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

[kbM3]

I think you now understand why I keep predicting TSLA's PE Ratio will continue to fall over time along the declining trend line, thereby holding the stock lower than most people feel it should be at!

I'd say retail investor confidence is very strong, BUT most retails who want to own the stock already have it, they don't seem to be buying in large quantities any more. What needs to happen to truly move the stock and PE up is Wall Street buying, and like you state above, I too feel pro investors lack confidence in Tesla's future to really drive it up right now. Whether that is because they don't understand Tesla, or they don't trust Elon, or they don't LIKE Elon, or they feel TSLA is still overvalued, or how the stock is still rated junk credit wise, and so on. Whatever the reason, Wall Street isn't buying TSLA en masse right now, and this meager volume allows the MM's to control the price nearly completely, and UNTIL THAT CHANGES I feel the stock will continue to be held well under it's ATH.

That might be a period of a few weeks or months, or it could be a few years yet, without a crystal ball no one knows. But new buyers and volume need to come in to break us out of this MM rut, and for now I don't see that happening. The split and subsequent lower share price might bring in new retail, but I doubt it will be enough volume to overwhelm the MM's.

Investors who want to own TSLA already do, and new buyers aren't coming right now due to a myriad of reasons.

My hunch is we have a good year or two yet until the stock breaks way out again, and by then we'll likely have a PE less than 60 due to manipulation and earnings compression.

View attachment 839102

I’m pretty sure Wall St. is not pricing Tesla higher for two primary reasons:

1) When Elon stated they have not even begun work on the $25k car, Wall St. lost visibility on how Tesla can achieve 50% growth after 2023. Tesla has mentioned a Robotaxi as the next vehicle, but they won’t give credit for that until FSD is performing far better.

2) Inflation means Tesla’s future cash flows are far less valuable than they were as they’re using a much higher discount rate.

Both boil down to their spreadsheets yielding a worse number. Many are not willing to give Tesla credit for 50% growth the rest of this decade, whereas we do.

 

[Big Time]

Probably what leads to shorts losing so much money is weeks like this…..

Demented stock, massive manipulation, moving opposite macro.
It’s like the stock is temporarily dead, if I was an idiot shorty I’d look at the chart and say “it’s toast”

So many moving pieces. Shorties and WallStreet want everyone’s Covid relief money two times over.

 

[Mengy]

Probably what leads to shorts losing so much money is weeks like this…..

Demented stock, massive manipulation, moving opposite macro.
It’s like the stock is temporarily dead, if I was an idiot shorty I’d look at the chart and say “it’s toast”

Yeah this mornings price action is bizarre. TSLA is one of the few stocks on my watchlist in the red right now.

Eh, maybe I'll buy a few more shares, it's better than letting the cash sit in my emergency fund.

 

[Boomer19]

Worth a read for a laugh. It's amazing to see how delusional and warped the perspectives of Spiegel and GJ in particular really are, just amazing.

textbook example of how NOT to trade

they are so delusional they stopped attempting to hide their emotional bias

 

[Singuy]

Yeah this mornings price action is bizarre. TSLA is one of the few stocks on my watchlist in the red right now.

Eh, maybe I'll buy a few more shares, it's better than letting the cash sit in my emergency fund.

Must be MM manipulation kabuki theater naked short selling because twitter/Musk overhang doesn't exist.

World class execution, red on one of the greenest macro days.

I must have imagined Tesla going red on the day Musk announced twitter buy out and Tesla being green on the day he backed out..but twitter overhang doesn't exist..

 

[jeewee3000]

textbook example of how NOT to trade

they are so delusional they stopped attempting to hide their emotional bias

I found some of their comments in very poor taste. Especially Spiegel.

 

[JupiterMan]

Is anybody thinking of investing in TSLL at all? Most of my money is in UK ISA & SIPP so I've no options available except directly buying/selling stocks, but this is available.

Would appreciate anyone's thoughts on it.

Not for me, but can understand attraction if you are a hyper bull.

There is also 2TSL which is 2 x leveraged and available in UK.

Just be aware of fees (around 2.8% for 2TSL), counterparty risks, also daily rebalancing which can eat into returns on any down cycle.

 

[Gigapress]

I’m pretty sure Wall St. is not pricing Tesla higher for two primary reasons:

1) When Elon stated they have not even begun work on the $25k car, Wall St. lost visibility on how Tesla can achieve 50% growth after 2023. Tesla has mentioned a Robotaxi as the next vehicle, but they won’t give credit for that until FSD is performing far better.

2) Inflation means Tesla’s future cash flows are far less valuable than they were as they’re using a much higher discount rate.

Both boil down to their spreadsheets yielding a worse number. Many are not willing to give Tesla credit for 50% growth the rest of this decade, whereas we do.

The sad thing is that neither of these are good reasons and professional analysts should be doing better than this.

1) Tesla can obviously achieve 4-6 million annual vehicle sales at today's profit margins just with S3XY and Cybertruck, especially if they 1) actually sell low-end variants in volume and 2) lower prices as costs fall and demand at current prices begins to saturate. Furthermore, profit margins on non-Fremont Ys and Cybertrucks will probably be $25k after 2023, so who cares about allocating supply towards a car that generates only $25k in revenue with a best-case scenario of maybe $10k profit per unit?

2) Inflation should also be increasing Tesla's future cash flows by an amount identical to the rate of inflation. If Wall Street isn't adjusting for anticipated price rises for the products Tesla sells, then they aren't doing their jobs competently. Economics 101 class teaches this to 18-year-olds. Holding all else equal, inflation driven by an increase in the money supply does not affect the "real" value of equity in stocks. In other words, the true value of a company is the net present value of the future economic utility flows created, and the future cash flows are just a measurement of that utility. Inflation has approximately zero effect on the utility component; it just changes the scale of the measurement, like switching from inches to centimeters.

 

[Nocturnal]

I expect TSLA to go up massively in the next 2 months. Why not buy more LEAPS I ask myself? I already have 50% value in LEAPS - it would be crazy to buy more. Well I won't sit idly by if I am wrong. If the SP is <$400 (post split) the day before Q3 ER (probably 18th Oct & following at least some of the early TWTR case FUD), I will sell shares to buy more LEAPS.

Who is with me?

17th Aug - Split share ownership date
20th Aug - FSD 10.69 drops
24th Aug - Split
Sep? - FSD V11
30th Sep - AI day #2
2nd October? - P&D
17th October - TWTR trial starts
19th October? - ER
21st October - TWTR trial ends
21st October - Earliest date Elon could re-buy TSLA

I've been tempted, but you left out macro and black swan risks. I'm trying to stick to my 25% max options (23-24 conservative leaps) rule myself. I could stomach that risk, but 50% options is something else. Just a thought.

2) Inflation should also be increasing Tesla's future cash flows by an amount identical to the rate of inflation. If Wall Street isn't adjusting for anticipated price rises for the products Tesla sells, then they aren't doing their jobs competently. Economics 101 class teaches this to 18-year-olds. Holding all else equal, inflation driven by an increase in the money supply does not affect the "real" value of equity in stocks. In other words, the true value of a company is the net present value of the future utility flows created, and the future cash flows are just a measurement of that utility. Inflation has approximately zero effect on the utility component; it just changes the scale of the measurement, like switching from inches to centimeters.

Thank you. Inflation only harms cash flows if you don't have pricing power. Tesla does.

Tesla shares are measured in dollars, dollars are decreasing in value, the denominator is the same!

 

[henchman24]

Right at 13k... we will see how strong resistance is. With how the PPI came in cold, I can't see the market putting up a huge fight.

 

[Boomer19]

I found some of their comments in very poor taste. Especially Spiegel.

he’s an idiot of epic proportions

 

[M|S|M MYP]

Worth a read for a laugh. It's amazing to see how delusional and warped the perspectives of Spiegel and GJ in particular really are, just amazing.

This one was the best:

Losses only for dumb a** people that short $TSLA

 

[JRP3]

Suggest watching this video of Elon talking 8 minutes about the upcoming 12-18 months recession.

PPI numbers look good… support the narrative that inflation has peaked.

Producer Price Index Home : U.S. Bureau of Labor Statistics

www.bls.gov

And Core PPI now down to 7.6% (Year over Year) . . .a nice move down. The lowest in 8 months.
This bodes well for the CPI as the PPI is a leading indicator.

View attachment 839565

Core PPI excludes Food and Energy.

Seems as though indicators are not suggesting a recession.

 

[CHGolferJim]

Do you realize how scarce and expensive land is in Singapore?

Do you know Singapore well? I haven’t been there in 30 years, and then only to the urban area. I just looked at a map and it looks like there may be undeveloped lands, possibly with industrial zoning. Obviously, a world class port and labor pool.

 

[TheTalkingMule]

Coming out of the MMD I'm sure MM algos would like to keep TSLA in a position to stay <900 close Friday.

Not sure they have a chance on a day like today with macros pumping.

 

[henchman24]

Coming out of the MMD I'm sure MM algos would like to keep TSLA in a position to stay <900 close Friday.

Not sure they have a chance on a day like today with macros pumping.

900 is probably more around the macro... if the macro takes off (say 4-5% from here), 900 would be incredibly hard to hold. If 13k keeps resistances through tomorrow, or only slight above... then they will try to keep it under 900.

 

[M|S|M MYP]

Do you know Singapore well? I haven’t been there in 30 years, and then only to the urban area. I just looked at a map and it looks like there may be undeveloped lands, possibly with industrial zoning. Obviously, a world class port and labor pool.

Lived there for 13 years, have relatives that still live there. There is land available but it is ultra expensive which is why the HDB (Housing and Development Board) of Singapore is constantly struggling to provide affordable housing and can only build up. If you own a detached house in Singapore, you are part of the wealthy crowd

That was in 2020, you can only imagine how much more it is now.

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Mod: this post and the previous one are taking the discussion about possible future Gigafactory locations way too far OT. The discussion died on Monday, let's not revive it three days later.

 

[StealthP3D]

Whether he ends up acquiring Twitter or not, it's been bad for Tesla and Tesla shareholders. I don't need a court to tell me this has been a show.

I am a huge Tesla fan. Obviously, Tesla and Musk have done some amazing things, but he also sometimes makes mistakes:

• The "funding secured" tweet, whether or not he thought it was true at the time, was a bad idea.
• Calling that dude a pedophile on Twitter was a bad idea.
• Buying a billion dollars of Bitcoin with Tesla's spare cash at about $33,000 then selling it at about $30,000 was a bad idea (for more reasons than simple finance).
• Backing himself into the risk of being forced to buy a company he doesn't want at a price it's not worth is also a bad idea.

I want the man to focus on the mission. The misadventures above ain't it.

Elon is focusing on the mission by acquiring Twitter, you are just slow to see how valuable it is to the mission. And that's coming from someone who despises Twitter and doesn't even have a Twitter account. You say you want the focus to be on the mission, but, before you can say how to most effectively focus on the mission, it is necessary to understand the biggest challenges standing in the way of completing the mission. The mission is not so much a technical challenge, but a social and political one. Think about that...

Personally, I hope all the people blind enough to think Twitter is a worthless distraction would use that as a reason to sell all their TSLA. They will have quite a shock when they finally learn that Elon actually did understand the mission, it's challenges, and how to most quickly solve it. And was willing to put his most valuable resource, his time, towards solving it, and all of his own personal assets. We don't need people who want to direct the mission when they have demonstrated they don't even understand the challenges facing the mission by being so narrowly focused on making money in the short-term, at the expense of all else. Elon has the big picture and it's baffling to me why some people don't understand that.

 

[bkp_duke]

I had not seen this article posted. It reads like it was a group interview. I’ve skimmed it and find the discussion intriguing, especially for those who believe Musk is not honest and that Tesla is a complete fraud of a company.

https://nymag.com/intelligencer/2022/08/elon-musk-tesla-short-sellers.html

Might be paywalled and visit limited. Please enjoy.

Beautiful. So much crying over spilt milk by our short friends. Best read in at least a week for me!

 

[bkp_duke]

textbook example of how NOT to trade

they are so delusional they stopped attempting to hide their emotional bias

I really liked seeing Andrew's perspective in that conversation. He's the only one that it even "clicked" a little bit.