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

[Krugerrand]

Wait, did they lose $4b+ in a single quarter!?!?

Do y’all remember my post after their last 21Bish funding acquired session where I said something along the lines of; ‘that’s not going to last long’ and there were a bunch of peeps going on about how that was going to be enough money for multiple years -



Now I’m going to remind everyone; what Elon, Tesla and those employees did was nothing short of a miracle. Remember that when you think the likes of Lucid, Rivian, Bollinger et al are going to be able to repeat it.

 

[Ogre]

When I buy shares, I get them from the "street" or the broker, not a specific individual. The broker would have to fail to deliver to me, and that would kill the broker.

RobinHood seems to have gotten away with it. Not entirely unscathed, but they pulled it off.

 

[TheTalkingMule]

Tesla now is entering the big league like Michael Jordan at the beginning of his rookie NBA season. Everyone recognized he was very talented after winning a college basketball national championship and making the game winning shot at the buzzer.

Still, many thought the hype had far outstripped the talent. Two teams had passed up on him in the draft, so he was picked third. Others thought a 6'6" tall shooting guard would struggle against taller NBA competitors--"The Big Boys are coming." The Chicago Bulls were perennial losers too, so he wouldn't have much help from the team.

It only took a few games for the reality to begin to become apparent, even for the most daft of observers.

When Tesla posts 2022 net income of $20+ billion and 80-100% production growth whilst the rest of the industry is going down in flames, the dominance will be undeniable.

The MJ analogy fails in one major aspect. He was playing an athletic game, limited by human physiology; Tesla is playing a technology game, limited only by the laws of physics and creativity. The margin of victory can be orders of magnitude higher in engineering competitions.

Good analogy. I'm sitting here trying to piece together a menu of LEAPs and call spread purchases to add leverage while we're <$1000. Just decided it's not worth it even though we know* TSLA has to be well past ATH this time next year.

I'm going to wait a bit more. Clearly Wall Street is committed to this capping plan and the macros are 50/50 to get worse from here. With any luck, things will remain the same(or get worse) right up to the moment TSLA lays their 1Q earnings on the table. I think you're right that no amount of talk or logic will push us past ATH right now, earnings and execution are what it will take. Is that absurd 1Q earnings or are we gonna go all the way thru 4Q earnings and jump 150%? I assume the former is more likely.

My moment to jump will be in early April if FOMO hasn't hit, we're still touching $780-820 on macro down days, and May20 expiration calls are cheap. That way I can convert shares to ITM LEAPs, a few safe-ish LEAP spreads, and a few cheap near term calls that should* 10x or more. I just keep reminding myself we're at $4000 pre-split, there's no need to lever up unless the opportunity is flashing crimson. We're not there yet.

 

[StarFoxisDown!]

TSLA is nearly down as much as Rivian now.

If you thought I was Mr. Grumpy pants before.......you ain't seen nothing yet.

 

[Singuy]

That's not true anymore............a year ago when Tesla had a Forward P/E of 300+, sure, any hiccup in growth would plummet Tesla's multiple.

But Tesla is likely trading at a Forward P/E of 50 right now (factoring my expectations of Q1 earnings). Meaning the market's expectations for future earnings are 25%.....starting now. Not next year. Not 2024 or 2025. But as in this year Tesla's earnings growth will slow to only 25%. It's so far out of the realm of reality that it's mind boggling.

So I actually don't argue potential when I talk to people that I know that think Tesla is overvalued. That gives them an out in terms of saying "Well I don't believe in that future growth". I use cold hard numbers.

Well there are many other things they build into their DCA.

1. Operating margins will decrease to legacy levels as mass market car comes out/strong competition (assuming FSD will fail with any meaningful take rate)
2. Revenue growth not only falls, but yoy revenue eventually will fall as they try to defend their market share due to competition

We see these things being played out in big auto financials as their company matures, so naturally some bearish analysts will assume the same for Tesla as the company hits their max allowable TAM.

 

[TheTalkingMule]

Bought a single 3/18 $860c @ $7.90

Had to be done. Will sell for $11 at the open Monday if Putin doesn't lose his mind(even more) over the weekend.

 

[StarFoxisDown!]

Well there are many other things they build into their DCA.

1. Operating margins will decrease to legacy levels as mass market car comes out/strong competition (assuming FSD will fail with any meaningful take rate)
2. Revenue growth not only falls, but yoy revenue eventually will fall as they try to defend their market share due to competition

We see these things being played out in big auto financials as their company matures, so naturally some bearish analysts will assume the same for Tesla as the company hits their max allowable TAM.

I know you're just pointing out what bear analysts are saying but those 2 talking points are completely delusional. So delusional that it's more 99% more likely those bear analysts are intentionally (cough rigging) TSLA's consensus price targets and buy to sell analyst recommendation ratios.

 

[ZachF]

TSLA is nearly down as much as Rivian now.

Amazon and Ford finna have some mad write downs for Q1 with RIVN down 63% YTD…

 

[Singuy]

I know you're just pointing out what bear analysts are saying but those 2 talking points are completely delusional. So delusional that it's more 99% more likely those bear analysts are intentionally (cough rigging) TSLA's consensus price targets and buy to sell analyst recommendation ratios.

These analysts follow the auto sectors for decades and they refuse to believe the story will play out differently for any new auto company even though it's playing out differently. I don't think it's intentional, but it's like trying to convince your grandfather of your projection is different even though they lived through a similar situation in the past. You usually get this "you're just being naïve".

 

[StarFoxisDown!]

These analysts follow the auto sectors for decades and they refuse to believe the story will play out differently for any new auto company even though it's playing out differently. I don't think it's intentional, but it's like trying to convince your grandfather of your projection is different even though they lived through a similar situation in the past. You usually get this "you're just being naïve".

I would have agreed with you if we were early to mid 2021. Because Tesla's margins did shrink in Q4 of 2020. Then rebounded in Q1 2021. I could at least understand the other side of the argument in that "Are these margins sustainable?".

But since then, we've not only had margins not go down, but had margin expansion from Q1 to Q2, Q2 to Q3, and Q3 to Q4. So today, anyone using those bullet points I feel is doing so in an intentional way........not because they're just clueless.

The operating margin between Tesla and legacy auto is growing wider and wider. Every analyst should be able to deduct the 350 million options related tax in Q4 to realize that Tela's operating margin was actually about 18%. Their net margin was actually more like 16.5%. Those numbers are 3-4X legacy auto.

 

[wtlloyd]

Millions spent on real estate, millions invested in getting a politically sanctioned monopoly.

They can sell the real estate, they can't ever get that money back they spent on their local politician.

Corporate tax deduction, no?

 

[Artful Dodger]

RIVN's going to beat us today, isn't it? Really can't help but marvel at the insanity.

This chart is not to illustrate SP action on RIVN today, or even to point out that they nearly spiked up to yesterdays Close SP shortly after today's Open. This chart is in fact to illustrated that the owners of the casino brothel which is Wall St. always give themselves an easy out when ever they make a huge, bone-headed mistake (like running RIVN up before "earnings", er, losses).

Big players got off scot-free; retail holds the bag. Rince, repeat.

 

[ZeApelido]

TSLA is nearly down as much as Rivian now.

If you thought I was Mr. Grumpy pants before.......you ain't seen nothing yet.

Me imagining StarFox at a dinner party:

'Hey Star how is your Tesla investment going?"

 

[Curt Renz]

Tesla now is entering the big league like Michael Jordan at the beginning of his rookie NBA season. Everyone recognized he was very talented after winning a college basketball national championship and making the game winning shot at the buzzer.

Still, many thought the hype had far outstripped the talent. Two teams had passed up on him in the draft, so he was picked third. Others thought a skinny, 6'6" tall shooting guard would struggle to shine against stronger, taller NBA competitors--literally "The Big Boys are coming." The Chicago Bulls had been perennial losers too, so he wouldn't have much help from the team.

It only took a few games for the reality to begin to become apparent, even for the most daft of observers. Dazzling execution on the court and amazing stats for a rookie carrying the team on his back became impossible to ignore or rationalize away.

When Tesla posts 2022 net income of $20+ billion and 80-100% production growth whilst the rest of the industry is going down in flames, the dominance will be undeniable.

The MJ analogy fails in one major aspect. He was playing an athletic game, limited by human physiology; Tesla is playing a technology game, limited only by the laws of physics and creativity. The margin of victory can be orders of magnitude higher in engineering competitions.

It was all due to my demand that he do well.

In November 1984 when I was living in Palo Alto away from my native Chicago, my friend the Bulls' TV announcer took me to the cellar of the stadium in Oakland outside the Bulls' locker room. He said I want you to meet their new rookie who was a sensation in college.. He went inside and brought out Michael Jordan for a handshake and brief conversation. I asked Michael to do well that night. He said, "Yes sir, I will." I asked him to do well throughout his career and bring the Bulls a championship. Again, he responded, "Yes sir, I will." He went on to perform beyond expectations.

In early 2013, my former financial TV interviewee Craig Johnson (Piper Sandler) recommended TSLA. His advice also turned out to be sound beyond expectations.

 

[Artful Dodger]

Grabbed my 25 shares again. Why not.

That was rhetorical, right?

MMs didn't even attempt to defend MaxPain at 835. Now perhaps working to hold 800.

 

[M|S|M MYP]

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Tavares confident that Stellantis can catch up with Tesla​

Tavares confident that Stellantis can catch up with Tesla

Stellantis should be able to catch up with electric vehicle pioneer Tesla in the coming years, its chief executive Carlos Tavares said on Friday, adding that competition would benefit consumers.

www.reuters.com

Let's all take a moment and thank them for funding a big portion of Tesla's Gigafactories with their purchases of emission credits all these years.

 

[StarFoxisDown!]

Me imagining StarFox at a dinner party:

'Hey Star how is your Tesla investment going?"

Fairly accurate portrayal of my face this morning (and most days for the past 8 weeks).

In actual Tesla..............even more bullish news. I don't know how much more bullish news I can take since it just means the stock keeps going down

https://twitter.com/x/status/1502384919850455041

S/X spotted at Shanghai. Obviously the first test units for China market. But it does mean that S/X production rates are improving and Tesla expects a pretty big increase in S/X production in Q2. S/X back up to normal production levels of 25k/quarter means very big things for margins.

 

[Artful Dodger]

The market really is fascinating.

Tesla has had nothing but positive tangible catalysts like gas prices driving orders up 100%, expansion of existing factories towards spectacular volumes, 2 brand-new cutting edge factories eminently opening, nimble,and advanced plans or long-term contracts for all the relevant latest material and component "shortages" AND dreamy financial performance and forecasts. The world is currently and literally in chaos due to the lack of more of Tesla's various products. It's quite an amazing time for the company looking forward....and yet, as I write this, TSLA is 4x below QQQ and F...GM is GREEN. So, while I have always felt that I understand Tesla far better than most, how can others really be this clueless? HODL.

Wall St. still thinks they can beat Elon. And they're willing to go broke trying.

 

[Curt Renz]

...MMs didn't even attempt to defend MaxPain at 835. Now perhaps working to hold 800.

The macros appear mired in risk-off status before a weekend with the war in Ukraine continuing. That drags down TSLA and other auto stocks.

 

[traxila]

Weird close. QQQs dove along with the whole market into the close hitting day lows. TSLA was killed all day but stayed steady at the lows it had already set while the rest of the market dove. I have no idea….

Good news is QQQs still above near term bottom and support they set in the past couple of weeks.

How lovely would it be for peace in the Ukraine over the weekend!

All the best!