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

[scubastevo80]

What are the “advanced notice” rules for a buyback? Are there any? My understanding is that they just need board approval and to file the forms.

Assuming Elon’s done selling, we should be near bottom here, with Q4 numbers looking good so far.

Especially with buyback tax rules becoming less favorable on Jan 1, now or soon would be a good time to buy some TSLA, Tesla.

Key part of this is "should be" near the bottom. Another macro leg down and TSLA will certainly be going with it.

From a pure valuation perspective, TSLA stock isn't cheap if you look just at the auto business. I, like many of us, realize this is a growth play and things like FSD, Optimus, Energy and Robotaxi make TSLA worth many more times than its current price. But in this environment, no one is paying up for growth and companies are being absolutely punished for missing estimates, whether they're growing at 5% or 50% per year. For me, it's hard to get excited that we're past the worst of it. I'd rather miss the bottom and ride the next wave higher than get in too early and sit on flat/down performance for the next 6-12 months.

 

[Artful Dodger]

Until an accountant confirms Elon has all the capital after taxes to close the Twitter deal once and for all, I am not ready to say it’s the end of Elon’s selling yet.

Haha, that's really not the bulk of the capital he requires. Since Elon has 12 tranches from his 2018 CEO comp plan, does he now have enough capital to pay the taxes when he exercises those shares? Or, will he need to sell shares to pay the income taxes like the 2012 CEO plan tax sales last Nov?

That exercise day is coming. Sooner, if you belief Elon would execute his options at the lowest SP to minimize his taxes. Or later, as @mongo has explained, toward the end of the eligibility period in 2018, if Elon wants to maximize his gains (while paying higher total taxes). Keep in mind, this affects Tesla too since they have to pay income tax separate from Elon's tax bill.

If the SP does remain low, I'd like to see Elon execute as many share options now and pay taxes with cash on hand (w/o selling). Then, execute the remainder near the end of the eligibility window, sometime in 2028. Hope he's getting good advice. This could remove a trillion dollar overhang over TSLA's Market Cap in 2028.

 

[traxila]

Shanghai production was 88k in October. About damn time we got some positive data.

Of course……Rueters “reports” this as 16k in inventory even .

We know what Reuters is all about.

16K undelivered is about five days of production. It is more than reasonable to expect a week's lag from production to official delivery.

These are spectacular numbers and, short of a shutdown, make a number in the low 270s a possibility for Shanghai.

450K delivered seems very solid and conservative.

Do we always have to put disclaimers here now re: force majeure?

 

[phantasms]

Key part of this is "should be" near the bottom. Another macro leg down and TSLA will certainly be going with it.

From a pure valuation perspective, TSLA stock isn't cheap if you look just at the auto business. I, like many of us, realize this is a growth play and things like FSD, Optimus, Energy and Robotaxi make TSLA worth many more times than its current price. But in this environment, no one is paying up for growth and companies are being absolutely punished for missing estimates, whether they're growing at 5% or 50% per year. For me, it's hard to get excited that we're past the worst of it. I'd rather miss the bottom and ride the next wave higher than get in too early and sit on flat/down performance for the next 6-12 months.

With you. I’m waiting for VIX spike, more forced liquidations, and panic to add ~10% to my position. I’d rather be 9/10Tesla and cash than 10/10 right now. If I miss the bottom so be it. I’ve been 10/10 earlier in the year and it didn’t feel as good as where I’m currently sitting.

 

[ThisStockGood]

Model Y doing ok in China:

https://twitter.com/x/status/1590334184525991936

 

[Todd Burch]

We know what Reuters is all about.

16K undelivered is about five days of production. It is more than reasonable to expect a week's lag from production to official delivery.

These are spectacular numbers and, short of a shutdown, make a numbers in the low 270s a possibility for Shanghai.

450K delivered seems very solid and conservative.

Do we always have to put disclaimers here now re: force majeure?

The 16k undelivered lines up with rumors we heard at the very beginning of November, when it was reported that many cars were awaiting registration.

 

[wipster]

Friday morning looks (to me) like Thursday morning, but with a continued drop.

Ok stock people, can someone explain this?
Per https://www.nasdaq.com/market-activity/stocks/tsla/historical

Nov 8th high was $195.20
Elon had three groups of sales with prices above this, highest was $197.79

Nov 7th high was $208.90
Elon had sales up to $209.02

Someone is off on their records... [edit: or trading in non-market hours?]

Must have been non-market. Just looking at my chart, I see pre-market on Monday there was sales of 65k at 209.02 at 8 am est. Yesterday at 7:35 there was a small sale at 197.79.

 

[UncaNed]

Hi guys! I'm considering adding some leaps with 2024/2025 expiry, but first want to try to understand if there's any realism to wallstreets EPS estimate of 5,76 for 2023.

Personally, I don't see any realistic scenario where tesla is producing less than 2,1M vehicles next year. 2,1M would already mean they that their growth numbers for both shanghai, texas and berlin will be ridiculously low. What they are able to sell on the other hand could be challenged by a recession - especially in china which is a substantial amount of their market. If they on the low end would only manage to sell 2M vehicles in 2023, they would still have to drastically lower prices and margins to get to less than 6 eps for the full year.

More realistically i would guess we are looking at some price decreases, more standard range versions sold, some cost reductions, and a fair increase in production in both Texas, Berlin and Shanghai (and some in Fremont). Most likely i would guess we are looking at around 2,3-2,5M vehicles produced and 2,1-2,3M vehicles delivered (with the potential to go higher) which would most likely mean a FY EPS of around 7 to 8. If we get anywhere near 7 eps for 2023 i think today's valuation is laughable and the stock price will be forced up as PE falls and earnings growth outperforms by extreme margin.

Any thoughts?

Latest expirations are safer, I'd only do 2025 expirations, and I think you'd better be good at rolling them over to later expirations if needed. Because the world is a much, much more risky place that it's been for the last decade, so I'm not sure I'd buy LEAPS at all right now. Shares are much safer.

A year or two ago, someone posted here about really losing their shirt with LEAPS back around 2016 or 2017 when the stock price just languished rightward; that could easily be us.

Just my $.02, not advice.

 

[Congo Line]

https://twitter.com/x/status/1590297909567922176

"A dark black cloud over the Tesla story"

https://twitter.com/x/status/1590187060811689984

Dan Ives is a blowhard who does a good impression of someone who knows what they’re talking about; made the mistake of selling TWTR at $35 after he claimed the deal was dead. No longer put much stock in what he says.

 

[Krugerrand]

GB worrying about blue bird check becoming an echo chamber, he needs to come round here some.
(@Krugerrand no need to disagree, it is just assumed at this point)

Yeah, that doesn’t save you the disagree, especially when clearly there isn’t an echo chamber here with you and others doing a bang up job creating, cultivating and distributing dissent by the bucket. The community is now divided like the country and the world. The pride you must feel for a job well done.

 

[elasalle]

With Chinese engineers coming to Fremont to improve production there, let’s estimate 150k from Fremont for Q4 (Q3 was 140k, Q2 was 133k).

Can't believe Fremont needs Chinese expertise and how much do they want to scale Fremont anyway?

"speculation" -Is this just pretext to have Chinese engineers in Fremont to work on the Model 2/Q line? All research, iterations still happens in Fremont .. (+Assumes M2/Q will be built in China)
Also if EM sees recession , 4680 production is improving, and China demand is peaking (duck) (see Rob's video from yesterday) -- what better way to be recession proof than to plan for a more affordable car. cheers!

(+ and M2/Q will come before robotaxi)

 

[mongo]

Haha, that's really not the bulk of the capital he requires. Since Elon has 12 tranches from his 2018 CEO comp plan, does he now have enough capital to pay the taxes when he exercises those shares? Or, will he need to sell shares to pay the income taxes like the 2012 CEO plan tax sales last Nov?

That exercise day is coming. Sooner, if you belief Elon would execute his options at the lowest SP to minimize his taxes. Or later, as @mongo has explained, toward the end of the eligibility period in 2018, if Elon want to maximize his gains (while paying higher total taxes). Keep in mind, this affects Tesla too since they have to pay income tax separate from Elon bill.

If the SP does remain low, I'd like to see Elon execute as many share options now and pay taxes with cash on hand (w/o selling). Then, execute the remainder near the end of the eligibility window, sometime in 2028. Hope he's getting good advice.

304 million shares @ 50% tax (Federal (37%), proportional CA (12.3% + 1%), medicare (1.45%+.9%) with $23 basis would incur $26 billion in taxes.
He also needs $23*304 = $7B just to exercise the shares. He will need to sell TSLA. Unless he re-IPOs Twitter before then and sells that. Perhaps Tesla can buyback from him...

Exercising sooner would reduce Tesla's 1.45% medicare payroll tax obligation on the gains, but it's not in Elon's best interests (if tax rates stay the same). Currently, the basis is 12% of the award value. He loses the growth on that portion once he exercises.

 

[InDaClub]

GB worrying about blue bird check becoming an echo chamber, he needs to come round here some.
(@Krugerrand no need to disagree, it is just assumed at this point)

But first, please tell Gary he’ll have to endure your ridiculous run rate nonsense.

 

[ggies07]

Random data point: It seems one of the families at the school I work for has a Rivian R1S and I saw it for the first time this morning....looks very nice and love the dashboard. Didn't think they were making them yet....

 

[ItsNotAboutTheMoney]

Can't believe Fremont needs Chinese expertise and how much do they want to scale Fremont anyway?

"speculation" -Is this just pretext to have Chinese engineers in Fremont to work on the Model 2/Q line? All research, iterations still happens in Fremont .. (+Assumes M2/Q will be built in China)
Also if EM sees recession , 4680 production is improving, and China demand is peaking (duck) (see Rob's video from yesterday) -- what better way to be recession proof than to plan for a more affordable car. cheers!

(+ and M2/Q will come before robotaxi)

More affordable is just another step. They've denied it in the past, but investors always want to hear that they're selling premium.
Without a radical shift in trade policy and tax credits, I don't see the M2/Q being built in China and imported to the USA. If they sell in the USA at all, it'll be built in NAFTA.

Bringing Chinese engineers in makes sense if they're re-implementing stuff from Shanghai, especially if it's related to the use of the CATL LFP cells.
And the engineers will probably be glad to be out of China right now.

 

[SarahsDad]

Dan Ives is a blowhard who does a good impression of someone who knows what they’re talking about; made the mistake of selling TWTR at $35 after he claimed the deal was dead. No longer put much stock in what he says.

Haha plus he wrote “exacerbated” when he meant “exasperated”. Attention to detail is important.

 

[elasalle]

More affordable is just another step. They've denied it in the past, but investors always want to hear that they're selling premium.
Without a radical shift in trade policy and tax credits, I don't see the M2/Q being built in China and imported to the USA. If they sell in the USA at all, it'll be built in NAFTA.

Bringing Chinese engineers in makes sense if they're re-implementing stuff from Shanghai, especially if it's related to the use of the CATL LFP cells.
And the engineers will probably be glad to be out of China right now.

M2/Q will be released in China 1st so 1st production line will go there. It will be for China and ROW.
Based on IRA, US might not need M2/Q for a long time .... also US has another segment in CT's. CT sales in China/EU will be low volume.

 

[M|S|M MYP]

Shanghai production was 88k in October. About damn time we got some positive data.

Of course……Rueters “reports” this as 16k in inventory even .

And of course on a day when market is down

 

[Cosmacelf]

Random data point: It seems one of the families at the school I work for has a Rivian R1S and I saw it for the first time this morning....looks very nice and love the dashboard. Didn't think they were making them yet....

I've got one myself, just a few days ago. Probably the 15th in San Diego region. It's my wife's so I haven't driven it much, just the one trip to the car audio place to install an XM radio. For an "adventure" brand, pretty dumb not to have satellite radio. Will give my impressions in the Rivian thread when I get it back this morning and do some more driving.

 

[wipster]

And... down she goes. Man, I woke up way too early this morning, definitely need my coffee...