: $1.1 T
P/E 32

Even just for this quarter, 300k deliveries at $55k ASP and 32% margin would be about $12 billion annualized earnings. P/E at today's share price is only 100.

 

[anthonyj]

I am down 3 Tesla Roasters today. I wrote 2 Roaster’s worth of put options to dummy bears. If they expire I make money. If I get assigned I make money. Poor bears!

 

[henchman24]

If Shanghai capacity is realistically >600k (seems it clearly is with October numbers)... I'd argue that is very significant to 2022 growth and projections. The bulls are in the 1.3ish range for 2022 now... which is basically Shanghai operating like Oct + Fremont + 100k from Berlin/Austin combined. The last part is absurdly low. Shanghai at 600+k puts 1.7m in 2022 into the possible category.

 

[SOULPEDL]

Only strong guys know the answer to your query.

Going to explore selling puts instead. So the deal is off.
But getting Elon's shares today at 1020.20 was sweet!

 

[henchman24]

Where do you see this?

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