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

I don't have the actual note (probably can be found on Twitter if you are brave) but Jonas points out that "Despite challenges including decelerating demand and price cuts in China, Tesla is the only electric vehicle maker covered by Morgan Stanley that generates a profit on the sale of its cars."


I still don't understand how this isn't brought up more often. Who cares about specs, or battery tech or any of the crap others claim they have when they can't build at a profit?

Gary Black posted the note from Adam Jonas yesterday evening on Twitter:

Interestingly, Adam has a 330$ price target while he assumes almost no EPS growth in 2023.
 

unk45

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I dont see Korea ... but I welcome @unk45 thoughts.
I'll skip the long history...Korea has Hyundai, that is nearly everything automotive, since they bought the flailing Kia and transformed it.
There are only two relevant foreign participants:
First: Samsung decided to try and ended out doing CKD Nissan models (cars and trucks), five years later they had a new 'mark' when Renault took over Nissan and Carlos Ghosn decided he could do better. That has worked out poorly too, so the present incarnation makes Renault CKD rather than Nissan.

Second: GM bought the failing Daewoo in 2002 and ended out exporting designs globally, the most success has been the Brazilian taxi market, which they dominate. As GM Europe died, and global RHD markets exited the GM Korea has fallen in hard times too.

Bluntly, no foreign automaker has been successful in Korea.
Note 1: 'outside advisors' begged Ghosn and co not to touch Samsung Motors. They thought they knew better. Said 'advisors' departed.
Note 2: GM Korea was an unprecedented case and was very successful until GM pretty much exited Europe and RHD, thus destroying the GM Korea very successful design and export businesses. The only remaining major GM owned global business is in Brazil, where GM Korea supplied all the major models and exported lots of parts too.

In my opinion it would be insane for Tesla to build anything in Korea.
Of course they can, and do, buy products from LG, Samsung and Hyundai and that business will probably grow successfully. Of course the Hyundai is primarily Glovis, successfully for both.

Finally, I admit my own experience there informs my conclusions. OTOH, I strongly recommend Samsung's Shilla Hotel Seoul and their amazing La Yeon restaurant. Over decades it has only become even better.

Just do not ever make a foreign direct investment; suppliers, absolutely, with very careful contracts.
 
I'll skip the long history...Korea has Hyundai, that is nearly everything automotive, since they bought the flailing Kia and transformed it.
There are only two relevant foreign participants:
First: Samsung decided to try and ended out doing CKD Nissan models (cars and trucks), five years later they had a new 'mark' when Renault took over Nissan and Carlos Ghosn decided he could do better. That has worked out poorly too, so the present incarnation makes Renault CKD rather than Nissan.

Second: GM bought the failing Daewoo in 2002 and ended out exporting designs globally, the most success has been the Brazilian taxi market, which they dominate. As GM Europe died, and global RHD markets exited the GM Korea has fallen in hard times too.

Bluntly, no foreign automaker has been successful in Korea.
Note 1: 'outside advisors' begged Ghosn and co not to touch Samsung Motors. They thought they knew better. Said 'advisors' departed.
Note 2: GM Korea was an unprecedented case and was very successful until GM pretty much exited Europe and RHD, thus destroying the GM Korea very successful design and export businesses. The only remaining major GM owned global business is in Brazil, where GM Korea supplied all the major models and exported lots of parts too.

In my opinion it would be insane for Tesla to build anything in Korea.
Of course they can, and do, buy products from LG, Samsung and Hyundai and that business will probably grow successfully. Of course the Hyundai is primarily Glovis, successfully for both.

Finally, I admit my own experience there informs my conclusions. OTOH, I strongly recommend Samsung's Shilla Hotel Seoul and their amazing La Yeon restaurant. Over decades it has only become even better.

Just do not ever make a foreign direct investment; suppliers, absolutely, with very careful contracts.
That is my perspective as well. So I would expect this is just negotiating posture with some other country. Japan? Indonesia? Thailand economy is less than half that of Indonesia. India? Talk about a challenge.

Mexico? That makes some sense. 2nd USA plant even more.
 
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While it’s a one time revenue booking, it also means customers are more likely to order it if they don’t have to deal with safety scores and beta programs—so it should lead to higher GMs on average.

Indeed, and FSD wide release is not truly a 'one-time' revenue bump; that would be the defered revenue portion which is widely believed to exceed $1B. The ongoing revenue from FSD will also increase on a permanent basis as, going forward, Tesla is able to claim 100% of FSD payments as revenue (ie: no longer any accounting need to defer revenue from FSD purchases).

What does this mean in terms of annual income? Perhaps several hundred million dollars per year permanent increase in revenue, almost all of which will fall straight through to the bottom line. As an example, a $316M annual increase in FSD revenue would amount to about $0.10 increase in EPS. With Tesla's Fwd P/E at about 32, that's worth about $10B to Tesla's Mkt Cap.

So not huge at these volumes or FSD take rates, but as both auto sales and FSD take rates increase over the next few years, it will become significant money, and again, nearly 100% of this increased revenue will flow straight to the bottom line. $hould build like a Tsunami of Hurt.

Cheers!
 

jw934

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Jul 23, 2018
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Compared to all other Tesla YouTubers, this analyst’s deep dive into Tesla is refreshing. I enjoyed and agreed with his rating of Tesla recent financial, which he sees as all excellent.

He does not know EV nor talked about Elon nor his vision and aspiration of future growth of Tesla; his analysis talking points in the video are strictly based on the financial statements of Tesla since 2018. I would assume many analysts are in his camp.

Based on a growth rate to 20% to 2032, saying even that is high, his buy price is $100/share. My expectation aligns with Tesla at 50% growth.

Recommended for top marks on how to look at financial statements when picking stocks. Also love his presentation style and the pace.


Edit: [his investment goal is to beat the S&P, hence extremely conservative]
 
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unk45

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That is my perspective as well. So I would expect this is just negotiating posture with some other country. Japan? Indonesia? Thailand economy is less than half that of Indonesia. India? Talk about a challenge.

Mexico? That makes some sense. 2nd USA plant even more.
Mexico makes sense on several levels.
For vehicles: Duty preferences for Mercosur exports (although limited by financial volume, there are ways...), USMCA, large industrial base adjacent to Texas.
Given Tesla history there are certainly ways to negotiate attractive terms for expansion to Central and South America.
For Tesla Energy: Grid investments and peaker substitution throughout the region, with major Chinese investments that can harmonize with Tesla China also.

Indonesia and Thailand both have much to offer. For that matter, Brazil does too, as has been discussed for a long time, with constraints too.

Clearly this is not either/or, it's more a coordinated effort to provide scarce resources and manufacturing in multiple places. I fully expect multiple announcements, probably staged over the next year. Surely there will be significant cooperation with major suppliers around the globe for both raw materials and manufactured goods.
 
I don't have the actual note (probably can be found on Twitter if you are brave) but Jonas points out that "Despite challenges including decelerating demand and price cuts in China, Tesla is the only electric vehicle maker covered by Morgan Stanley that generates a profit on the sale of its cars."

So this note makes it official: AJ couldn't wring any cheap shares out of Uncle Leo last week in Singapore. :p

Fh0JszuVQAEI4Dn


Cheers!
 
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Paracelsus

Active Member
Mar 27, 2015
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So this note makes it official: AJ couldn't wring any cheap shares out of Uncle Leo last week in Singapore. :p

Fh0JszuVQAEI4Dn


Cheers!

That's an awesome photo - proof of dialog. Glad you didn't post the photo of that from Twitter @Artful Dodger , or else it would have immediately been moved to the Twitter page where most of the TMC crowd would have missed it. Oooops, my response mentioned the 'T' word, so it will probably get moved too, despite the fact 'that forum that should not be named' is intent on becoming the source of more and more information we as TMC investors might be able to rely on....................such as 'E' - (the person that cannot be named), mentioning on 'T' (the forum that should not be named) just a few hours ago that the smear piece that Business Insider ran today claiming that Sam Bankman-Fried owned a $100M stake in 'T' was a False Story. I had hoped to post that link here for its relevance to TMC investors, but it would likely be moved since it was on 'T' from 'E' and discussing 'T' so why bother. That's unfortunate IMO, as the 'T' censorship without thought to content on this forum will only lead to a greatly reduced ability for all of us to fight FUD on all the other sites we participate in, and with all other conversations we have. Elon has called out Fake News from other 'news' agencies on 'T' recently, and this was something that so many of us on TMC had hoped could happen for the last decade. Those posts from 'E' on 'T' must be able to be viewed here.........on this forum IMO. Still waiting for a 'B' forum on TMC - you know, 'that president that could not be named', and his 'administration that could not be named'.

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Mod: Any complaints about moderating can be filed via PM. don't use the thread. Your posts about SBF and also AOC were moved to the Twitter thread because, sorry, they have zero relevance to Tesla/TSLA. And it's not like that thread is behind a paywall; the posts are there for everyone to see. It could actually use some love, as it's now full of sorrow.
 
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That's an awesome photo - proof of dialog. Glad you didn't post the photo of that from Twitter @Artful Dodger , or else it would have immediately been moved to the Twitter page where most of the TMC crowd would have missed it. Oooops, my response mentioned the... <snip>

meme metamucil. ;)
 

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