Wow that's a ton of info! Can we expect similar of the Mach-e or others out there?
Related, does Monroe only doing EV teardowns?
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Tesla, TSLA & the Investment World: the Perpetual Investors' Roundtable
- Thread starter AudubonB
- Start date
Related, does Monroe only doing EV teardowns?
StealthP3D
Well-Known Member
I agree. VW is probably making money on EV's in the same manner that TSLA would be making money if they had introduced a 2022 compact with an entry level price under $30K. Each one would be profitable but the overall impact on the company would be for it to be less profitable than it would have been if they had stuck to their most profitable offerings.
VW is in the same position with EV's/ICE sales. Even if they can make EV's with positive margins, it's making the company less profitable overall. But they are being forced to do it and even the slow learners within the company can now read the writing on the wall. The question still remains, can VW, as a huge multi-national corporation, get through the period of maximum pain as they wind down their ICE operations? Because they can't just flip a switch and shut it down, it costs a lot of money to stop production and lay off all the people with ICE expertise while continuing to support legacy products while simultaneously bringing a bunch of new ones to market. The costs are staggering, even if not immediately apparent to an outsider.
StealthP3D
Well-Known Member
It would be nice if it were so simple to use science and math to prove such a thing.
There is a statistically significant correlation, but this would be expected even without manipulation (you have two moving targets that are tied to one another through options). So, you will not easily prove manipulation this way without getting so deep into statistics that the results will not be clear or absolute.
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You hint at this, but worth pointing out expressly.
VW is doing this because their leadership understands long term they must to stay competitive. Reasonably smart leadership seeing the writing on the wall (if a bit late). Decent chance of coming out the other end.
Stellantis seems to be shifting to EVs because regulations are forcing them to. Irrational leadership… likely into their grave.
I imagine that the contracts have pricing that references the spot price in some fashion. That's what we are seeing with all of the lithium deals. This is probably not an issue on a short-term basis. But if this elevated price persists over the coming months, I am sure that Tesla will have to pony up.
larmor
Active Member
Tesla could make huge profits if it only made the plaid model s. Coming soon are economies of scale on M3 and MY. I would think that a compact tesla EV would take at least 5 years to get to the economy of scale to be profitable.
Gigapress
Trying to be less wrong
Good point, so then it's not quite that straightforward to test.
I still maintain that the burden of proof belongs with those claiming max pain matters and I know this group has several people who know how to do that analysis.
Also, it would be much better to spend time properly doing the deep, rigorous analysis on the full dataset once instead of daily commenting and opining.
StealthP3D
Well-Known Member
Not really, because volume never disappears, it only increases and decreases. And by keeping a technical narrative intact, traders can be dissuaded from entering the market. If there is not high organic buying happening, high volume is not needed to control the price. It's all about narratives and writing the story how they want it to be understood.
It's not absolute control but it does affect how much people are willing to pay. It's making the stock less desirable to own by those who don't really know what they are buying/selling. Those who have taken the deep dive, and who understand Tesla, have already taken a position or are waiting for a technical entry point. No one can continue to buy ad infinitum simply because they believe it's undervalued.
StealthP3D
Well-Known Member
Obviously, Tesla would need to do the legwork, years of design and development to bring it to market, but I think it's pretty clear it could have positive gross margins as soon as it had ramped production to high enough volume to be profitable, less than a year of ramping. They have wisely resisted calls to do this because it would slow the mission down (as well as overall earnings). It wouldn't be in addition to Models 3 and Y, it would be in place of some of them. And margins would be much lower.
Even though I don't have a lot of faith in the way TSLA has been trading or will trade for the next 3 weeks, I do think it's being set up for the biggest blowout of earnings expectations in years.....maybe even ever.
The current expectation I see listed on yahoo finance is EPS of $2.24 Non GAAP.
This is of course, ridiculous considering Tesla will post at least a EPS of $2.84 even if they don't increase deliveries at all over Q4 since there was 340 million hit from Elon's options that absolutely will not be there in Q1 earnings. Tesla also had about 350 million in one time costs related to warranty recalls and expediting. Now maybe only half of that is there on Q1. So now we're up to EPS of 3.00. If Tesla does 25k more deliveries, than we're up to $3.25 EPS.
I guess the thought process as "why" expectations are so low is that Wall St things Berlin/Austin will have a drastic effect on earnings.
Oh how they don't actually listen to Zach
On the Q4 earnings call, Zach said that there were a mix of headwinds and tailwinds that could affect gross margins and that the expectations of ramping 2 new factories should be there. So it was impossible for him to say if gross margins would keep expanding in Q1, stay flat, or fall slightly. What Zach did say is that even given all those things, he expects operating margin to continue to expand.
The reason for this is that when Tesla starts delivering Berlin and Austin Y's, yes it will hit gross margins because of things like depreciation and amortization, cost of goods spread out of fewer cars from those factories, etc... though those margin hits could be offset by further price increases from last year taking effect, more S/X sale, and more sales overall higher sales from Shanghai.
But the reason operating margin will continue to expand is that Tesla is already taking the hit from operating those factories, paying the employees in those factories, utilities, etc....So those costs already hit Tesla in Q4. When Tesla starts actually making deliveries from both factories, it's going to increase operating margin because now they're actually getting revenue from those factories to cover those operating costs.
So......gross margin could be held down while Berlin/Austin ramp, operating margin will continue to expand. Wall St is not getting this.
James who has been a pretty accurate person with his estimates is projecting Non GAAP EPS of $3.25 on 325k deliveries. I think James may be a bit high on his gross margins but a bit low on his deliveries (I still think 330k baseline with 340k still possible).
In terms of a beat, this would be Tesla's largest beat $ wise and close to largest percentage beat as well. Yes I expect Wall St to do what they normally do and raises estimates but from the data I've collected, they usually only "rig" that to the tune of 10-15% adjustment. So maybe they raise it to $2.40-2.45. Would still be the largest beat $ wise in Tesla history.
The current expectation I see listed on yahoo finance is EPS of $2.24 Non GAAP.
This is of course, ridiculous considering Tesla will post at least a EPS of $2.84 even if they don't increase deliveries at all over Q4 since there was 340 million hit from Elon's options that absolutely will not be there in Q1 earnings. Tesla also had about 350 million in one time costs related to warranty recalls and expediting. Now maybe only half of that is there on Q1. So now we're up to EPS of 3.00. If Tesla does 25k more deliveries, than we're up to $3.25 EPS.
I guess the thought process as "why" expectations are so low is that Wall St things Berlin/Austin will have a drastic effect on earnings.
Oh how they don't actually listen to Zach
On the Q4 earnings call, Zach said that there were a mix of headwinds and tailwinds that could affect gross margins and that the expectations of ramping 2 new factories should be there. So it was impossible for him to say if gross margins would keep expanding in Q1, stay flat, or fall slightly. What Zach did say is that even given all those things, he expects operating margin to continue to expand.The reason for this is that when Tesla starts delivering Berlin and Austin Y's, yes it will hit gross margins because of things like depreciation and amortization, cost of goods spread out of fewer cars from those factories, etc... though those margin hits could be offset by further price increases from last year taking effect, more S/X sale, and more sales overall higher sales from Shanghai.
But the reason operating margin will continue to expand is that Tesla is already taking the hit from operating those factories, paying the employees in those factories, utilities, etc....So those costs already hit Tesla in Q4. When Tesla starts actually making deliveries from both factories, it's going to increase operating margin because now they're actually getting revenue from those factories to cover those operating costs.
So......gross margin could be held down while Berlin/Austin ramp, operating margin will continue to expand. Wall St is not getting this.
James who has been a pretty accurate person with his estimates is projecting Non GAAP EPS of $3.25 on 325k deliveries. I think James may be a bit high on his gross margins but a bit low on his deliveries (I still think 330k baseline with 340k still possible).
In terms of a beat, this would be Tesla's largest beat $ wise and close to largest percentage beat as well. Yes I expect Wall St to do what they normally do and raises estimates but from the data I've collected, they usually only "rig" that to the tune of 10-15% adjustment. So maybe they raise it to $2.40-2.45. Would still be the largest beat $ wise in Tesla history.
Hmmm, wonder why he thinks that?
Keep the bearish posts coming! Broke through the 200EMA and touched 860.
Nickel, FSD, SEC, Berlin water.
Sprinkle a little demand on that for the cat.
Competition is coming!! Lyriq is coming in hot at the end of the month and will put a huge hit in Tesla Model Y sales.
Sorry.. can’t say that with a straight face.
Considering the archaic crap the Russians seemed to have sent their troops with, it’s likely Ukraines communications are much more sophisticated and secure than Russias at this point.
BrownOuttaSpec
Active Member
I think @JimS feeds the max pain chat data to @Papafox for his daily posts.
HUGE Thanks to both of those people to supply us with great data on a regular basis! If you're crazy you could skim all the posts and piece together a long graph of the Max pain vs stock price from all the posts over in that thread. Or maybe @JimS has a bigger/longer duration graph he can share with us:Similar threads
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