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

[StarFoxisDown!]

This is BAU for the financial press and analyst cabal. They keep estimates low on purpose during the quarter to provide better entry prices for the customers, then jack up those estimate in the last 3 days before earnings. Buy the rumor, sell the news. Rince, repeat. It's how they roll.

Yes, that's the dynamic that's been played time and time again. But.........and this is what I've been saying for most of 2021, we're now getting into a stage where P/E compression has been so extreme combined with Tesla's earnings growing to scale that forces the issue.

So the dynamic before was keep EPS estimates low for most of the quarter, raise the last week or so, and even when Tesla would beat, the go to was "Ok Tesla beat but it's still overvalued based on TTM P/E". They could even use the excuse of "Well the PEG is still way too high". What's changing in this dynamic is that Tesla beating or even meeting "raised" expectations has significant implication not earnings like 2 years away, but this years earnings.

So here's an interesting comparison. I'm tracking PEG's of all the mega cap stocks. Again closer PEG number is to 1 means fairly valued, the higher from 1 means more overvalued. You'd think TSLA would have the highest PEG number of the mega caps since it's widely considered more risky than say Apple or Amazon, etc..

Apple - 3.20
Amazon - 2.74
Google - .94
Netflix - 1.81
Microsoft 2.42
Nvidia - 3.22

Tesla - 2.39

So Tesa is the 3rd least overvalued stock of these comparison. But wait......the PEG is using "expected" future earnings. We know, Wall St analysts are grossly underestimating Tesla's future earnings. EPS of 10.48 for 2022 and 12.73.

In reality, Tesla is going to beat those EPS estimates by 75% for 2022 and 100% for 2023. If you take the full 5 years of EPS estimate distortion from low expectations, in reality, Tesla's PEG is under 1. Meaning it's actually the 2nd cheapest stock of the big cap stocks. So when analysts do their "last min EPS estimates", they're then forced to raise their 2022 and 2023 EPS estimates and their 5 year estimates. That will then drop TSLA's PEG lower.....even if the stock price goes up.

And just for fun comparison. GM's PEG is currently 1.62. Meaning Tesla is cheaper than GM if analysts used real EPS estimates for Tesla. I would compare Ford but all of Ford's metrics are completely thrown off by their Q4 earnings where 95% of their earnings was from their Rivian stake.

 

[Prunesquallor]

Tesla will pay Ukrainian employees for up to 3 months if conscripted to fight — CNBC

Tesla employees were also praised for helping SpaceX, the aerospace venture also led by Tesla CEO Elon Musk.

apple.news

Edit: Kolody article

An internal email obtained by CNBC outlined steps Tesla is taking to support Ukraine.

For instance, Tesla will keep Ukraine employees on payroll for at least three months if they're called back to the country to fight.

The email also praised Tesla employees for helping SpaceX, Elon Musk's aerospace company, set up Starlink satellite internet service in the country.

 

[capster]

Well, no, we can't. That's because we don't know the extent to which Market Makers have hedged their positions at any strike price, or at what level of loss they are willing to step in. It's further made difficult because we don't have realtime data for Open Interest (always at least 1 day stale), and we NEVER get final Open Interest data for the actual day of contract expiry (can't model w/o data).

Then, even if you could, MMs are only 1 of at least 6 different groups playing tug-of-war with the SP.

TL;dr. No we can't settle this debate, and the rules are written by the owners of this casino.

HODL.

Well, would not the extent to which we cannot do so covary with Max Pain’s speciousness as a predictive metric?

 

[ZeApelido]

I don't know if we are going to be able to rely on retail investors to pump the stock to ATH

 

[insaneoctane]

I wonder how GM is cutting costs in their manufacturing processes and designs? Do we have any updates from Mary? All I could find was this from Sept 2019.

• General Motors has been promising major increases in its electric-vehicle lineup, even though the company reportedly loses up to $9000 on every Bolt EV it sells.

Other than the Fiat 500e admissions of losses, I don't think anyone wants to share these numbers to it's shareholders. Diess came clean at one point, lost his post, and back again as I recall. Tough pill I'm sure.

GM CEO Mary Barra Says Company Aims to Sell 1 Million EVs a Year

Barra believes General Motors can expand beyond the Chevy Bolt to a full, big-selling EV lineup.

www.caranddriver.com

Yeah, I know the audience here has heard all this, but I don't see how any analyst could possibly expect a legacy company trying to grow their EV sales to be competitive with Tesla? With low vertical integration meaning they share their margins with many, 2 technologies to ramp/slow where both work against them (ICE slows and loses economies of scale, thus margins fall while EV ramps and has negative or terrible margins- with virtually no chance of approaching Tesla's economies of scale), slow adoption / resistance to innovative cost savings (mega castings vs how they've always done it), dealership model, where, again, they share margins, unionized workforce that is notoriously inefficient, lack of vision/dedication to long term pricing contacts...I mean this list goes on and on. Yup, Mary's leading . Let's invest in Ford or GM

 

[Featsbeyond50]

ARK's got some clean couches today. Sold 5 shares of Palantir. lol

 

[StarFoxisDown!]

$1,000 price increase for all 3/Y Trims.

Tesla also prioritizing orders with FSD by essentially giving anyone that wants a 3/Y early delivery in May.

That's one way to get FSD take rate higher

 

[JusRelax]

$1,000 price increase for all 3/Y Trims.

Tesla also prioritizing orders with FSD by essentially giving anyone that wants a 3/Y early delivery in May.

That's one way to get FSD take rate higher

Tesla also increasing Model 3/Y performance and Model Y LR prices in China by about 3%:

https://twitter.com/x/status/1501754403774255107

 

[slacker775]

$1,000 price increase for all 3/Y Trims.

Tesla also prioritizing orders with FSD by essentially giving anyone that wants a 3/Y early delivery in May.

That's one way to get FSD take rate higher

Do we have any non-anecdotal evidence for prioritizing FSD? Fwiw, I ordered my MYLR on Nov 1 and received my VIN this week with a small EDD window of Mar 25-28. I’ve seen many other folks with orders before me that are still a ways out. I did order with FSD and also in red so two potential kickers to get me closer to the front of the line. And alas it is a Fremont build.

 

[Artful Dodger]

Our own @DaveT lays down the smak on the SEC, and explains what comes next:

Free Elon Musk (Ep. 554) | Dave Lee on Investing

Cheers!

 

[Ohmster]

Solid. Just simply solid.

Tesla dominates January BEV sales in the United States with S3XY lineup all in Top 10

Tesla’s domination of the United States electric vehicle sector continues Tesla’s Model Y, Model 3, and Model S claimed the top three spots of January’s U.S. BEV registrations, with its top two models combining for well over 60 percent of the total electric vehicle sales during 2022’s first...

www.teslarati.com

 

[JustSaying]

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.

I saw the the BMW "competition" tonight at a Tennis tournament in Indian Wells CA, up close the front plastic kidneys looked like a Fly's eye under a microscope ("Help Me" came to mind)

 

[Gigapress]

Solid. Just simply solid.

Tesla dominates January BEV sales in the United States with S3XY lineup all in Top 10

Tesla’s domination of the United States electric vehicle sector continues Tesla’s Model Y, Model 3, and Model S claimed the top three spots of January’s U.S. BEV registrations, with its top two models combining for well over 60 percent of the total electric vehicle sales during 2022’s first...

www.teslarati.com

"The Model Y accounted for 36.8 percent of all BEV sales in the United States, while the Model 3 made up 27 percent. Tesla’s two mass-market vehicles combined for around 63.8 percent of the total electric vehicle sales in January"

 

[StarFoxisDown!]

Solid. Just simply solid.

Tesla dominates January BEV sales in the United States with S3XY lineup all in Top 10

Tesla’s domination of the United States electric vehicle sector continues Tesla’s Model Y, Model 3, and Model S claimed the top three spots of January’s U.S. BEV registrations, with its top two models combining for well over 60 percent of the total electric vehicle sales during 2022’s first...

www.teslarati.com

If anyone feels like trying to dig for October's number through this Experian method, we might be able to get a good idea of if Fremont is ahead of Oct in Q4.

The closest I could find is this article US: BEV Sales Almost Doubled In January-October 2021

Where it says it it's estimated that roughly 40,000 EV's were sold in total. If Tesla had the same market share in Oct as they did in Jan, it would mean Tesla sold 29,520 in Oct. In Jan, it's saying Tesla sold 37,162. So a roughly 19% increase in sales using this Experian method.

Keep in mind in the first month of each quarter, Tesla is sending cars to South Korea and a couple other locations. So I'm assuming that number stays the same Oct vs Jan.

If these numbers are to be believed, Fremont is 19% ahead of Q4's production. The one caveat being, Feb will be a shorter production month by 3 days so Feb US sales might be only up 5% over Nov US sales.

Either way, it's bullish. If you remember on the Q4 earnings call, Zach said both Fremont and Shanghai were running below their max capacity due to parts supply. Maybe there were able to get Fremont much closer to max capacity now?

 

[dhanson865]

"The Model Y accounted for 36.8 percent of all BEV sales in the United States, while the Model 3 made up 27 percent. Tesla’s two mass-market vehicles combined for around 63.8 percent of the total electric vehicle sales in January"

If they double US production they end up with what percent? Something like 80-90%?

 

[Ogre]

If they double US production they end up with what percent? Something like 80-90%?

Well keep in mind, the LYRIQ is coming this month and expected to be huge (HUYGQ in Cadillac speak) so that’ll put a big hit in Model Y sales.

So maybe only 79-89%.

 

[Artful Dodger]

Rob Maurer roasts the SEC plan to distribute the $40M agreed-upon settlement. It took over 3 years to come up with this plan?! (mind-blown animation)

"This is NOT complex. This is EXTREMELY simple. There's no problem with that other than the amount of time that it took. The SEC literally could have done nothing, waited until Tesla complained, and then come up with this plan".​

It Took Three Years For THIS? (2:32) | Tesla Daily Podcast on Youtube

Now that SEC has finally submitted a plan, Tesla is arguing against the settlement, so Rob's sure the funds will be on hold anyway until that argument is concluded.

Cheers!

 

[Buckminster]

If nuclear war breaks out... I think we will have much larger issues than what the Tesla stock price is doing.

Yah, those gas masks are much less comfortable than N95s. #steamedupglasses

 

[Ogre]

Rob Maurer roasts the SEC plan to distribute the $40M agreed-upon settlement. It took over 3 years to come up with this plan?! (mind-blown animation)

"This is NOT complex. This is EXTREMELY simple. There's no problem with that other than the amount of time that it took. The SEC literally could have done nothing, waited until Tesla complained, and then come up with this plan".​

It Took Three Years For THIS? (2:32) | Tesla Daily Podcast on Youtube

Now that SEC has finally submitted a plan, Tesla is arguing against the settlement, so Rob's sure the funds will be on hold anyway until that argument is concluded.

Cheers!

Shorts get the same protections and payout as shareholders? That’s my guess for what Tesla is contesting.

 

[thesmokingman]

I saw the the BMW "competition" tonight at a Tennis tournament in Indian Wells CA, up close the front plastic kidneys looked like a Fly's eye under a microscope ("Help Me" came to mind)

That is so Bangled!


When I squint it kind of looks like a beaver.