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

[Singuy]

That is one thing a company with windfall of cash has to be careful about. Like what they are doing now, ramping to the secondary plant without a finished template of the first. They are currently have 10K employee and will continue to grow. And 20bln to place wild bets. Anyway that's as much cash as legacy company without the ICE baggage. Their chance may be better than the legacy due to less baggage.

When Tesla had 10k employees, they

-delivered 31,655 cars that year
-Had a total of 95 service centers around the world

vs 600-700 trucks made and 4 service centers

That's a lot of thumb twiddling

 

[mltv]

CEO of GM's autonomous vehicle branch Cruise is leaving the company

Cruise's President and CTO Kyle Vogt will take over as interim CEO, the company said.

www.cnbc.com

Turnovers are coming pretty frequently doesn't it

https://twitter.com/x/status/1471597264489435137

I have a feeling more are coming

 

[Tes La Ferrari]

https://twitter.com/x/status/1471597264489435137

I have a feeling more are coming

Isn't being the "VP, of Global Innovation at GM" like being the "VP, of Integrity at NKLA" ?

 

[OrthoSurg]

You could sell a Jan 930, get $75 and have a pretty nice entry at 855.. which is I think a good target overall. Or, keep the 75$ and play another round come Jan 2022

I think your bigger risk is in the next 5 trading days. Tomorrow for sure. I gotta say, when ppl are willing to pay ~+8.5% for an ATM PUT a month out from expiration, somethings gonna give hard and pretty soon. Selling into the close is well, I’ll have to look that one up in the book.

Excellent strategy too. A $855 entry point is something anyone would have dreamed of 2 months ago.

 

[mars_or_bust]

in the german forum, they claim that the authorities are waiting for Tesla for some documents, so it's not the authorities' fault that no final permit is handed out yet.
I am not sure if it's true, it's what I read there.

Of course there are some more documents. There are ALWAYS some more documents - this is after all the EU - even worse it is Germany.
This video is very apt:

 

[henchman24]

Your loss actually widens as you get into volume production (because you have more employees, more contracts, more overhead, more customer service, more operating expenses). Looking back at Tesla's financials, first Tesla has never made only 1m in revenue in a quarter. Their lowest revenue was 30M. They have also never had a net loss of 1.23B in a quarter even with volume production. When Tesla was making 30M dollars in revenue, their max net loss was around 100M.

So I don't know wtf Rivian is doing besides swimming in cash and not caring one lick about expense.

They are accelerating some of their expenses, but I think you are purely looking at the number and size of the losses, not the margin. I expect the numbers on the loss to grow and grow significantly, but they will start narrowing the margins. Right now it is basically a complete loss. As they get production that will narrow and the financials will look better than now (they really can't look much worse).

Financials beyond cash flow and cash in the bank are not really critical to Rivian right now. The critical thing for them is getting volume production. They need to get to 20k run rates within 6 months and 50-75k within 12. Once they are there, then the financials beyond cash will start to matter. That is why the few hundred short of the awfully low 1200 is a bad sign as it means they are already falling behind their 55k by the end of 2023... which I think is already too slow for them to survive. IMO they'll need 30k in 22 and 70k in 23 to survive on the cash they have now. That said, there is a solid chance they could live off secondary offerings to survive a slow ramp.

 

[Ogre]

Excellent strategy too. A $855 entry point is something anyone would have dreamed of 2 months ago.

And cringed at the thought of 3 months ago.

 

[Thekiwi]

https://twitter.com/x/status/1471597264489435137

I have a feeling more are coming

While everyone has been (rightly) mocking Bara for her ridiculous claims about GM being the ”leader” in EVs - I find it amazing she has managed to avoid any calls for her to be fired due to the Nikola fiasco, which I thought would have been front and center of investor concerns.

 

[StealthP3D]

Your loss actually widens as you get into volume production (because you have more employees, more contracts, more overhead, more customer service, more operating expenses). Looking back at Tesla's financials, first Tesla has never made only 1m in revenue in a quarter. Their lowest revenue was 30M. They have also never had a net loss of 1.23B in a quarter even with volume production. When Tesla was making 30M dollars in revenue, their max net loss was around 100M.

So I don't know wtf Rivian is doing besides swimming in cash and not caring one lick about expense.

I think things will improve with Rivian over the next several quarters - they are likely booking a lot of expenses for AMZN vans and RT1 production now so they can come on strong in the middle to second half of next year. If so, that's the kind of manufactured improvement that doesn't really speak to their ability to succeed in the long run. Long-term success will come down to management's ability to make it happen. Not an easy job but there is plenty of room for a company like Rivian if they can demonstrate "the right stuff". Without having studied Tesla financials from 2013 era, isn't that how they showed a profit briefly at a very early stage? By front-loading some expenses before and during initial production ramps?

In any case, Rivan earnings were a solid beat...

errr... well, a beat-down, anyway.

 

[SageBrush]

Being a good fund manager means you have market beating results. Not in any given year, but over the long haul.

Ark Invest has a great track record. A couple of years ago when my ARK had doubled and everyone was hot to jump in, I cautioned that, in the long run, a fund like this can't really expect over 15% average annual returns.

I thought about investing in ARK, but then I applied the same question to them that I apply to myself and asked 'how does ARK look without Tesla ?'

 

[UnknownSoldier]

RIVN seems bent on dragging us down too with them. Guess I was smart waiting until tomorrow to do some trading.

 

[StealthP3D]

I have a contact at Rivian. They’re unnecessarily paying for things like travel and lodging for employees that really don’t need to be traveling at all. They’re also hiring engineers not based on what’s best for the company but for ideological reasons pushed forward by the most vocal employees.

What kind of ideological reasons? Like, because their engineer friend is unemployed and needs to make a house payment?

 

[Right_Said_Fred]

Excellent strategy too. A $855 entry point is something anyone would have dreamed of 2 months ago.

Two months ago we closed at $843

But you are absolutely right: it’s an excellent strategy. You get 100 shares with $75 discount compared to buying them right now or get to keep the $7500 premium.

 

[Thekiwi]

I thought about investing in ARK, but then I applied the same question to them that I apply to myself and asked 'how does ARK look without Tesla ?'

Great question - I wish there was a tool to do it.

Comapring 3 & 5 year performance with TSLA excluded to even the S&P500 (SPY) would be interesting.

(Obviously the 1 year comparison is atrocious - even with TSLA included: ARKK down 24% vs SPY up 29%)

 

[StealthP3D]

I thought about investing in ARK, but then I applied the same question to them that I apply to myself and asked 'how does ARK look without Tesla ?'

I bought ARK funds for exactly that, their non-Tesla exposure to non-traditional brick and mortar businesses. The TSLA was just the bonus (or the "baggage" depending upon how you want to look at it).

 

[tivoboy]

Excellent strategy too. A $855 entry point is something anyone would have dreamed of 2 months ago.

Well ALMOST anyone.

 

[UnknownSoldier]

Well ALMOST anyone.

I was going to say, I don't think I've ever dreamed of another $855 entry point, my stake is fine the way it is and I was strapped in for my rocket ride to Mars.

 

[MikeC]

RIVN seems bent on dragging us down too with them. Guess I was smart waiting until tomorrow to do some trading.

So TSLA pulls RIVN stock price up, then RIVN pulls TSLA stock price down. Seems fair.

 

[Artful Dodger]

All I know, is I’m basically out of dry powder by now and not looking at the daily price movements, i. e. On Marketwatch, Fidelity, etc. until everyone here (ahem artful dodger, curt renz, Winfield100) all agree Elon has completed his last sale. Until then, I’m playing dead.

Label and file this experience under the topic: 'FOMO'.

The Lesson? "There will be more Opportunities".

We are riding the Lower-BB to fill the gap. That's how those hedgies roll, and you can bank on it.

Cheers!

 

[CorneliusXX]

Your loss actually widens as you get into volume production (because you have more employees, more contracts, more overhead, more customer service, more operating expenses). Looking back at Tesla's financials, first Tesla has never made only 1m in revenue in a quarter. Their lowest revenue was 30M. They have also never had a net loss of 1.23B in a quarter even with volume production. When Tesla was making 30M dollars in revenue, their max net loss was around 100M.

So I don't know wtf Rivian is doing besides swimming in cash and not caring one lick about expense.

Early years of Tesla's production can be seen as a series of increasingly large J curves with Model S production rolling into X then rolling into 3. Tesla made 1 quarter of profit because the S had reached "volume" production and the big spending on the X hadn't started yet.

Rivian is basically attempting to charge head first into a Model 3/Y ramp with the R1T and Amazon van without the backing of an equivalent S/X product to mitigate the losses.

If it works for Rivian they will be in a strong position - but there is a long way to go before they get to the upward slope of the J curve. I hope it works out for them but I'm certainly not going to be an investor until there is more clarity they are hitting their volumes.

like any vehicle startup - which inherently has high operating leverage - They just need to make more cars.