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

[M|S|M MYP]

Another boring day of $TSLA being smacked down, but this should cheer everybody up from another beloved wall street analyst Gene Munster:

https://twitter.com/x/status/1593321181041479680

Apparently, RJ Scaringe, Doug Field, Jeff Bezos, Peter Rawlinson are out, according to Mr. Munster.

But, you sure you didn't leave someone out, such as YouLed Mary, Dear Sir?

This guy might be available in a few years:

 

[GrimRe]

Catalysts for Q4 earnings:

1. Shanghai utilization back to 100% meaning GM improvements
2. Berlin and Austin at GM neutral
3. 440K deliveries at $15k profit per vehicle $6.6B in EBIT
4. SG&A flat at $1B
5. Energy division GM profitable
6. $1B in deferred FSD revenue recognized

$2 EPS not out of the question. Imagine doubling earnings q/q

 

[H Mak]

Well buy-and-hold folks, you can start shaking your heads now. I just put my brass balls and peanut brain on the table, and converted my shares to LEAP call spreads. I'm basically all LEAP call spreads now (250 / 400). I just can't see the share price staying this depressed for 2 years given even a conservative growth in earnings and PE ratio. And I'm willing to risk a lot on that bet.

Shorter term - 1 year: This means my trade moves ~ 2x with TSLA price changes. Don't have to wait until expiration to exit.

1.5 - 2ish years:

> ~$350 share price: 500% return on investment (vs 110% for shares)

~ $300: 150% ROI (vs 70% for shares)

~ $280: Same as holding shares

< 250:

So you can monitor my mood over the next 2 years with this simple breakdown.

If the stock is under $250 in 2 years, don't be surprised if I disappear only to be seen on Twitter raging on how VW software is far superior to Tesla's.

Good luck. If your investment strategy matches your humour you'll be just fine

 

[elasalle]

Another boring day of $TSLA being smacked down, but this should cheer everybody up from another beloved wall street analyst Gene Munster:

https://twitter.com/x/status/1593321181041479680

Apparently, RJ Scaringe, Doug Field, Jeff Bezos, Peter Rawlinson are out, according to Mr. Munster.

But, you sure you didn't leave someone out, such as YouLed Mary, Dear Sir?

I haven't seen a meme from any of these guys, I dis-qualify them all.

 

[Ogre]

A billion buyback is like virtue signaling.

They got about 20 B in the bank and as I said previously, that is not as much as you think in this industry.

What does BTC have to do with anything at this point? Past actions aside….

This is how buybacks work. Responsible companies only rarely drop huge amounts of money in short periods of time. Apple did so only when they had literally 100s of billions sitting in the bank and even then it was metered out. For a rapidly growing company, Tesla doesn't have a massive cash horde and we're in the middle of a recession.

A billion dollar buyback would be what I call a nice start to a long term buyback policy. As their cash reserves grow, they can expand the program. Apple's goal was to be cashflow neutral with $100b or so in liquid assets. I don't think Tesla needs $100b, but they should keep a reserve. As much as we like to think their demand is bulletproof, a deep recession can be unpredictable.

 

[elasalle]

This is how buybacks work. Responsible companies only rarely drop huge amounts of money in short periods of time. Apple did so only when they had literally 100s of billions sitting in the bank and even then it was metered out. For a rapidly growing company, Tesla doesn't have a massive cash horde and we're in the middle of a recession.

A billion dollar buyback would be what I call a nice start to a long term buyback policy. As their cash reserves grow, they can expand the program. Apple's goal was to be cashflow neutral with $100b or so in liquid assets. I don't think Tesla needs $100b, but they should keep a reserve. As much as we like to think their demand is bulletproof, a deep recession can be unpredictable.

if the board has confidence in TSLA, confidence in Elon, confidence in 4Q and confidence in themselves, then announcing a buyback would instill confidence in the market.
Simple as that.
hey we might even ensnare Warren with the buybacks. ..

 

[Ogre]

if the board has confidence in TSLA, confidence in Elon, confidence in 4Q and confidence in themselves, then announcing a buyback would instill confidence in the market.
Simple as that.
hey we might even ensnare Warren with the buybacks. ..

Sure.

Apple's board and the BRK board both announced $XXX billion in buybacks under YYYY conditions. Tesla might approve a $10b buyback but only actually deploy $1b.

The board announcing it is more a matter of setting expectations than a legal requirement.

 

[betstarship]

Very much worth a watch

 

[Artful Dodger]

A survey of today’s open interest and trading volume in TSLA options, suggests that $180 would be the most profitable target for big option writers (hedge funds & market makers) with the ability to temporarily influence the share price.

 

[StarFoxisDown!]

Same story I've read in this thread for years. "Next quarter! That's when wall street will see value and tsla will rise"

Soon we will start seeing the next event being hyped in this thread. Then people will estimate a surprise beat in delivery numbers higher than expected.

Then people are disappointed.

But next quarter!

I get it....but let's recap 2022 shall we:

Q4 2021 - P/D numbers return the stock to ATH to begin 2022, macro's take a dive

Q1 - Q1 Earnings take the stock back up to 1100/share pre split even though China covid policy has 1-2 week impact at end of Q1 - TSLA beating Nasdaq %-wise straight up - Rally above 1100 capped by Elon's twitter announcement and selling during Q2

Q2 - Major production impact from China Covid policy, Berlin first deliveries start and thus start of cost such as depreciation/amortization hitting gross margins (same from Shanghai as well due to downtime). Still at a couple times during Q2, TSLA was beating the Nasdaq straight up % wise until Elon capped the stock again with more selling.

Q3 - Stil major production interruption from Shanghai upgrades that were supposed to happen in Q2. Austin begins deliveries and thus Austin in addition to Berlin and Shanghai hitting gross margins mainly from depreciation/amortization. Tesla decides to start to end the wave without forecasting that and thus demand worries are front and center. Elon continually keeps selling.

TSLA was holding up just fine thanks to the business executing extremely well considering the circumstances until the Twitter fiasco started. When those outside circumstances started to really cap Tesla's ability to post bigger numbers, we started to see the impacts of Elon outweigh Tesla's execution.

Q3 was supposed to be the start of getting back to Tesla's business outweighing Elon and then we got the Q3 numbers and it all went downhill. That's on Tesla.....they should have much more clearly forewarned that the wave was ending and should have tempered expectations on gross margin because of the impacts of Berlin/Austin and especially the downtime at Shanghai.

Hence why.....Q4 will be one of the most pivotal quarters for Tesla ever. So far at least, it's been a quarter unaffected by outside circumstances where both Austin and Berlin are clearly at much higher average production rate than in Q3 and Shanghai is producing without any hiccups. The business, growth, and earnings will outweigh Elon if Tesla can just get one quarter of smooth sailing. I know it doesn't seem like it's smooth sailing right now but in reality, all 3 factories are doing exactly what they should be doing.

 

[ZeApelido]

Good luck. If your investment strategy matches your humour you'll be just fine

 

[StarFoxisDown!]

I can't shake this feeling of deja vu...
People were posting similar statements about Q3 IIRC, but then reality hit hard

Q3 is on Tesla, they should have given a much clearer forecast on the Q2 earnings that they were ending the wave. It's entirely possible that it's just like they say and pivoted at the last moment to be more efficient. But as company, you're going to get punished for that on your stock.

But the main reason Q3 disappointed was the production numbers. The YoY growth % was good, but on a QoQ basis, it doesn't look that good. We know why, we also know it's going to be spun a certain way. It is what it is. Tesla is unfairly required to post amazing numbers while plenty of other companies seem to be able to post subpar numbers and still get a higher multiple.

However, in Q4, we already have plenty of data to know that production will come in at least 450-460k with it probably coming in around 475-480k. That's 30% growth QoQ.

Longer term in 2023, the circumstances that limited Tesla in 2022 will turn into tailwinds in 2023, with Tesla posting higher % growth numbers every quarter, all throughout 2023 than they would have otherwise.

 

[Xepa777]

I get it....but let's recap 2022 shall we:

Q4 2021 - P/D numbers return the stock to ATH to begin 2022, macro's take a dive

Q1 - Q1 Earnings take the stock back up to 1100/share pre split even though China covid policy has 1-2 week impact at end of Q1 - TSLA beating Nasdaq %-wise straight up - Rally above 1100 capped by Elon's twitter announcement and selling during Q2

Q2 - Major production impact from China Covid policy, Berlin first deliveries start and thus start of cost such as depreciation/amortization hitting gross margins (same from Shanghai as well due to downtime). Still at a couple times during Q2, TSLA was beating the Nasdaq straight up % wise

Q3 - Stil major production interruption from Shanghai upgrades that were supposed to happen in Q2. Austin begins deliveries and thus Austin in addition to Berlin and Shanghai hitting gross margins mainly from depreciation/amortization. Tesla decides to start to end the wave without forecasting that and thus demand worries are front and center. Elon continually keeps selling.

TSLA was holding up just fine thanks to the business executing extremely well considering the circumstances until the Twitter fiasco started. When those outside circumstances started to really cap Tesla's ability to post bigger numbers, we started to see the impacts of Elon outweigh Tesla's execution.

Q3 was supposed to be the start of getting back to Tesla's business outweighing Elon and then we got the Q3 numbers and it all went downhill. That's on Tesla.....they should have much more clearly forewarned that the wave was ending and should have tempered expectations on gross margin because of the impacts of Berlin/Austin and especially the downtime at Shanghai.

Hence why.....Q4 will be one of the most pivotal quarters for Tesla ever. So far at least, it's been a quarter unaffected by outside circumstances where both Austin and Berlin are clearly at much higher average production rate than in Q3 and Shanghai is producing without any hiccups. The business, growth, and earnings will outweigh Elon if Tesla can just get one quarter of smooth sailing. I know it doesn't seem like it's smooth sailing right now but in reality, all 3 factories are doing exactly what they should be doing.

1) Honestly, I think "the wave" is a cover narrative for short term demand pockets, mainly China, that they need to figure out how to redistribute supply to other countries. And eventually when/where to enable price cuts to stimulate demand.

2) I think Q4 numbers will be bad because lots in the US will want to defer deliveries until 2023 for the tax credit. It's a pretty big difference in cost. "Oh you'll be moved to back of the line!" For $7500 difference in a recession (and shrinking wait times), who cares?

3) Tesla needs to do a better job of forward guidance like you said.

4) Q1 2023 is going to be spectacular, and I'm fully onboard with the Berkeshire conspiracy theory around Tesla lol.

 

[Mirindi]

I can't shake this feeling of deja vu...
People were posting similar statements about Q3 IIRC, but then reality hit hard

Agree, feels like many people thought Q3 results would do us good, but nope...

Would be nice with some good news directly from Tesla, guess the Semi event is the next thing to look forward to but not putting to much hope into it changing the overall narrative of the stock short-term. Still feeling good about the company longterm but many of the negative/unfortunate events these past months have just felt so... unnecessary.

 

[MC3OZ]

The current stock price is insane.
Rivian have made no dent, Lucid still struggle to make any serious amount of EVs. GM are miles away from a serious scaling strategy, VW just basically admitted they are useless, and toyota still believe in the hydrogen fairy.

Meanwhile Tesla are scaling like crazy, 2 factories ramping, and a new product gets delivered in just under 2 weeks time.
And people out there must be SELLING tesla stock?

Seriously considering selling a huge pile of other stocks I have, to double down on TSLA. this price is absolutely insane.

Short sellers are slow learners.

 

[Discoducky]

Q3 is on Tesla, they should have given a much clearer forecast on the Q2 earnings that they were ending the wave. It's entirely possible that it's just like they say and pivoted at the last moment to be more efficient. But as company, you're going to get punished for that on your stock.

But the main reason Q3 disappointed was the production numbers. The YoY growth % was good, but on a QoQ basis, it doesn't look that good. We know why, we also know it's going to be spun a certain way. It is what it is. Tesla is unfairly required to post amazing numbers while plenty of other companies seem to be able to post subpar numbers and still get a higher multiple.

However, in Q4, we already have plenty of data to know that production will come in at least 450-460k with it probably coming in around 475-480k. That's 30% growth QoQ.

Longer term in 2023, the circumstances that limited Tesla in 2022 will turn into tailwinds in 2023, with Tesla posting higher % growth numbers every quarter, all throughout 2023 than they would have otherwise.

Lower ASP got me on my prediction. Didn't see that coming. Q4 might be hard to predict as well...for ASP.

 

[mongo]

But the main reason Q3 disappointed was the production numbers. The YoY growth % was good, but on a QoQ basis, it doesn't look that good. We know why, we also know it's going to be spun a certain way. It is what it is. Tesla is unfairly required to post amazing numbers while plenty of other companies seem to be able to post subpar numbers and still get a higher multiple.

They said in Q2 they would have shutdowns in October for upgrades...

Q3 is on Tesla, they should have given a much clearer forecast on the Q2 earnings that they were ending the wave. It's entirely possible that it's just like they say and pivoted at the last moment to be more efficient. But as company, you're going to get punished for that on your stock.

Which boosted production more than transportation could handle...

So, if Tesla announces something they know it gets spun, and if Tesla doesn't announce something they couldn't know, it gets spun...

2) I think Q4 numbers will be bad because lots in the US will want to defer deliveries until 2023 for the tax credit. It's a pretty big difference in cost. "Oh you'll be moved to back of the line!" For $7500 difference in a recession (and shrinking wait times), who cares?

Refusing delivery resets their pricing and timing, plus $7.5k isn't determined yet.

 

[Artful Dodger]

I think so as well; the watch tool went from 80% to 75% though.

Phil? (do you have life insurance?)

Cheers!

 

[Snerruc]

Big tech too. Amazon and Google are both down pretty big today. Seems like all big tech are the target for this bear market (except AAPL who has been mostly spared during this whole bear market…makes me think they’re next).

Perhaps Apple is not down like the others because they pay a dividend.

 

[FSDtester#1]

This is a monthly options expiration day, implyiing more interest than in an ordinary weekly, but less than for a quarterly (Triple Witching).

A survey of today’s open interest and trading volume in TSLA options, suggests that $180 would be the most profitable target for big option writers (hedge funds & market makers) with the ability to temporarily influence the share price.

Either you have a crystal ball or your methods and metrics seem pretty darn accurate.

Would you mind sharing how you were able to give us this valuable information?

Asking for a friend who wants to put his life savings into Nikola.